Poland warns state-controlled giants off foreign expansion

By bne IntelliNews February 22, 2016

Poland will be "very critical" in assessment of plans by state-controlled companies to expand abroad, a senior government official said on February 22.

Treasury Minister Dawid Jackiewicz told weekly Wprost the government will closely look at any move towards foreign acquisitions to make sure the deals return profit for the Polish economy. The statement may be a hint that the government sees revenue, in the form of dividends, as more important than developing Poland's state giants into international operations.

The Law & Justice (PiS) government's social spending programme has put the budget under pressure. The previous administration was keen for state-controlled companies, given their giant size on the domestic market, to expand internationally in order to grow into national champions.

"PKO BP has its own [expansion] program, so does KGHM, while Orlen is also running acquisitions abroad," Jackiewicz told the weekly, according to PAP. "We are in favour of expansion, but only in a rational manner. We will not oppose it, but we will assess them very critically from the point of view of the profits they are to bring."

Jackiewicz also said Warsaw would like Polish firms to coordinate work on big foreign investment projects. The country's largest bank, PKO BP, could provide credit lines for those projects, for example, the minister said. State-controlled companies should also work together on the domestic market, the minister, whose department - responsible under the previous government for managing state assets and privatising them - will be phased out later this year, hinted.

“There is no reason for treasury companies to buy fuel from competitors of Orlen or Lotos's competitors or set up accounts at German, Dutch or French banks if they can do so at PKO BP," Jackiewicz said.




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