POLAND attra. It d : - billion In FDI in 1999. according to PAIZ statistics (hat include Investments of at least SI million From 1989 through the end of June 2000. Poland attracted a total of 838.9 billion in foreign investments exceeding $1 million including investments below 8) million, the figure was 843.01 billion.

According to the Organization for Economic Cooperation and Development (OECD) defi-nltion used of PAIZ, a foreign investor must hold at least It) per cent stock in a company and have long-term plans. FDI covers outlays incurred in stock acquisition, in addition to reinvested profits and loans granted Io subsidiaries from parent organizations.

During the first half of 2000. Poland attracted 83.7 billion in FDI. including investments below 81 million, the sum was almost 84 I billion. This was less than the previous year 184.7 billion), but more than in the second half of 1999 (83.2 billion). "Investors were undeterred by the trade and current account deficits, and higher inflation.' Pawlowlcz said.

In the first half of 2000. 45 new companies entered Poland. Sweden s Vattenfall paid S232.3 million to buy 45 per cent of privatized Eleklrocleplownir

Warszawskir combined heat-and power plant and Belgium's Iractebel paid 882.8 million to buy shares in the Pola nice power plant. EM Warburg. Pincus & Co of the United States and IT International Theaters of Israel, which bought Into Nella. each invested 850 million.

The energy sector, currently undergoing privatization, generated the greatest interest among companies entering the Polish market, followed by construction. telecommunications and entertainment.

In the first half of 2000. only 8.5 jwr cent of FDI was linked with privatization projects, and 91.5 per cent with takeovers, mergersand greenfield projects. The latter accounted for 40-60 per cent of all FDI

The year-end perspective will chance alter statistics account for the purchase of 35 pej ent of Telvkoniumkacja Polska SA by Frame Telecom. The irans-aefinn will account for almost 10 per cent of cumulative FDI in Poland.

The geographic Inflow of capital into Poland has remained stable. In the first lialf of 2000. US companies invested the most money in Poland. Their share in overall FDI was 33 per cent. The leader was Citibank of the United Stales.

which Invested more than 8750 million in shares of Bank I landlowy. General Electric Corporation invested 8291.4 million in banking and electrical machinery production.

To date, the United States has Invested a total of 86.4 billion in Poland, followed by Germany with S6.2 billion’, France with 84.1 billion, the Netherlands with 83.7 billion. Italy with 83.3 billion. Britain with 82.6 billion, multinationals with S2.6 billion and South Korea with 81.6 billion There has been only minimal shuffling of this list of investors, in the first half of 2000. the United States replaced Germany' as > investment leader. The European Union accounts for 324.7 billion FDI to date. North America for S6.6 billion and Asia for 82 billion.

Manufacturing accounted for ihe most capital with SI8.2 billion, including 84.7 billion in food production. S4.45 billion in transportation production and S2.3 billion in the production of goods from non-metallic raw materials. The financial brokerage sector accounted for 89 2 billion, retail for 83.8 billion and construction for S2.2 billion.

Sectors such as ta-wrage. food and cigarette production

were the most popular among investors accompanied by transportation production and electrical and optical equipment.

PAIZ also noted that investment plans lor the end of June 2000 called for the implementation of projects totaling SI2 27 billion.

What will happen when Poland runs out of its flagship privatization enterprise (hat attract foreign capital? Paw-

lowicz said that after privatization ends in sectors such as energy. chemicals and uhanna-eeuticals. accompanied by a reduced inflow of investments stimulated by privatization. Poland will remain attractive because of liberal business regulations, a general improvement in business conditions, and Poland's EU integration. "In the medium term. FDI in Poland should run at an average of S10 billion annually." Paw-lowicz said.