Behind the scenes, Poland frustrates Russian investments

Tue Oct 23, 2012 7:37am EDT
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By Maciej Onoszko

WARSAW (Reuters) - Poland is conducting an unspoken policy of blocking investments from historical adversary Russia, a stance that could be costly for Warsaw, which needs to find new sources of capital to replace the weakened euro zone.

In the past six months, attempts by investors to acquire stakes in two high-profile Polish companies have been torpedoed, according to people with knowledge of the discussions, in large part because the bidders were Russian.

Suspicion of Russian intentions in Warsaw is entrenched: For centuries Poles feared Russians as invaders and oppressive rulers. Since the end of the Cold War, that has been replaced by Polish fear of Russia's economic dominance.

What is new is that Poland's economy is slowing after decades of robust growth and can no longer rely on investor interest from its struggling trading partner, the euro zone.

With this in mind, some have questioned whether Poland can afford to reject any foreign capital, even from Russia.

"Our economy needs capital for us to develop. Why would it matter if it is Russian, or Chinese for that matter?" said Miroslaw Gronicki, a former finance minister in a government led by a leftist alliance that is now in opposition.

A policy of opposing Russian investments in certain sectors could have implications for Russia's biggest lender, the state-controlled Sberbank, which has declared an interest in entering the Polish market.

Reuters has uncovered previously unreported details of how Russian bids were rebuffed for Polimex, one of the country's three biggest construction firms, and a second firm, Poland's largest chemical group Tarnow.   Continued...