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Poland Leverages Skilled, Low Cost Labor

April 25, 2006

POZNAN, Poland (AP) _ Physicist Justyna Czernik carefully places centuries-old seashells in water for ultrasound cleaning, the first step in a complex process to determine their age and help French archeologists study the ancient harbor of Alexandria, Egypt.

With five Ph.Ds, the center _ part of Poznan’s prestigious Adam Mickiewicz University _ is the only one in former communist Eastern Europe for radiocarbon dating, and draws customers from all over the world thanks to low prices, speed and capacity shortages elsewhere.

``There’s nothing east of us until Beijing,″ said Tomasz Goslar, the physicist who heads the laboratory.

The lab, in underground offices along a bumpy, unpaved road, provides just one example of how cheaper, highly skilled workers are helping Poland in its uneven effort to catch up with wealthier neighbors.

High-tech pockets in western Polish cities like Poznan and Wroclaw are showing new prosperity, and overall the country’s economy will grow 4.5 percent this year according to the World Bank. Elsewhere, much of Poland _ particularly the eastern half _ remains a rural backwater dotted with shuttered collective farms and isolated by the country’s notoriously bad roads, with horse-drawn carts still a common sight.

Poznan, by contrast, boasts packed sushi bars and hip new cafes in its exquisitely preserved old town, with its 16th-century city hall. In a country where 18 percent joblessness drives many abroad, Poznan boasts a jobless rate of only 6 percent and Wroclaw 11 percent.

Improving rail and road access, strong universities and local leaders eager to lure investors have all played a role.

``This growth is locally driven, with investors dealing with local authorities on the ground,″ said Ryszard Petru, chief economist for Bank BPH. ``It’s not the result of any countrywide approach.″

Poznan lies on the Warsaw-Berlin express train line, just three hours from each capital. In coming years the A2 highway, whose extension is well under way, will also link Poznan to Germany. The drive from Berlin to Wroclaw has eased in the past two years because of improvements to the highway from the German border.

Wroclaw in particular has campaigned aggressively under Mayor Rafal Dutkiewicz _ a former corporate headhunter with an understanding of business needs _ to attract foreign companies.

The city has streamlined bureaucracy and promoted institutions of higher learning _ Wroclaw University, the Wroclaw University of Technology and the Academy of Economics _ that turn out graduates in computing, finance and engineering.

Foreign investors include AB Volvo, Whirlpool Corp., Siemens AG, 3M Co., and Hewlett-Packard Co., creating jobs that have driven a larger boom for the city of 640,000.

A key prize comes next year when South Korea’s LG.Philips starts production near Wroclaw of liquid-crystal display, or LCD, screens for flat-screen television sets and computer monitors. The first LCD plant in Europe, the facility will employ at least 3,000 people, and the government says deals with subcontractors could generate 9,000 more jobs.

Hewlett-Packard moved a service center to Wroclaw last year from Barcelona, Spain, drawn by lower wages and the linguistic skills of local workers. It employs 250 people, mostly Poles, who answer calls from across Europe in languages including Dutch, Swedish and French.

Wroclaw recruits high school students from elsewhere to attend university there, and is using a computer program to predict what the local labor market will offer in coming years to help attract potential investors.

``We can tell business people how many people we will have in one, two or three years with specific qualifications,″ said Pawel Panczyj, who heads efforts to promote foreign investment in Wroclaw.

``We even joke that we will be able to tell them what color of eyes people will have. But we want to be very specific. We don’t want to predict, we want to be sure.″

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