A motley crew: the silent rockstars of Polish exports
Poland is renowned for its export diversification, but there are a number of niche export leaders that have caught even the top analysts by surprise. Did you know that Poland is the EU leader in yacht exports or 2nd in video game console exports?
Poland’s export narrative has largely mirrored the course of the economy itself. Barring a blip in the wake of the Global Financial Crisis in 2009, the export sector has known only one direction since 2000 and that’s up. 2019 looks to continue this trend, with the first quarter results (January-April) showing 3% year-on-year growth, as Statistics Poland (Główny Urząd Statystyczny: GUS) confirmed last month.
It’s also no surprise that the shape of the sector reflects the diversified nature of the economy as a whole. The export base is relatively fragmented with Machinery (13.5%), Vehicles (11.4%) and Electrical Machinery (10.7%) comprising the top three product groups, while Furniture (5.7%) and Plastics (5%) round off the top five. But break each group down and there are a number of surprising niche superstar exports silently rocking their own respective fields.
The Polish Economic Institute (Polski Instytut Ekonomiczny) last month shone the spotlight on two unheralded export champions that have been making more noise outside than within the borders of Poland. For example, Poland is the largest exporter of pleasure and sports watercraft* in the EU. In fact, there is a nautical mile between Poland and the rest of the fleet with Polish manufacturers commanding a mega 60% of the EU export market in 2018. The next best was Finland at 9.1%.
Each year Polish shipyards produce around 22 thousand units, according to the aptly named industry body, POLBOAT (the Polish Chamber of Marine Industry and Water Sports). These high-value exports are largely destined for the USA, Norway, France, Germany, Russia and the Middle East, while a growing number of Polish-produced yachts have been spotted in waters as far as Australia, China and Japan. Internationally, Poland is ranked just behind the USA in the production of smaller watercraft in the nine-metre or under category.
2018 was also a bumper year for Poland’s video game console** industry after surpassing the manufacturing Goliath of Germany to claim 2nd place. With 20% share of exports, Polish manufacturers trailed only the Netherlands (31.8%) in 2018. Over the past four to five years, the local industry has grown with Sonic the Hedgehog speed, increasing its overall output from €235 million in 2014 to €1.3 billion in 2018. That’s more than a five-old increase.
Correspondingly, with 95% of sales heading abroad, the video game industry in Poland has gone from strength to strength, on the back of the recent hit of ‘This War of Mine’ from Frostpunk studio and of course, the series that put Polish video gaming on the map, ‘The Witcher’ series from CD Projekt studio. With the original story (written by Andrzej Sapkowski) set to appear as a Netflix TV series later in 2019, the Witcher video game trilogy is bound to add to its tally of 40 million copies sold to date – the third instalment (‘The Witcher 3: Wild Hunt’) alone has recorded 20 million in sales.
The Polish Games Association reported that Poland’s 331 game studios recorded a joint revenue of 1.14 billion zł in 2017. Newzoo, the global games and esports analytics company, ranked Poland last year as the 24th largest producer of video games.
No analysis of Polish exports would be complete without mentioning the apple industry. According to the Food and Agriculture Organization of the United Nations, Poland was the second largest exporter of apples in the world in volume (1.09 million tonnes) and 8th in dollar value ($350.6 million) in 2016. The picture was even better back in 2014 when Poland held the number one spot, only to see its largest market disappear overnight when Russia issued a trade embargo that same year.
The industry, however, was quick to respond by finding new markets and methods to process the product. One interesting development that arose out of the adversity was the advent of Polish Cider. Between 2011 and 2016, Poland became one of the fastest growing cider markets in the EU with a 37.37% growth rate, according to a 2018 report from The European Cider & Fruit Wine Association (ACIV). At 489.20 hectolitres, it recorded the EU’s 6th highest output over the same period.
It appears that Polish orchardists might have proved the old adage true: when life sends you lemons, make apple cider.
*CN 890399: vessels for pleasure or sports; rowing boats (excl. motorboats and motor yachts powered other than by outboard motors, sailboats and yachts with or without auxiliary motor and inflatable boats).
**CN 950450: video game consoles and machines (excl. operated by any means of payment).