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WALBRZYCH SPECIAL ECONOMIC ZONE



The Walbrzych Special Economic Zone (WSSE) was established on April 15, 1997. The zone's tax incentives will be in effect for 20 years. The zone is located in the southwest part of Poland and borders on the Czech Republic (19 border crossings). The WSSE consists of four sub-zones and currently covers 256.43 hectares (ha):

* Walbrzych sub-zone - 133.01 ha,
* Nowa Ruda sub-zone- 04.41 ha,
* Klodzko sub-zone- 23.34 ha, and
* Dzierzoniow sub-zone - 15.67 ha.

The zone is managed by the limited liability company "Walbrzyska Specjalna Strefa Ekonomiczna Invest Park." The shareholders of the company are the Polish State Treasury represented by the governor of the Walbrzych province, the municipality of Walbrzych, and the real estate agency Reliqum Ltd., a joint-stock company of the Polish State Treasury. The special economic zone was established on land owned by the Polish State Treasury, local governments, existing companies, and private owners. An agreement to purchase the land from private owners by the Walbrzych municipality has already been signed.

Entities operating in WSSE are completely exempt from all real estate taxes. Additionally, they can benefit from one of the following incentives:
- 100 percent income tax relief during the first 10 years, and a 50 percent reduction of income taxes for the next 10 years, if investment in the zone exceeds 500,000 ECU;
- relief from 20 percent of income taxes in the same month that 10 new workers are hired, up to a maximum of 100 percent of income taxes due, and no less than 20 percent;
- increase in the depreciation rate on tangible assets and/or calculation, for tax purposes, of purchases of legal and other services as an expense against income.

The main goal of the Walbrzych Special Economic Zone is to assist in restructuring existing business in the region and to increase employment. Also important for the region is the use of existing technical infrastructure to develop industry and and the use of natural resources in the region. The mining industry which is the economic foundation of the region is collapsing. There are many municipalities in the region where people are wholly dependent on one or two large companies. Some of these companies were liquidated which caused a breakdown of existing social support structures.

The unemployment rate in the region was 23 percent (almost 70,000 unemployed people) at the end of 1996, while average unemployment in Poland is 14.9 percent. Over 63 percent of employed workers in the region have professional qualifications. Most are economists, engineers, electro-technicians, and workers from metal, textile, glass, and ceramic industries. Higher education establishments in the region include branches of the Technical University of Wroclaw, Wroclaw Academy of Economics, higher school of management and enterprise, teachers' college, and college of foreign languages. Wroclaw, one of Poland's educational centers, is 30 km from the border of Walbrzych.

Development of different branches of industry is necessary to decrease unemployment in the region. Industry is mainly located in the cities of Walbrzych, Swidnica, Dzierzoniow, Bielawa, Nowa Ruda, and Swiebodzice. WSSE is expecting to develop electrical technology, electronics, machinery, metal, and textile industries in the region. Production in the zone cannot be harmful to the environment. Thus far, few big investments have begun in the region.

U.S. companies interested in doing business in the WSSE should contact:
Mr. Miroslaw Greber, President
Walbrzyska Specjalna Strefa Ekonomiczna Invest-Park Sp. z o.o.
Walbrzych Special Economic Zone Invest-Park Ltd.
ul. Uczniowska 21 (II Floor)
58-306 Walbrzych, Poland
Tel: (48-74) 41-35-00
Tel/Fax: (48-74) 41-01-77
or
Urzad Wojewodzki w Walbrzychu, Biuro Ds. Restrukturyzacji
(Office of the Walbrzych Province, Restructuring Divison)
ul. Zamkowa 4
58-300 Walbrzych, Poland
Tel: (48-74) 26686, 22226
Fax: (48-74) 22933

**Provided courtesy of the Central and Eastern Europe Business Information Center (CEEBIC)
CEEBIC