Coverage of the 15th edition of “Polish Infrastructure and Construction” conference

On 19 March 2024, the 15th anniversary edition of the “Polish Infrastructure and Construction” conference was held at the Sheraton Grand Warsaw Hotel. Participants had the opportunity to listen to two panel discussions and a special debate of sector leaders. Three presentations, prepared by the event’s partners, were also scheduled. Among the topics discussed during the conference were public procurement, infrastructure construction and the future of the construction industry. The culmination of the event was an evening Awards Gala, “Infrastructure and Construction Diamonds”, during which companies and individuals who distinguish themselves in the industry with a high level of professionalism, innovative approach and economic efficiency were recognized.

The “Polish Infrastructure and Construction” conference started surprisingly, with a presentation by a representative of the banking sector. The opening speech entitled “Great Expectations – Time for a Revival” was delivered by Piotr Bujak, Chief Economist and Director of the Department of Economic Analysis, PKO Bank Polski.

In his speech, Mr. Bujak demonstrated how much the construction industry depends on the broad macroeconomic environment. The construction industry, especially housing, does not like high interest rates, which is why the resumption of the cycle of cuts is eagerly awaited. Moreover, it is a so-called “counter-cyclical” industry, i.e. during good times, costs often are on the rise. Wage increases, especially the minimum wage, have been a significant burden on the construction industry. Nevertheless, according to the speaker, the economy is returning to normal and we have managed a so-called “soft landing”.             

Afterwards, the assembled guests had the opportunity to listen to a case study presented by dr Maciej Kiełbowski and Maciej Zych, Attorneys and Partners, Wardynski & Partners Law Firm. The presentation was entitled “Design Defect Claims and CAR/EAR Insurance”.

The speakers, on the example of one of the investments handled by the law firm, presented the validity of using CAR/EAR insurance in construction and infrastructure projects. CAR – Construction All Risk – is a property insurance similar to standard real estate insurance, but for facilities that have not yet been completed. Although damage caused by design defects is normally excluded from this insurance, it can sometimes be included. However, it cannot be an abstract defect, such as non-compliance with the design. Nor can it relate to a defectively designed part of the structure. Material, physical effects, such as cracks, are most often recognized as damage.

After a short break, it was time for the first panel discussion, entitled “Public Procurement”. The moderator of the debate was dr Hubert Wysoczański, Partner, Lawyer, SSW Pragmatic Solutions. Participating in the discussion, in turn, were Agnieszka Kubiszyn, Director of the Public Procurement Department, Metro Warszawskie, Anna Łopaciuk, Director of the Infrastructure, Transport and Logistics Program, Bank Gospodarstwa Krajowego, Hubert Nowak, President, Public Procurement Office, Jan Styliński, President of the Board, Polish Association of Construction Industry Employers, Przemysław Szulfer, Director of Treasury and Public-Private Partnership, Vinci Construction in Poland (Warbud and Eurovia), Bartosz Tokarski, Financial Practice Leader, Deputy Director of the Strategic Clients Insurance Office, EIB, Maciej Ziomek, Consultancy Leader in the Transport and Infrastructure Sectors, Partner, EY Poland.

The discussants focused on two aspects – the functioning of public procurement law in Poland and possible regulatory changes, as well as the issue of unlocked funds for investments from KPO, the total value of which may be as high as €600 billion, and the upcoming accumulation of infrastructure projects.

Speakers agreed that the theoretically binding principle of mutuality in public procurement is a lifeless provision, and there is still a large disparity of power between procurers and contractors. What is needed, in their opinion, is greater professionalization of those responsible for handling tenders, on both sides of the process. On the other hand, the introduction of clauses on contract valorisation was viewed positively.

Meanwhile, the question of whether the market and the institutions involved in the investment process, including financiers, will be able to cope with the coming accumulation of projects was a matter of concern among the discussants. Also raised was the issue of non-price criteria in tender evaluations, which are still largely a sham and have no influence on contracting authorities’ decisions.

Another highlight of the program was a case study presented by Mirosław Metych, Partner, Head of M&A, Hoogells Oleksiewicz.

The presentation focused on discussing the current guidelines for implementing ESG criteria in infrastructure companies, both at the EU and national levels, as well as funding opportunities.

Among the financial instruments mentioned were green bonds, for sustainability purposes, social bonds – linked to infrastructure that provides well-being for people, or transition bonds, which allow investment in the transition through indirect methods to a green business model.

The next speech was presented by Andrzej Bułka, CEO, Fracht FWO Poland.

According to the speaker, contemporary global trade requires skilled logistics. Meanwhile, few countries can afford to keep the entire production chain internal. A professional logistics partner today must not only focus on transportation, but also assist customers in financing ventures and bear the legal risks arising from transportation.

After Mr. Bułka’s speech, it was time for the second panel, entitled “Road Construction”, which was moderated by dr hab. inż. Janusz Rymsza, Professor of the Road and Bridge Research Institute, Deputy Director for Scientific Affairs and Management Systems. Participants in the discussion included Sławomir Barczak, Director of Infrastructure Department, Mostostal Warszawa, Grzegorz Dziedzina, Acting Deputy General Director of National Roads and Motorways, dr inż. Norbert Kurek, General Director, REMEA, Tamara Małasiewicz, Managing Director, Polish Consulting Engineers and Experts Association SIDiR, Michał Siembab, Partner, GKR Legal Law Firm, Michał Ziajowski, Member of the Management Board, Managing Director of LSO, Aebi Schmidt Polska.

Participants in the panel treated the topic in multiple ways, referring to the issue of public procurement, the economic situation of the infrastructure industry as well as the prospects for the development of the sector, both in economic and technological terms.

Panellists spoke with moderate optimism about the current economic situation in the infrastructure construction industry. Price increases associated with recent global events have been a major blow to many contractors, but the possibility of contract valorisation of up to 15% has helped most to weather the difficult period. However, high costs, which have risen by more than 20% on average in the industry, may mean that even the record funds available for investments will not necessarily translate into the expected number of implementations.

Looking ahead, the discussants addressed the issue of introducing circular economy elements into infrastructure investments. At present, circular solutions are being adopted by a few pioneers, but we need to make them become systemic solutions. For now, we have a situation where everything that leaves the construction site is treated as waste. And in order to put the material back into circulation we need many additional approvals, permits, etc. Meanwhile, we simply cannot afford to treat valuable materials, even from demolition, as waste. The belief that “new is better” still prevails. Architects do not consider the use of recycled materials. Contracting authorities do not want to use them and are afraid for their durability. This needs to change.

The final, special panel of the conference was held under the name “Polish Construction Industry Round Table – Leaders’ Debate”. Moderating the discussion was Konrad Wyrwas, Strategic Director, Polish Association of Construction Industry Employers. Participants included Krzysztof Świerczek, Member of the Board, PKP Intercity, Jorge Calabuig Ferre, Vice President of the Management Board, Mostostal Warszawa, Piotr Kledzik, President of the Management Board, PORR, Hubert Nowak, President, Public Procurement Office, Artur Popko, President of the Management Board, Budimex, and Wojciech Trojanowski, Member of the Management Board, STRABAG.

Leaders of the construction and infrastructure sector primarily attempted to diagnose the industry’s current problems and tried to formulate forecasts for the future. Representatives of the largest construction companies agreed that the industry will cope with the current negative consequences of the international turmoil. However, attention was drawn to the need to build a certain consensus among all participants of the investment process, which should lead to the development of lasting templates and standardization of contractual provisions.

Speakers stressed the need to rebuild a sense of peace and stability in the industry so that it can focus on educating new personnel. This will be a major challenge for the construction industry in the coming years. In addition to engineers and builders, there is a shortage of specialized personnel related to modern infrastructural technologies. However, it is important to remember to educate youth wisely, not in contradiction to the needs of the market.

The “Polish Infrastructure and Construction” conference can be viewed at this link

Organiser:

Executive Club

Media Patrons:

Automatyka Przemysłowa, Magazyn Autostrady, Budowa.org, Budownictwo.org, Budownictwo: Trendy&Biznes, Buduj z Głową, Dobry Dom, Drogowo-Mostowy.pl, Ekonatura, Energooszczędny, Inżynier Budownictwa, InżynierUR.pl, Kapitał Polski, Kruszywa, Mosty, Nieruchomości.biz, Polska Ekologia, Mediaplanet, Portal Przemysłowy, Rynek Infrastruktury, Staleo.pl, Technologie i Budownictwo, Teraz Środowisko, Warsaw Business Journal, Zrobotyzowany.pl

Author: Krzysztof Kotlarski, editor at Executive Magazine

Last Updated on March 22, 2024 by Anastazja Lach