Snow First, Floods Next?
As a consequence of the unusually cold and snowy winter, Poland’s GNP in the first quarter of 2010 is likely to be approximately PLN 1.5 billion lower than it would be under ‘normal’ weather conditions. Invest Bank economists predict that the yearly dynamics coefficient in the construction sector will drop by 15% owing to unfavourable weather conditions. Heavy snowfall makes it impossible for certain work to be carried out, the extremely low temperatures lead to delays that were not foreseen. Light frost is an obstacle that can be overcome but when the temperature drops below -20 degrees C. all construction must come to a stop while companies still incur all fixed costs, i.e. those related to the maintenance of construction sites.
The transport industry has also suffered losses. Polish State Railways (PKP) was forced to allocate an additional PLN 5.5 million to combat the weather. “These are the costs of de-icing electrical lines as well as using diesel locomotives rather than electric ones, whose operative costs are considerably higher,” says a PKP spokesman. Those in the car business also complain as customer service issues are on the rise owing to weather-induced delays. Cities are spending millions of złoty on the removal of snow with Warsaw topping the list with over PLN 100 million already spent this winter. On the other hand, there are companies that are actually profiting from the harsh weather conditions. Salt mine profits are higher than usual, coal mines and gas companies are responding to increased heating and energy needs and earning above-average amounts as a result. As we await the end of the winter season the country is already making preparations for one disaster everyone hopes to avoid – floods.
Gazeta Wyborcza
