If you are correct and Poland is the next powerhouse in Europe, then a country ETF might be interesting. I just took a quick look at the country ETF iShares MSCI Poland ETF (EPOL). The P/E ratio is just shy of 13. Looks attractive. I also like that Poland still has its own currency vs. being part of the Euro. I added Poland to my research list.
On a side note, I have been to Germany, Japan, and South Korea many times (not yet to Poland), and I have seen it first-hand what you wrote about. Japan and Germany remind me (sadly - as I like both countries) of the old quote, "Success can lead to complacency, and complacency is the greatest enemy of success."
Polish rise to prominence, in some respects, is a story of a country that is rising in spite of, not necessarily because, of government intervention. It must be stated that for decades, Polish economy was driven by foreign investment, largely because of lack of national champions that had sufficient capital of their own to power themselves above the foreign competition - something that an aggressive industrial policy of S.K achieved ( a lot of state industries were sold on the cheap in the 1990s, and it was seen as a betrayal of the national industrial policy for a long time in Poland). However, through integration with Western markets, Poland was able to leverage its highly skilled population to grow these businesses. Orlen is now a flagship business for the country's energy sector, and a largest company of its sector in Central/Eastern Europe. CD Project is a strong cultural and digital presence as well, and a multitude of niche white goods manufacturers that are benefitting from a gap in Western Europe's own manufacturing of this kind. Addition of logistic hubs, IT and Polish ability to work in Western economies without a hitch mean that Poland is perhaps close to an end of history of catching up that dogged its existence in the past several centuries.
The geopolitical alignment with America is a sheer necessity, where Western Europe is both unwilling and unable to support Polish ambitions to the degree that the current trajectory of the country demands. I am somewhat reluctant on this connection, but in absence of other geopolitical partners that are willing to let Poland expand (Germany was never keen on it, French attitudes have always been mercurial and Russia as a partner is a conversation of a different kind, if even feasible), the Atlantic connection is the only one that will allow the country to assert itself and perhaps, continue to take on leading role on the Continent. Who knows, maybe the renaissance of Europe as a power will happen under leadership of Warsaw? An amusing prospect for now, but not unrealistic with passing of time.
A good purely Polish strategy would be to balance US patronage with accommodation with Russia. This is one of the stressors on Eastern Europe that will spell the end of NATO and the EU - the Western powers are not going to see it this way, at least not now. The country's been invaded many times by nearly all of its neighbors. Maybe its own nuclear deterrent will be the answer.
I want to start by expressing my support for nuclear energy in Poland. While I am not fully informed about the state of Poland's gas reserves, it seems logical that nuclear energy could play a significant role in their energy mix. However, it is crucial to move beyond simplistic metrics when evaluating the viability of energy sources.
The concept of energy density, often cited as a measure of an energy source's potential, is an outdated and misleading way to assess viability. This metric might have been useful in the past, particularly if nuclear energy were an unproven technology. In such a hypothetical scenario, energy density could have been leveraged to secure research and development funding. However, nuclear energy has been a established technology for over 70 years, rendering this argument obsolete.
Instead, we should focus on the most straightforward and relevant metric: price. The cost of energy production is a direct and tangible indicator of an energy source's practicality and competitiveness. It is baffling that other metrics continue to be prioritized over price, which ultimately determines the feasibility of widespread adoption.
Moreover, the energy density metric could have been relevant if nuclear energy were utilized for transportation. However, this is not the case, at least not commercially. Currently, nuclear energy is primarily harnessed through large-scale power plants, typically operating at capacities of 1-2 GW.
To further bolster their nuclear ambitions, Poland should consider attracting German nuclear engineers. Leveraging the expertise of these professionals could significantly enhance Poland's nuclear energy infrastructure and capabilities.
“It is baffling that other metrics continue to be prioritized over price which ultimately determines the feasibility of widespread adoption.”
Not really IMO. Reliability is not traditionally “priced” but is a major determinant of a project’s feasibility. If one tallys every penny spent on every aspect of the decision - available land, fuel supply, legal fees on local opposition- which aren’t tabulated traditionally in price per kW for installation, then one needs to get very specific on what a project will cost. Energy density plays a role in that calculation. Additionally, political ideology favoring one generation method over another - I suspect a country could find a new hydro plant has lower LCOE than renewables but could never get it built due to law or public opposition.
S.K. And Poland are an interesting comparison. South Korea, essentially a feudal economy prior to WWII, developed into a modern economy faster than anyone has ever done it before. Poland has taken a little longer, but had the dead weight of 70 yrs of Soviet oppression slowing it down, plus was heavily bombed during the war. And of course, unlike Germany, Poland hasn’t opened its borders to millions of people who hate it.
What a load of crap. Poland was another agricultural backwater before the USSR, and the majority l of it's present industry is the remnant of the Warsaw Pact investment made by the Soviet Union. It's not native and not backed by tradition - poles aren't engineers or scientists, they're farmers and craftsmen at best.
Poles wouldn't fight their way out of a wet paper bag as an "industrial powerhouse", because they don't have raw mineral resources for a top-down, sovereign indusrry approach, nor the demographics for it (which, despite not importing migrants, are happily immigrating themselves).
Plus they've a logistics bottleneck for imports of said resources. It's a slightly saner Ukraine, but not by a large margin.
They will need to "build the machine that builds the machines". This is why Europe cannot build new nuclear in time and budget. We no longer have the supply chain, network of companies and people's skillset needed to build these behemoths.
In 1966 Carolina Power and Light decided to build a nuclear power station. Construction began in 1967. H B Robinson went online in 1971 and has been operating profitably since then.
( in 1966 Star Trek premiered and Heinlein published The Moon Is A Harsh Mistress. I miss the optimism of 1966)
Please note that Germany resigned from Russian gas due to war.
As a paralel example: Imagine that Mexico was in war with Guatemala and made threats to invade USA, and USA was reliant for most of natural gas supplies from Mexico.
Second: Levelized Cost of Energy currently is the lowest in coal, but due to "green deal" it may become very expensive, thus nuclear is the choice.
Without "green certificates" and "green taxes" coal would have been the key choice.
I am gobsmacked anyone is throwing more money at an AP1000. Look at the financial devastation caused by all attempts so far to build the things. One project cancelled after wasting a cool $9billion. The other only completed with massive tax and ratepayer subsidies and after sending the parent company Toshiba broke.
Poland certainly won't build much of a future on such a lemon.
Poland will only truly hit the big-time league rating when there are tRump-branded hotels in Warsaw and Krakow, and new tRump-branded golf courses going up in drained- out areas of the Pripet Marshes.
Great article.
If you are correct and Poland is the next powerhouse in Europe, then a country ETF might be interesting. I just took a quick look at the country ETF iShares MSCI Poland ETF (EPOL). The P/E ratio is just shy of 13. Looks attractive. I also like that Poland still has its own currency vs. being part of the Euro. I added Poland to my research list.
On a side note, I have been to Germany, Japan, and South Korea many times (not yet to Poland), and I have seen it first-hand what you wrote about. Japan and Germany remind me (sadly - as I like both countries) of the old quote, "Success can lead to complacency, and complacency is the greatest enemy of success."
Thank you! Yes, Poland staying out of the Euro says a lot.
Polish rise to prominence, in some respects, is a story of a country that is rising in spite of, not necessarily because, of government intervention. It must be stated that for decades, Polish economy was driven by foreign investment, largely because of lack of national champions that had sufficient capital of their own to power themselves above the foreign competition - something that an aggressive industrial policy of S.K achieved ( a lot of state industries were sold on the cheap in the 1990s, and it was seen as a betrayal of the national industrial policy for a long time in Poland). However, through integration with Western markets, Poland was able to leverage its highly skilled population to grow these businesses. Orlen is now a flagship business for the country's energy sector, and a largest company of its sector in Central/Eastern Europe. CD Project is a strong cultural and digital presence as well, and a multitude of niche white goods manufacturers that are benefitting from a gap in Western Europe's own manufacturing of this kind. Addition of logistic hubs, IT and Polish ability to work in Western economies without a hitch mean that Poland is perhaps close to an end of history of catching up that dogged its existence in the past several centuries.
The geopolitical alignment with America is a sheer necessity, where Western Europe is both unwilling and unable to support Polish ambitions to the degree that the current trajectory of the country demands. I am somewhat reluctant on this connection, but in absence of other geopolitical partners that are willing to let Poland expand (Germany was never keen on it, French attitudes have always been mercurial and Russia as a partner is a conversation of a different kind, if even feasible), the Atlantic connection is the only one that will allow the country to assert itself and perhaps, continue to take on leading role on the Continent. Who knows, maybe the renaissance of Europe as a power will happen under leadership of Warsaw? An amusing prospect for now, but not unrealistic with passing of time.
A good purely Polish strategy would be to balance US patronage with accommodation with Russia. This is one of the stressors on Eastern Europe that will spell the end of NATO and the EU - the Western powers are not going to see it this way, at least not now. The country's been invaded many times by nearly all of its neighbors. Maybe its own nuclear deterrent will be the answer.
I want to start by expressing my support for nuclear energy in Poland. While I am not fully informed about the state of Poland's gas reserves, it seems logical that nuclear energy could play a significant role in their energy mix. However, it is crucial to move beyond simplistic metrics when evaluating the viability of energy sources.
The concept of energy density, often cited as a measure of an energy source's potential, is an outdated and misleading way to assess viability. This metric might have been useful in the past, particularly if nuclear energy were an unproven technology. In such a hypothetical scenario, energy density could have been leveraged to secure research and development funding. However, nuclear energy has been a established technology for over 70 years, rendering this argument obsolete.
Instead, we should focus on the most straightforward and relevant metric: price. The cost of energy production is a direct and tangible indicator of an energy source's practicality and competitiveness. It is baffling that other metrics continue to be prioritized over price, which ultimately determines the feasibility of widespread adoption.
Moreover, the energy density metric could have been relevant if nuclear energy were utilized for transportation. However, this is not the case, at least not commercially. Currently, nuclear energy is primarily harnessed through large-scale power plants, typically operating at capacities of 1-2 GW.
To further bolster their nuclear ambitions, Poland should consider attracting German nuclear engineers. Leveraging the expertise of these professionals could significantly enhance Poland's nuclear energy infrastructure and capabilities.
“It is baffling that other metrics continue to be prioritized over price which ultimately determines the feasibility of widespread adoption.”
Not really IMO. Reliability is not traditionally “priced” but is a major determinant of a project’s feasibility. If one tallys every penny spent on every aspect of the decision - available land, fuel supply, legal fees on local opposition- which aren’t tabulated traditionally in price per kW for installation, then one needs to get very specific on what a project will cost. Energy density plays a role in that calculation. Additionally, political ideology favoring one generation method over another - I suspect a country could find a new hydro plant has lower LCOE than renewables but could never get it built due to law or public opposition.
S.K. And Poland are an interesting comparison. South Korea, essentially a feudal economy prior to WWII, developed into a modern economy faster than anyone has ever done it before. Poland has taken a little longer, but had the dead weight of 70 yrs of Soviet oppression slowing it down, plus was heavily bombed during the war. And of course, unlike Germany, Poland hasn’t opened its borders to millions of people who hate it.
SK has worse birth rates and vital statistics than EU countries: they work themselves to death, individually and collectively.
What a load of crap. Poland was another agricultural backwater before the USSR, and the majority l of it's present industry is the remnant of the Warsaw Pact investment made by the Soviet Union. It's not native and not backed by tradition - poles aren't engineers or scientists, they're farmers and craftsmen at best.
Poles wouldn't fight their way out of a wet paper bag as an "industrial powerhouse", because they don't have raw mineral resources for a top-down, sovereign indusrry approach, nor the demographics for it (which, despite not importing migrants, are happily immigrating themselves).
Plus they've a logistics bottleneck for imports of said resources. It's a slightly saner Ukraine, but not by a large margin.
So like, dream on.
They will need to "build the machine that builds the machines". This is why Europe cannot build new nuclear in time and budget. We no longer have the supply chain, network of companies and people's skillset needed to build these behemoths.
The effort will be truly monumental.
Indeed. Where are the "machine tools" in Europe? Likely Germany.
In 1966 Carolina Power and Light decided to build a nuclear power station. Construction began in 1967. H B Robinson went online in 1971 and has been operating profitably since then.
( in 1966 Star Trek premiered and Heinlein published The Moon Is A Harsh Mistress. I miss the optimism of 1966)
The optimism to build has been replaced by the pessimism to regulate out of existence.
I love your work.
That means a lot. Glad to have you reading!
Grateful “Environmental” shared your last article, and I found you all. Your work is so informative! Thank you and looking forward to the next one 👊
Thank you for reading!
Please note that Germany resigned from Russian gas due to war.
As a paralel example: Imagine that Mexico was in war with Guatemala and made threats to invade USA, and USA was reliant for most of natural gas supplies from Mexico.
Second: Levelized Cost of Energy currently is the lowest in coal, but due to "green deal" it may become very expensive, thus nuclear is the choice.
Without "green certificates" and "green taxes" coal would have been the key choice.
With coal use, ironically, global temperatures would be lower. Because of the particulate and other emissions.
https://www.sciencedirect.com/science/article/abs/pii/S0269749125000429
I am gobsmacked anyone is throwing more money at an AP1000. Look at the financial devastation caused by all attempts so far to build the things. One project cancelled after wasting a cool $9billion. The other only completed with massive tax and ratepayer subsidies and after sending the parent company Toshiba broke.
Poland certainly won't build much of a future on such a lemon.
Poland will only truly hit the big-time league rating when there are tRump-branded hotels in Warsaw and Krakow, and new tRump-branded golf courses going up in drained- out areas of the Pripet Marshes.
Are you sure those yields from nuclear are net of the input energy for creating the nuclear fuel?
Putin will stamp out the progress ultimately when Trump’s agenda is exposed !