FUND VIEW-Powerhouse Poland to continue growth trend-UBS

                                
 * Rising wealth, low labour costs help Poland-fund
                                
 * Independence from foreign flows helps avoid recession
                                
 
                                
 By Josie Cox
                                
 FRANKFURT, Aug 26 (Reuters) - As the only country in the EU
to dodge the recent global recession, Poland is now thriving on
its stellar debt position and is likely to flourish even more
over the next years, a fund manager told Reuters on Thursday.
                                
 While still struggling to match its western neighbours in
terms of gross domestic product (GDP) -- which stood at $11,273
in 2009 according to the World Bank -- the former Soviet Bloc
country continues to be a manufacturing hub for Western Europe.
                                
 "It is benefiting from steadily rising levels of wealth but
still relatively competitive labour costs", Gabriel Csendes, who
manages the UBS Equity Central Europe <LP60036222> fund said.
                                
 "There are lasting trends of western European and Asian
companies investing in Poland because infrastructure and
standard of living are improving but labour costs are still
low," he added.
                                
 In addition to UBS statistics which show that, on average,
Poles work longer hours for less money than in most other
European countries, Csendes also pointed to upbeat growth
forecasts for the country and a vibrant equity market supported
by a large domestic investment fund pool.
                                
 Poland, the largest economy in the EU's eastern wing, was
the only country in the union to have positive growth in 2009,
recording real GDP growth of 1.7 percent that year, compared
with 5 per cent in 2008. [ID:nLDE6210YR]
                                
 In March, the European Commission forecast Poland to be the
EU's fastest growing economy in 2010, expanding by 2.6 percent.
                                
 "Unlike countries like Hungary and the Czech Republic, which
also feature in the fund's portfolio, Poland's market is big
enough for the country to be able to focus on domestic trade and
remain relatively sheltered from global economic burdens",
Csendes said.
                                
 This year, the Polish government expects GDP growth to stand
at 3 percent and then accelerate to 3.5 percent in 2011 and 4.8
percent in 2012. Debt is expected to stay below 55 percent of
GDP at least through to 2013. [ID:nLDE6720NR]
                                
 "(Poland) is not overly dependent on foreign flows and uses
the structural funds provided by the European Union effectively.
This is one of the things that saved it from the credit crunch."
                                
 Founded in 1996, the fund currently holds assets of 145
million euros ($184.2 million) and spans the financial,
telecoms, utilities and healthcare sectors in the European
emerging market region.
                                
 Top holdings include Poland's largest bank PKO <PKOB.WA>,
Polish telecom operator Telekomunikacja Polska <TPSA.WA>,
Central Europe's biggest independent bank Otp <OTPB.BU>, Czech
power group Cez <CEZPsp.PR> and Hungarian oil and gas company
MOL <MOLB.BU>.
                                
 It is measured against the MSCI Comb. (CZ, H, PL) index
which it has outperformed narrowly but continuously since 2006,
with the exception of 2008.
                                
 In 2009 the fund booked 43.27 percent return, slightly
topping the benchmark's return on 43.05 percent.
 (Editing by David Cowell)