Poland's Prime Minister Donald Tusk has arrived in Moscow to meet President Vladimir Putin and Prime Minister Victor Zubkov. Economic ties will be a key issue on the agenda and hopes for the upcoming talks are high.

Last year the two countries were at loggerheads over Russia's ban on Polish meat, which led to Poland vetoing talks on a new cooperation agreement between Russia and the EU.

Poland is Russia's leading trade partner in Central and Eastern Europe. Rebounding from political difficulties and a Russian ban on Polish meat exports, bilateral trade was worth an estimated $US 20 billion in 2007.

A key factor for both sides has been the balance of trade.  Polish exports to Russia currently run at only about half the level of imports, but the resumption of meat exports is expected to see this improve.

“Poland's exports stand at about $US 6.5 billion, while imports stand at $US 13 billion, so we have a large trade deficit. But Polish exports are growing fast – we had 40% growth last year. Food exports have been much slower – at 15% due to the meat ban. But with this issue finally resolved we believe Poland will enter the ranks of Russia's main trade partners,” predicted Jerzy Rutkowski, economic counsellor at the Polish embassy in Moscow .

Apart from agricultural goods, Poland exports machinery, consumer goods, furniture and home appliances. The Polish company Bella, which produces sanitary protection products for women, has conquered 30% of Russian market.

A strong Polish economy is also driving increasing investment in Russia. With Russia now focusing on doing more with its timber at home, Polish companies have been key investors in the drive to modernise production facilities.

Investment ties between the two nations are expected to be further strengthened, with business interests on both sides looking for a bilateral agreement to protect mutual investment.

“Polish investors are looking for direct investments and they feel somewhat restricted without such an agreement. So today this looks like the most important issue that needs to be resolved by our governments in order to help investors in both countries. In this field the demand is huge, but opportunities limited,” said Krzyszyof Barcikowski, the head of Polish BGZ Bank in Moscow.

Donald Tusk’s arrival in Moscow marks an opportunity to place business ties on a new level.  Business in both countries expect the two nations to work towards reducing bureaucracy and other key issues such as logistical infrastructure.