Latecomers May Be Admitted: Foreign Direct Investment Between the CEE Countries

Abstract

Foreign direct investment among the Central and Eastern European countries has grown considerably recently, but it is still well below the level of what can be expected on the basis of the inherited economic and personal ties, levels of economic development and geographic proximity of these countries. After briefly describing data problems, the chapter shows the main characteristics of intra-CEE FDI, and its high concentration in terms of home and host countries, which is partly due to a few large investment projects, in certain cases related to privatisation. The validity of the investment development path model is shown, which indicates that further growth of intra-regional FDI may be expected.