Attracting Investment to South East Europe

Survey of FDI Trends and Investor Perceptions

This FIAS publication, released in November 2007, presents the findings of a survey of foreign corporate executives on the investment opportunities and challenges of South East Europe, a region considered a new frontier for investment within Europe. The findings indicate that an overwhelming majority of foreign investors are encouraged by the region's performance and optimistic about its prospects.

The investor perceptions survey, managed by Ernst & Young, elicited responses from 304 senior executives of multinational corporations from Europe, North America, and Asia. The sample included companies already operating in the region (43 percent) and companies with strong investment and trade ties to the region (57 percent). The results of the investor perceptions survey, including individual country profiles, are augmented with data from a complementary study on FDI trends that analyzed actual investment flows and sectors.

About half of surveyed resident investors said they planned to reinvest and one third of investors outside the region said they were considering setting up in South East Europe. Respondents ranked the region as Europe's best location for manufacturing. They cited low labor costs and flexible labor policy as the region's key competitive advantages and political instability and inadequate infrastructure as impediments to increased FDI flows.

The results—especially the perceived competitive advantages and weaknesses—underscore the areas investors consider most important in improving the region’s business climate. The underlying message from respondents was their need to be better informed about the region as an investment destination and its benefits for their sectors and companies.

Full Report ( 3.404 KB)