Transformation in the light of theory and globalization

Viac o knihe

FDI is a crucial element of a successful international economic system and a key driver of development. Growing economies present numerous opportunities for profitable trade and investment. A report from the Vienna Institute for International Economic Studies highlighted that FDI inflows to Central, East, and Southeast Europe reached a record EUR 77 billion in 2006, a 30% increase from the previous year. This surge was largely due to heightened economic growth and transformation progress, with Southeast European countries in the Western Balkans receiving double the FDI compared to 2005. This paper will analyze the benefits of FDI inflow to host countries, emphasizing significant advantages such as technology spillovers, human capital development, enhanced competitive business environments, contributions to international trade integration, and improved enterprise development. It will also address concerns regarding potential drawbacks, including negative impacts on the balance of payments due to profit repatriation, insufficient linkages with local communities, environmental harm from heavy industries, and effects on national market competition. Additionally, the role of privatization in attracting FDI in Southeast Europe will be examined.