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Impact of “Europe agreements” on FDI in developing countries

Impact of “Europe agreements” on FDI in developing countries Argues that the association of Bulgaria, Hungary, Poland, Romania, Czech and Slovak Republics (CEECs) with the European Union (EU) under “Europe agreements” is unlikely to divert any significant amount of foreign direct investment (FDI) from developing countries because most of it in the latter is location specific. Notes that this applies to investments in natural resources, services and manufacturing industries targeting at domestic markets of the host developing countries. Only in the case of footloose labour and pollution intensive branches, developing countries may face additional locational competition from the associated CEECs. But such industries generally have very low shares in total FDI. Moreover, relative costs of production in CEECs are expected to rise in the course of their convergence towards EU standards. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Social Economics Emerald Publishing

Impact of “Europe agreements” on FDI in developing countries

International Journal of Social Economics , Volume 23 (10/11): 14 – Oct 1, 1996

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References (14)

Publisher
Emerald Publishing
Copyright
Copyright © 1996 MCB UP Ltd. All rights reserved.
ISSN
0306-8293
DOI
10.1108/03068299610149516
Publisher site
See Article on Publisher Site

Abstract

Argues that the association of Bulgaria, Hungary, Poland, Romania, Czech and Slovak Republics (CEECs) with the European Union (EU) under “Europe agreements” is unlikely to divert any significant amount of foreign direct investment (FDI) from developing countries because most of it in the latter is location specific. Notes that this applies to investments in natural resources, services and manufacturing industries targeting at domestic markets of the host developing countries. Only in the case of footloose labour and pollution intensive branches, developing countries may face additional locational competition from the associated CEECs. But such industries generally have very low shares in total FDI. Moreover, relative costs of production in CEECs are expected to rise in the course of their convergence towards EU standards.

Journal

International Journal of Social EconomicsEmerald Publishing

Published: Oct 1, 1996

Keywords: Eastern Europe; Investment

There are no references for this article.