Boosting business in Southeastern Europe

think: act CONTENT

2006

"EU Accession is an opportunity rather than a guarantee. It is not the end of the road but it is actually the beginning."

(Francesca Pissarides, Senior Economist, European Bank for Reconstruction and Development)

The European Commission has given its placet. On January 1, 2007, Romania and Bulgaria will become part of the European Union. Their accession is a symbol of the buoyant economic development currently taking place in Southeastern Europe. The former crisis region now stands for growth and sustainable economic development – as a sales market, as a production location, and as a gateway to Asia and the Middle East. Romania’s and Bulgaria’s accession to the EU, and the outlook for Croatia to follow suit, is giving fresh momentum to the upswing in Southeastern Europe.

Romania is regarded as one of the region’s economic heavyweights. The National Office of Statistics compiled a glowing report for the first half of 2006, with GDP surging by 7.4%. After a bleak period, economic policy reforms and political stability have returned Bulgaria to a stable growth trajectory. The same applies to Croatia, the wealthiest country in Southeastern Europe in terms of GDP per capita. The Economist Intelligence Unit expects all three economies to continue their strong growth. It confirms that they are right on track for EU membership.

A singular challenge for foreign investors is the heterogeneous nature of Southeastern Europe. The countries in this region vary considerably in terms of size, culture and language. High-flying generalizations will miss their mark in this region. Aware of this, we have restricted ourselves to a close look at specific industries that in our experience are currently playing a key role in the economic development of Bulgaria, Croatia and Romania.