ABSTRACT
This chapter highlights some of the issues concerning policy towards Foreign direct investment (FDI) in Central and Eastern Europe (CEE) within the context of the fundamental economic and socio-political transition which the region as a whole is experiencing. It focuses on a select range of policies—ie. those designed to promote inward investment explicitly. Given the diversity of economic, political and social conditions prevailing in CEE, and the continuing state of flux, the observations in the chapter must be regarded as preliminary and tentative. The role of FDI in transition economies is the subject of debate regarding both the process of privatisation and longer-term effects on economic development. FDI is regarded as a major factor in a range of restructuring processes and the related aim of demonopolisation. In general, there is a very high level of competition between and within CEE economies; national and local governments clearly see FDI as a major factor in the successful transition to a market economy.
