ABSTRACT
Internationalisation has been one of the critical dimensions of the economic transformation undergone by the former centrally planned economies (CPEs). Openness and global interactions have had profound direct effects on their growth and development, and entry into international economic institutions has significantly shaped both domestic policies and institutions.
This chapter presents an overview of the challenges and outcomes associated with the reintegration of the former communist economies into the larger international system via increased openness to trade and investment, relaxation of controls on cross-border flows of labour and capital, and integration into the European Union (EU) and international institutions like the World Trade Organization (WTO), the International Monetary Fund (IMF), the World Bank and others. It begins by considering why autarky was central to the communist system and what internationalisation offered the Central and Eastern European (CEE) economies once they embarked on the transition to the market. It then looks at the various dimensions of internationalisation before comparing the internationalisation paths taken by different groups of CEE countries and their outcomes.
