Withdrawing from the East

Whenever travelling to Eastern European countries I really feel like I am in a different world. Until I see all the different signs of German companies: Deutsche Bahn on polish rails, Germany car factories everywhere, Lidl can be find on every corner, and even Deutsch Bank is going east!

The Trend to invest more and more into Eastern European countries developed about 10 years ago with Bundeskanzler Gehard Schröder maintaining good relations with Russia and reducing skepticism towards the East. If you are curious about German investments to Eastern Europe about 10 years ago read “Ownership, Capital or Outsourcing, What drives German investment to Eastern Europe”  , a paper presented in 2002.

However, with recent political events German companies are deciding to withdraw their investments from many Eastern European countries. The German energy company E.O.N., for instance, felt forced to withdraw from Hungary out of political reasons as Victor Orban tries to nationalize energy in his country (source) . This seems a very good example of how recent politics affect the attractiveness of Eastern Europe as an industrial location in a negative way.



Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google+ photo

You are commenting using your Google+ account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )


Connecting to %s

%d bloggers like this: