The Impact of Foreign Direct investment on Economic Performance in the Enlarged Europe

Foreign direct investment (FDI) inflows in 2011 increased in all major economic groups, developed, developing and transition economies (UNCTAD, 2012). Developing countries accounted for 45 per cent of global FDI inflows in 2011, of which East and South-East Asia accounted for almost half. Inflows to the transition economies of south-east Europe, the Commonwealth of Independent States (CIS) and Georgia accounted for 6 per cent. In fact, the overall increase was driven by East, South-East Asia and Latin America. In 2011 FDI outflows to developed countries also grew strongly, reaching $748 billion, up 21 per cent from 2010. FDI flows to Europe increased by 19 per cent, mainly owing to large cross-border mergers and acquisitions (M&As) by foreign multinational corporations (MNCs)