Centre for Economic and Regional Studies Hungarian Academy of Sciences Centre of Excellence

After peak-FDI: what development strategy for middle income CEE economies? - ETUI workshop

09/15/2016 - 09/16/2016

This follow-up project builds on the findings of the 2014-15 research on FDI trends and patterns and examines what could be the future drivers of the economic catching up process in Central Eastern European transformation economies after 20 years of FDI driven development.

Some lessons of the previous research phase:

- FDI inflow to emerging economies including also the CEE region has been on a persistently downward trend in the last years.
- The big wave of the reorganisation of the division of labour in Europe after enlargement has come to the end of its cycle. Mass privatization programmes had been running out, in a number of countries re-nationalisation strategies emerge.
- Profit repatriation of existing multinationals has become an important factor.

The main questions to be answered by our new research project, are as follows:

•    What are the chances and requirements for an 'upgrading' process of the role catching up economies play in the international division of labour? Are there corresponding government strategies emerging? Are there signs of an 'upgrading' process already?
•    Are there new developments in the strategies of multinational companies emerging that suggest a new concept how industry is being re-organised?
•    Is digitalisation and the concept of industry 4.0 involve new strategic approaches that affect to role of peripheral economies and supplier networks?
•    Is an emergence of national capital, national champions to be expected (as it is in the centre of the Hungarian government policy for some years now and the new Polish government apparently intends to turn in this direction)?
•    Is the indigenous SME sector taking up the challenge in international competition and able to play a dominant role in the supplier networks of existing multinationals? Are there locally based multinationals emerging?
•    What government policies are emerging as regards foreign investment enterprises, whether it is the attraction of more FDI or more upgrading of local value added is in focus. Is strengthening domestic enterprises in contrary to multinationals or more policies that aim strengthening local suppliers to multinationals are in policy focus?  Are re-nationalisation strategies also likely to emerge? Are the policy discussions on potential alternatives to FDI led development emerging?
•    What are the appropriate industrial policies to support industrial upgrading and economic convergence?
Our approach will be based on the sectoral and country specific results of FDI patterns that emerged from the previous project. This will be supported by further literature review.

Tentative programme (to be specified):

15th September 2016

arrival of participants
12h lunch
13.30h Opening (KRTK representative)
Introduction, objectives of the project (Jan Drahokoupil, Bela Galgoczi, ETUI)
Discussion
15.00h coffee break
15.30h After peak FDI: Investments, upgrading, home grown multinationals
Presentation of interim research results by chapter authors:
Gabor Hunya, Andrea Szalavetz, Magdolna Sass
17.30h end of the first day
19.00h Joint dinner

16 September 2015

9.30h Innovation capacity and skills development in CEE
Presentation of interim research results by chapter authors /continued/
Marzenna Weresa, Mark Knell, Martin Ferry
11h coffee break
11.15h Future drivers of economic development and industrial policy in CEE
Presentation of interim research results by chapter authors /continued/
Juraj Drexler, Ales Chmelar, Zhelyu Vladimirov
13h lunch
14.00h Wrap up and future steps (ETUI)
15.00h End of the conference

Helyszín: MTA KRTK Institute of Economics 1112 Budaörsi út 45, Budapest