Bulgarian Capital Pulls Above Its Weight

sofia

A major new report carried out by See News for the Sofia Investment Agency shows that more than one in five Bulgarian workers is employed in Sofia. The unemployment rate in the capital has decreased by almost a third over the past four years and is now just 3.8 per cent, well below the national average of 6.2 per cent. Sofia also accounts for a staggering 40 per cent of Bulgaria’s total GDP, and is currently enjoying growth of 7.7 per cent. Growth for Bulgaria as a whole is less than half of that, albeit at a still impressive 3.4 per cent. In 2016, 52 per cent of all foreign direct investment to Bulgaria went to Sofia.

Continue reading Bulgarian Capital Pulls Above Its Weight

Outsourcing Sector Driving CEE Office & Graduate Demand

wroclaw office

More than 60 per cent of the demand for office space in four major CEE cities – Warsaw, Lodz, Krakow and Sofia – during the first half of 2017 came from the outsourcing sector. That is one of the key findings of a major new report published on December 14 by Colliers, one of the region’s largest real estate agencies. The report claims that the demand for office space is itself being driven by the ready availability of skilled workers, but also warns that the stock of highly-qualified graduates is not inexhaustive.

Continue reading Outsourcing Sector Driving CEE Office & Graduate Demand

Estonia: Europe’s Little Technological Giant

Estonia is in the last month of its EU presidency. Having called itself the ‘digital presidency’ it is not surprising that many of the themes of this past month are digital: progression on the taxation of the digital economy and the free movement of data, approval of an ecommerce VAT package, and an agreement on further steps to develop 5G networks across Europe.

Continue reading Estonia: Europe’s Little Technological Giant

Bucharest’s Stock Exchange Reports Growth; Eyes Emerging Market Status

bucharest stock exchange

Three high-profile initial public offerings (IPOs) have had a hugely positive impact on the primary Romanian stock market this year, the Bucharest Stock Exchange (BSE).  The BSE’s BET has grown by 20 per cent this year, while liquidity through the first nine months of 2017 has improved by 33 per cent compared to the same period last year.

Continue reading Bucharest’s Stock Exchange Reports Growth; Eyes Emerging Market Status

Poland’s New PM Defends Attacks on Justice System

warsaw supreme court

Amidst fierce criticism from abroad and protests at home, Poland’s newly appointed Prime Minister Mateusz Morawiecki published an English-language opinion editorial in the Washington Examiner on December 13 defending the government’s attacks on the independence of the judiciary. Mr Morawiecki claims that criticism stems from “widespread misunderstanding of our plans to reform Poland’s deeply flawed judicial structure.”

Continue reading Poland’s New PM Defends Attacks on Justice System

Romanian Inflation Hits Four-Year High

supermarket, prices, inflation

Consumer prices in Romania were up 3.23 per cent in November on the same month in 2016, the country’s National Institute of Statistics (INS) announced on December 12. The figure is the highest for more than four years, with prices up 0.66 per cent on October. The increase has been caused by the sharp growth in price of a number of everyday goods (particularly eggs and dairy products), as well as energy. High interest rates, and the unfavourable leu-euro exchange rate have also placed upward pressure on prices.

Continue reading Romanian Inflation Hits Four-Year High

Ukraine’s Anti-Corruption Boss Survives, For Now

Artem Sytnyk

Ukraine’s National Anti-Corruption Bureau (NABU) has said that any attempt to limit its independence will cause irreversible consequences for the country’s fight against corruption. On December 6, only the intervention of activists and reformist, mainly opposition MPs who worked tirelessly overnight to remove a bill from parliament that would have stripped NABU of its independence and unseated its boss, Artem Sytnyk. Pressure from western partners also appears to have been crucial in convincing the authors of the bill, mainly MPs from parties loyal to Ukrainian President Petro Poroshenko and former Prime Minister Arseniy Yatsenyuk, from withdrawing it.

Continue reading Ukraine’s Anti-Corruption Boss Survives, For Now

What Went Wrong in Ukraine – And When?

Mariia Chaplia

Mariia Chaplia

Since the annexation of Crimea and the beginning of the ongoing war with Russia, Ukraine has been branded as a villain seeking foreign assistance. With National Bank reserves of 5 billion euros and a public debt equal to 80.2 per cent of GDP, Ukraine will have to repay 38 billion euros of EU loans over the next five years. As with people, help from the outside usually brings bad results if there is no incentive to take responsibility over one’s own future by reflecting on past mistakes. So what went wrong for Ukraine – and when?

Continue reading What Went Wrong in Ukraine – And When?

Poland & Ukraine Should Join Outsourcing Forces

outsourcing

Poland and Ukraine, the two largest countries in Emerging Europe, should jointly promote themselves as an outsourcing destination.

“They should create an outsourcing hub and complement one another in their offer,” Iwona Chojnowska-Haponik, director of the Foreign Investment Department at the Polish Investment and Trade Agency (PAIH), during the second Polish – Ukrainian Outsourcing Forum in Rzeszów, Poland, organised by the Pro Progressio Foundation.

Continue reading Poland & Ukraine Should Join Outsourcing Forces

Assaults on the Judiciary: How CEE Governments Are Trying to Restrict Judicial Independence, and Why It’s Not Working… For Now

poland romania justice system
Christopher Lehmann

Christopher Lehmann

Judges in central and eastern Europe are under attack.

The most frightening thing about this is that the judges are under attack from their own governments. The authoritarian, populist style governments arising across the region have repeatedly shown that they seek to curtail and control judicial independence, subjecting judges to direct governmental control and limiting their ability to act independently. As an independent branch of the state, the judiciary poses a potential obstacle to those bent on the consolidation of power. The assault on an independent judiciary is part of a larger trend, documented across the region, to stifle dissent, whether it comes from civil society, the media, opposing political factions, or judges acting as an independent check on government actions.

Continue reading Assaults on the Judiciary: How CEE Governments Are Trying to Restrict Judicial Independence, and Why It’s Not Working… For Now

Michael: The Last King of Romania

He was king before – and after – his father. He was one of the last people alive to have met Hitler, Mussolini and Churchill but not, as has been reported, the last World War II head of state: Simeon II of Bulgaria survives him. He was certainly the last king of Romania. Any hope the country’s monarchists had of restoring the throne were dashed in 1990 when the neo-communists who took over Romania in the wake of the 1989 revolution prevented the exiled king from even entering the country. His legacy is not great: a feuding family, no clear line of succession. To all intents and purposes the Romanian royal family dies with him.

Continue reading Michael: The Last King of Romania

Women, to Tractors!

Tug of war contest between boys and girls. Two groups of children of different sex pulling opposite ends of rope. Concept of gender equality among kids, team sports. Vector illustration for banner

“If we’re too tough, we’re unlikable. If we’re too soft, we’re not cut out for the big leagues. If we work too hard, we’re neglecting our families. If we put family first, we’re not serious about work. If we have a career but no children, there’s something wrong with us, and vice versa. If we want to compete for a higher office, we’re too ambitious.” So writes Hillary Rodham Clinton in her new book analysing What Happened in the 2016 presidential election. Continue reading Women, to Tractors!

Mobilising Private Sector Investment in Belarus, Moldova & Ukraine

IFC

Having taken over a difficult role in April 2017, Jason Pellmar, head of the Ukraine, Belarus and Moldova regional office of the International Finance Corporation, the private sector arm of the World Bank Group, talks to Andrew Wrobel about the opportunities offered by the three countries, and some of the challenges he may face. Continue reading Mobilising Private Sector Investment in Belarus, Moldova & Ukraine

Ex-Banker to Become Poland’s Next Prime Minister

Government reshuffles continue. On the morning of December 7, Polish Prime Minister Beata Szydło, remained in office when she survived an opposition motion of no confidence,Law and Justice (PiS) deputies voting the motion down. Ten hours later however, she resigned. After a meeting of the governing party its spokesperson, Beata Mazurek, confirmed the political committee had decided to appoint Mateusz Morawiecki, erstwhile deputy prime minister and minister of finance and economic development to replace Mrs Szydło.

Continue reading Ex-Banker to Become Poland’s Next Prime Minister

Investment in Croatia’s Regions Key to Further Development

CAKOVEC, CROATIA - JULY 02: Parish Church of Saint Nicholas in Cakovec, Croatia, on July 02, 2016.

Improving the business climate is like sport. You cannot win every race, says Zdenko Lucić, who since March 2017 has been the managing director of the Croatian Agency for Investment and Competitiveness. He talks to Andrew Wrobel about investment opportunities in Croatia, which he believes will continue improving its Doing Business ranking in the long run.

Croatia experienced something of a recession a while back, but the economy is doing better and better. How do you see it developing over the next couple of years?

Yes, we were in a recession. But over the last two years things have been improving and we have seen a significant increase in GDP. This year growth is around 3 per cent. This growth is based on investments, and business activity in general. I believe that in the next few years growth will be steady, and that we will recover what we lost in the years of recession. Hopefully, it’ll be much better than before. Things are looking optimistic.

What are the biggest challenges Croatia currently faces?

The biggest challenge is the use of skills and the availability of people. Croatia has a slightly higher unemployment rate than we would like. This is an opportunity for foreign companies looking to invest in Croatia. For example, in 2016, IBM decided to locate its client innovation center in Zagreb because they found out that they will have enough workers for it. They plan to create 500 new jobs that will serve the global market.

Croatia is perceived much better than it was maybe 20 years ago, but another challenge is to capture more international companies to open their facilities in Croatia. That’s why we’re promoting Croatia internationally as a business and investment destination.

You mentioned access to the labour force. Internally, what are you struggling with currently?

The challenge is to have an even distribution, or even regional development. Zagreb is the magnet for the entire region. We want to promote investments in less developed regions, for example, in the east where the unemployment rate is close to 30 per cent, where you have a skilled work force in ICT, engineering, and metal processing. That’s the goal:  to get more and more high-quality investments in those locations.

Zdenko Lucić
Zdenko Lucić (source: AIK)

How are you encouraging investors, both local domestic and foreign ones, to look at these other areas?

Within our Investment Promotion Act, we provide more generous investment incentives, for example employment incentives, in regions with a higher unemployment rate. We provide more direct grants for companies investing in high tech equipment in less developed regions, while the government started a project called Slavonia, which is the eastern part of Croatia, where billions of euros are available through EU funds for the development of less developed regions. This is an excellent example of how the government pushes or encourages investment in less developed parts of Croatia.

Is it working?

Yes, it’s working well. The usage or the use of EU funds is increasing. The absorption of EU funds increased tremendously comparing to previous years. We’re trying to improve the system in order to further increase the use of the funds. We want to speed it up in order to receive more from the EU.

Given that we’re talking about the EU, Croatia has been a member for almost five years. How has the country changed?

Some changes are in regards to the increased development of infrastructure, where most of the costs are covered by EU structural funds. Regarding investments and attractiveness of Croatia, we’re seeing a shift towards us because Croatia is more attractive to investors. For example, companies that invested in Croatia over the last two or three years were not interested before we were part of the EU. Thousands of new jobs have been created thanks to EU membership and new market opportunities.

How is Croatia differentiating itself from neighbouring countries?

Some of our neighbours are EU member states, such as Slovenia, Hungary, and of course we have a maritime border with Italy. Then of course we have borders with non-EU members, like Serbia, Bosnia and Herzegovina and Montenegro.

Compared to other countries, Croatia was always a part of Central and Western Europe going back through history. Our economy and our trade balance, industry, tourism, have always been very much bonded with economies of Central and Western Europe, comparing with economies of the other countries in the region. If we look geographically, Zagreb is further west than Vienna, for example.

How about doing business? In the World Bank’s Doing Business 2018 report, the country ranked 51st, down by eight compared to 2017.

This year, we experienced a fall in our Doing Business ranking. We had a couple of good years, improving from 124th to 89th, and up to 40th. Now we’ve slipped down a little bit in the ranking. It’s not that we haven’t made do any improvements. We have, and they were acknowledged in the report. But other countries were implementing change faster.

But it’s like a sports game. You cannot win every race. In the long run, however, we believe that Croatia will improve its ranking. We are taking steps to improve the business environment. For example, tax reforms implemented in January this year were not taken into consideration for the latest Doing Business report. Next year, we believe that these improvements will be recognised by the World Bank and will definitely lead to an improvement in our ranking, because the tax burden for companies has been reduced.

You mentioned you’d like more investment outside Zagreb. How do you see the development of infrastructure in the country?

Regarding business, and transportation infrastructure, you’ve probably traveled to countries in the region. When you travel by car, there’s an obvious difference when you cross the border. You see that in much of Croatia you have highways, but in some parts of some countries, you don’t have developed highway infrastructure. Also, business infrastructure: while much of Croatia is covered with high-speed internet, some areas of neighboring countries do not have that.

There are some investors who are looking to invest in countries that are less developed because they are hungrier for lower costs and for more profits. When you race to the bottom, eventually you’re going to lose. If you want to be the cheapest destination, in the long run that’s not feasible. We believe that we’re the best cost destination. The cost of doing business in Croatia is not as low as in less developed countries, but it is significantly lower than in developed countries. For example, many Italian, German, Austrian, French companies choose to come to Croatia because they will get the best value for their investment. They have the choice to go further east. But going to less developed areas with less developed democracies, less developed judiciary system, less developed business infrastructure, you’ll have higher risk and potentially higher costs.

Ericsson has 3,000 employees in Croatia. Of those, 1,200 are employed in research and development in Zagreb and Split. Some years ago, it was the most profitable unit within the group. Good business can be done in Croatia. We’re not the cheapest, but we’re the best cost destination, providing excellent service at reasonable cost.

Zdenko Lucić (source: AIK)

Which sectors are you currently interested in promoting, where you think foreign investors could benefit?

First of all the tech sector: IT, engineering, electronics. Then manufacturing: metal processing, production of plastic parts and components. Other sectors such as tourism are also interesting. Tourism is driven by the natural beauty of the country. Then there is the pharmaceutical sector, which has been booming in Croatia over the last couple of years. For example, the biggest pharmaceutical companies have opened or expanded production sites in Croatia. And now they’re investing further and setting up R&D sites. For example, Hospira, one of the biggest pharmaceutical and medical device company, recently bought by Pfizer, has a huge site in Croatia and they are growing constantly. Teva, Galapagos, Xelia Pharmaceuticals were investing in Croatia significantly and they are still growing.

Let’s imagine you have a foreign fan of Croatia who’d like to invest in the tourism in the country. What opportunities does he have?

It depends on the type of investment you prefer. If you want to build a city hotel, locate it in Zagreb for business purposes, then this is a good opportunity because Zagreb tourism and business arrivals are increasing by two digits per year. If you want to provide a facility for leisure activity, you’ll need to go to the coast, where around 90 per cent of tourists are coming.

What is now in further development is the idea of Croatia as a year-round tourism destination. The seaside is of course seasonal, but for somewhere like Dubrovnik the season is much longer. Zagreb, with a combination of business travel and tourism, has always been a year-round destination.

We have also invested a lot into airport infrastructure over the last couple of years. In March, a new terminal opened at Zagreb. It was constructed by an international consortium. Dubrovnik Airport is expanding. They have received a grant from EU structural funds, over a of hundred million euros. Split Airport too is developing, as is Zadar and all the international airports in Croatia are developing. With the current consortium managing Zagreb Airport, we believe that we’ll have more flights, more destinations connecting to Croatia.

We are in London now, promoting Croatia. Why is London important? Why do you want to attract British Investors? Is Brexit not a concern?

Great Britain is one of the world’s leading economies. Brexit, for Croatia, might be an opportunity for companies that want to stay within the European Union, that want to have a sort of nearshore location close to Britain, but still in the EU. We believe that Croatia — with its benefits, human capital and business infrastructure — can be a good base for these companies.

Warsaw Back on Top in Polish Banking

WARSAW, POLAND - MAY 07, 2016: Building Palace of Culture and Science among the modern buildings of the city

Goldman Sachs is expecting to hire around 250 staff in Poland, primarily in operations and technology, risk management, treasury and human resources, all back office roles which do not have to be located in more expensive locations. According to the Polish Association of Business Service Leaders, outsourcing centres opened in the country by foreign companies have added 198,000 jobs so far.

Continue reading Warsaw Back on Top in Polish Banking

Skiing in Emerging Europe

gudauri ski georgia

With the first snows of the winter having already fallen across Emerging Europe, many people’s thoughts would have already turned to winter holidays, and to skiing. While for many the countries of the region are not the first to spring to mind when planning a ski trip, there are in fact a number of very good ski resorts in this part of the world. From Jasna in Slovakia to Tsakhkadzor in Armenia, many offer some superb, rugged skiing amidst fantastic scenery, usually at prices well below those in Western Europe. Not that the low cost is the only attraction. For a new breed of adventurous skier, jaded perhaps by the increasingly busy motorway pistes of France, Switzerland, Austria and Italy, the search for fresh powder, for empty slopes and for new experiences is the real draw. That’s where Emerging Europe comes in, and that’s why our editor-in-chief Craig Turp, who has skied in more countries than most people have visited, decided to put together this short guide to skiing in some of the region’s top – and in some cases surprising – locations. Continue reading Skiing in Emerging Europe

Emerging Europe Looking Good in Best-Performing Cities Index

Budapest, Hungary. Aerial view of the old city Budapest, Hungary with river and Parliament Building with cloudy blue sky

Nine cities in Central and Eastern Europe feature amongst the first 20 in the Best-Performing Cities Europe Index, published on December 4 by the Milken Institute. The report used outcomes-based metrics including job creation, wage gains, manufacturing, and skilled service industry concentration to evaluate the relative performance of European regions.

Continue reading Emerging Europe Looking Good in Best-Performing Cities Index

EBRD Transition Report Highlights Financial Sector Resilience

Baku

The EBRD’s latest Transition Report: Sustaining Growth, issued at the end of November, has highlighted a welcome upturn in the pace of reform in emerging economies where the bank invests, four years after reporting that reforms were stalling or even being thrown into reverse. The EBRD also unveiled a new set of investment criteria for its projects, ensuring that its countries of operations are more competitive, better governed, greener, more inclusive, more resilient and more integrated. The six criteria are: reforms aimed at making economies more competitive; good governance; green transition; inclusion; resilience; integration.

Continue reading EBRD Transition Report Highlights Financial Sector Resilience

Slovenia: Emerging Europe’s Hidden Giant

ljubljana slovenia

Slovenia is Emerging Europe’s leader in the number of ‘hidden champions’  — 3.5 per one million inhabitants. As defined by Professor Hermann Simon, a German business leader and author, hidden champions are firms that are market share leaders — amongst the world’s top three or number one in the continent, with turnover below 1 billion euros and yet not generally known to the public. Poland has only 0.7 such businesses per 1 million inhabitants, the Czech Republic and Hungary each 0.4.

Continue reading Slovenia: Emerging Europe’s Hidden Giant

CEE: Innovate or Get Eaten

innovation
Eszter Szabó

Eszter Szabó

I have always been amused by the geography of regions within global companies. Names like Central Europe, Central and Eastern Europe and East Europe have always meant different things to different companies. My favourite was when a global company’s Eastern European region included Switzerland. Why? Because the regional head’s family lived there, so it was added to CEE. Continue reading CEE: Innovate or Get Eaten

Double Ratings Agency Boost for Bulgaria

Two key credit rating agencies, S&P and Fitch, both raised Bulgaria’s credit rating on December 1, lowering the Balkan state’s cost of borrowing and sending a strong signal that the country’s current bout of growth was both real and sustainable. S&P raised its sovereign credit ratings on Bulgaria from BB+/B to BBB-/A-3, while Fitch upgraded Bulgaria’s long-term foreign- and local-currency issuer default ratings from BBB-minus to BBB.

Continue reading Double Ratings Agency Boost for Bulgaria

Polish Government in Climbdown on Social Contribution Hike

Faced with heavy criticism from the business community and even the Social Insurance Institution (ZUS; which would have been the main beneficiary), Poland’s government has been forced to backtrack on plans to remove the upper threshold for the payment of social contributions from January 1, 2018. This despite the proposed legislation being at an advanced stage.

Continue reading Polish Government in Climbdown on Social Contribution Hike

Investors Eye Opportunities in Emerging European Infrastructure

infrastructure

The Czech Republic is the most attractive destination in Emerging Europe for investment in infrastructure, a new report from CMS claims. The Czech Republic, which ranks 13th out of 40 countries surveyed, is about to embark on a major programme to modernise its train stations, has allocated approximately 384m euros to the scheme. “The infrastructure market has high hopes for Central and Eastern European countries, whose economies are currently experiencing a great expansion,” states the report.

Continue reading Investors Eye Opportunities in Emerging European Infrastructure

World Bank: Western Balkans Need to Speed Up Growth For Faster Convergence

world bank

It will take as many as six decades for income levels in the Western Balkans to catch up with those of the European Union (EU) if economies in the region continue to grow at the average speed achieved between 1995 and 2015, says the World Bank’s Western Balkans: Revving Up the Engines of Growth and Prosperity report, looking at how Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and Serbia can speed up economic growth and achieve faster income convergence with the EU.

Continue reading World Bank: Western Balkans Need to Speed Up Growth For Faster Convergence

The End of Poland’s Shale Gas Eldorado

Shale gas exploration in Poland has come to an end. San Leon, an Irish firm which in 2014 was the operator of 24 and a shareholder of 11 licences to explore oil and gas reserves — both conventional and unconventional (such as shale gas), has returned the last two shale gas licenses it held to Poland’s Ministry of the Environment. The company, which was the country’s biggest shale gas enthusiast, could have continued exploration until 2020, but has not found any partners interested in doing so.

Continue reading The End of Poland’s Shale Gas Eldorado

China and Central Europe: Don’t Believe the Hype

China
Tomáš Valášek

Tomáš Valášek

Anytime Beijing ventures into intra-European relations, trepidation ensues. The “16+1” meeting between Beijing and a group of Central and East European states on November 27 brought particular interest. The goal was to discuss Beijing’s investments in the region. But the event coincided with rise of populism in Central Europe, which, in turn, has spawned tensions between the EU’s newer and more established states. China has been blamed for exploiting these divisions, and for trying to break EU consensus on subjects that matter to Beijing. But on closer inspection, the rising power’s influence is less than it appears.

Continue reading China and Central Europe: Don’t Believe the Hype

Visegrád Divided

visegrad
Edit Zgut

Edit Zgut

Ever since central Europe’s transition to democracy, the Visegrád Group (V4) has been a cooperative project based on the principle of costs and benefits. In recent times however, the complex political processes within the European Union have brought new challenges to the group, and divisions within it might well be made permanent by increasingly diverse views on the institutional future of the EU.

Continue reading Visegrád Divided

Albania’s Economy Not Benefiting From Largest Oil Reserves in Region

Albania is the largest producer of crude oil in the Western Balkans, according to the Institute of Energy for South-Eastern Europe. The Albanian Energy Association (AEA) estimates the country to have relatively high oil reserves of up to 400 million tons, although further investment is required for research and development.

Continue reading Albania’s Economy Not Benefiting From Largest Oil Reserves in Region

OECD: Tightening Labour Markets Sustain Growth in Emerging Europe

workers, employment

The world economy has strengthened, with monetary and fiscal stimulus underpinning a broad-based and synchronised  improvement in growth rates across most countries, according to the Organisation for Economic Co-operation and Development’s (OECD) latest Economic Outlook, published on November 28. For those emerging European countries which are members of the OECD (Czech Republic, Estonia, Hungary, Latvia, Lithuania, Poland, Slovakia and Slovenia) a common theme of the report is an increase in growth driven by consumption, itself powered by tightening labour markets.

Continue reading OECD: Tightening Labour Markets Sustain Growth in Emerging Europe

Hungary Seen as Riskiest Country in CEE

risk

Government investigations and regulatory compliance are increasingly concerning issues for businesses operating in the CEE market. This is according to the latest Central and Eastern Europe: Risk & Resilience report, published on November 23 by international law firm CMS and Legal Week, which canvassed the views of more than 40 in-house counsel on the region’s business potential and how to mitigate risks.

Continue reading Hungary Seen as Riskiest Country in CEE

The Azerbaijani Laundromat: Why It Matters

azerbaijani money laundering
Audrey L Altstadt

Audrey L Altstadt

Money laundering may not be theft, but it is a product of theft. Sources of laundered money may include illegal activities such as trafficking in drugs or humans, or it may be diverted income from natural resources, inflated costs, bribes, fake loans, or other financial manipulation. The money might be stolen from the state, in the form of unpaid taxes or other charges, or from the people of a country – as with stolen revenues from the sale of natural resources from oil to diamonds. Money laundering thus reflects economic and moral damage to individuals and institutions and thereby threatens the stability and security of states, societies, and regions.

Continue reading The Azerbaijani Laundromat: Why It Matters

Regional News Outlets: The Real Target of Poland’s New Media Law?

poland media

Poland’s government has made no secret over the past 12 months of its plans to change media rules in a such way that could force some foreign owners out of the country. Despite criticism from both the European Union and human rights groups including Amnesty, Poland’s Deputy Culture Minister Paweł Lewandowski said as recently as August 2017 that while the new law (which he is helping to draft) would stop short of ‘re-Polonizing’ the nation’s media, it would nevertheless impose rules limiting ownership on groups whose cross-platform holdings and market share are deemed ‘dominant.’

Continue reading Regional News Outlets: The Real Target of Poland’s New Media Law?

EU May Offer Georgia, Moldova and Ukraine Customs Union and Schengen Access

schengen

Georgia, Moldova and Ukraine may soon join the European customs union and Schengen area, gaining increased access to the single market. The European Parliament passed a resolution on November 15 calling for deeper integration with the three emerging Europe states as they implement more reforms, potentially paving the way for them becoming candidate countries.

Continue reading EU May Offer Georgia, Moldova and Ukraine Customs Union and Schengen Access

Does the Sceptre of Separatism Haunt Emerging Europe?

Szekely Land Flag
Magdalena Dembinska

Magdalena Dembinska

There is much talk in Europe at the moment about the potential spread of separatist movements, a consequence of Catalonia’s referendum on independence. A number of maps have appeared on the internet pointing to various regions which may be next in line. The spectre of disintegrating states haunts some European Union states and is perceived (or instrumented) as a threat by others. In the eastern part of the EU, there is much talk about the case of the Silesians (some even mention the Kashubians) in Poland, the Hungarians of the Székely Land in Romania and Slovakia, Moravians in the Czech Republic, Russians in Latgale (Latvia), and the historical region of Samogitia in Lithuania.

Continue reading Does the Sceptre of Separatism Haunt Emerging Europe?

Retail Rents Rise Across Emerging Europe

Na Prikope Prague

Prague’s Na Příkopě and Pařížská are the most expensive retail streets in emerging Europe, with monthly rents averaging 220 euros per square metre. Kaunas is Europe’s most affordable retail location, with annual rents standing at just 174 euros per square metre. The figures were published on November 16 in a major new report prepared by real estate agency Cushman and Wakefield.

Continue reading Retail Rents Rise Across Emerging Europe

Go East

Craig Turp

Craig Turp

Some people blame their parents for what they later become in life. I am certainly no different. Back in the early 1990s my father suggested that I should ‘Go east. That’s where the opportunities are.’ With those words in mind I enrolled at the School of Slavonic and East European Studies to study Romanian language and literature. More than two decades on things have not turned out too badly. Neither for me nor the region.

Continue reading Go East

Kaczyński Defends PiS Record

Poland’s governing party, Law and Justice (PiS) continues to herald its multiple successes two years after the party won a general election. First, the party’s leader Jarosław Kaczyński gave a special interview to state-owned and government-managed TVP, then he and Prime Minister Beata Szydło threw an unexpected press conference, but didn’t take any questions from media representatives. Continue reading Kaczyński Defends PiS Record

e-Estonia: Believe the Hype

Since leaving office Toomas Ilves, president of Estonia from 2006-16 and driver of the Baltic state’s world-leading initiatives in e-government and cyber security, has become a roving advocate for digital government. Early in November he told the 2017 edition of the Microsoft Summit that those countries wanting to emulate Estonia need to “mind the gap” between the pace of digitalisation in the private and public sectors.

Continue reading e-Estonia: Believe the Hype

Chinese Electric Car Maker Seeks Emerging Europe Base

zhi dou d2

Confirming China’s increasing interest in emerging Europe, electric car manufacturer Zhi Dou is reportedly looking for a location to build a new plant, with Slovakia one of its preferred options. Zhi Dou, which is part of the Zhejiang Geely Holding Group, wants to start building cars by 2020 in a new facility which will reportedly cost around 400 million euros.

Continue reading Chinese Electric Car Maker Seeks Emerging Europe Base

Georgian PM Reshapes and Reshuffles Cabinet

Giorgi Kvirikashvili

In a move designed to cut red-tape and bureaucracy, the Prime Minister of Georgia Giorgi Kvirikashvili announced a number of significant changes to the make-up of his cabinet on November 13. In the biggest move, the Ministry of Energy and the natural resources management component of the Ministry of Environment and Natural Resource Protection will be incorporated into one ministry: the Ministry of Economy and Sustainable Development. This new mega—ministry will be led by Dimitri Kumsishvili, first deputy prime minister and erstwhile minister of finance.

Continue reading Georgian PM Reshapes and Reshuffles Cabinet

Budapest’s Property Boom Goes Nationwide

building

According to estimates made by the National Bank of Hungary (MNB), house prices in Budapest have increased by 15 per cent since 2015. The figures appear in the latest MNB Housing Market Report, which states that prices are expected to rise further, albeit at a slightly slower rate. However, the report also notes that property prices remain below the level justified by macroeconomic fundamentals. What’s more, 41 per cent of new development projects are currently delayed, with a large number of completions of new dwellings now expected to appear on the market at the end of 2018.

Continue reading Budapest’s Property Boom Goes Nationwide

Continental Launch Largest Ever Lithuanian Greenfield Investment

kaunas lithuania

The German tyre and technology company Continental is to build a new manufacturing facility in Kaunas, Lithuania to expand its automotive electronics production footprint. Work on the new plant, which will bring in investment of 95 million euros over the next five years will begin in mid-2018. The project is the largest greenfield investment in Lithuania’s history, and once fully operational the plant will employ more than 1000 people.

Continue reading Continental Launch Largest Ever Lithuanian Greenfield Investment

Budget Chaos Hits Romanian Leu

Different Romanian Lei Banknotes on the table

Business and opposition leaders, trade unionists, small firms and even local councils across Romania have condemned an emergency ordinance (OUG) passed by the country’s government on November 8 which transfers the responsibility for paying social contributions from employers to employees. It is claimed that the changes, which take effect from January 1, 2018, will lead to additional costs for business and may mean that workers take home less money each month. Some companies may even be forced to lay workers off. The Romanian currency, the leu, moved past the psychologically crucial 4.6 lei to the euro barrier even before the OUG had been formally approved, hitting its lowest level for over five years.

Continue reading Budget Chaos Hits Romanian Leu

Bulgaria and Romania Get EBRD SME Boost

Startup Diversity Teamwork Brainstorming Meeting Concept

The European Investment Advisory Hub (EIAH), the EBRD and the European Union has launched a new programme committed to helping SMEs get better access to advice for sustainable growth. Tailored business advice will be made available to more than 240 SMEs across Bulgaria and Romania, as well as Greece. The expertise on offer will cover a wide range of areas including strategy, trade promotion, financial management, energy efficiency and marketing.

Continue reading Bulgaria and Romania Get EBRD SME Boost

Emerging Europe to Record Positive Growth Across the Board in 2018

coins growth

All 23 economies of emerging Europe are set to record positive growth in 2018, led by Georgia, whose GDP is seen as growing by more than 4.2 per cent. Even Azerbaijan, whose economy has contracted for the past two years, is seen as returning to modest positive growth in 2018. The regional outlook is stable, but a couple of places, notably Romania, are giving cause for concern.

Continue reading Emerging Europe to Record Positive Growth Across the Board in 2018

Measure, Strengthen, and Grow

dacia brand
Mihai Bogdan

Mihai Bogdan

Almost three decades since the fall of communism, emerging Europe brands still do not shine as bright as their western counterparts.

The latest Nation Brands report, published by Brand Finance, shows how Brand Romania, Brand Slovakia, Brand Bulgaria and other nation brands from emerging Europe are much weaker and less valuable than their western neighbours — and with a long way to go before they can carry their economies in times of distress. Perceived higher market risk has also been reflected in lower FDI and M&A flows over the past three decades.

Continue reading Measure, Strengthen, and Grow

All for One, and One for All

GE
Peter Stracar

Peter Stracar

The lead sentence from Dumas’s Three Musketeers, symbolising team work and cooperation towards a common goal, came into my mind at our recent event, the CEE Supply Chain Dialogue, organised with the participation of Hungarian, Polish, Croatian, Czech, Romanian, Serbian and Slovenian government organisations, investment agencies, and export banks. Our aim with the event was to discuss opportunities to better connect SMEs in CEE to the global economy via GE’s supply chain, and ways in which GE can catalyse and support this process. Clearly a case of ‘all for one and one for all.’

Continue reading All for One, and One for All

Baltic States to Launch Combined Capital Market

capital markets

The finance ministers of Estonia, Latvia and Lithuania announced on November 6 that they had agreed to create a pan-Baltic capital market to strengthen their economies and stimulate investment. Toomas Tõniste (Estonia), Dana Reizniece-Ozola (Latvia) and Vilius Šapoka (Lithuania) signed a Memorandum of Understanding in Brussels in which the three countries agreed to harmonise capital market regulations and dismantle investment barriers. All three Baltic States suffer from a number of constraints caused by the relatively small size of their markets: the agreement should help them overcome such limitations.

Continue reading Baltic States to Launch Combined Capital Market

CEE Lags in Business Connectivity

ANIS romanian ICT

According to Eurostat’s Digital Economy and Society report, 3 per cent of businesses in the EU still do not have an internet connection, with the highest share of these being found in Romania (16 per cent). The report also states that when it comes to mobile connectivity, there is a distinct gap between large businesses, of which 94 percent use a mobile broadband connection, and SMEs, only 69 per cent of whom make use of the technology.

Continue reading CEE Lags in Business Connectivity

‘Traditional Values’: A Potent Weapon Against LGBT Rights

gay rights putin
Graeme Reid

Graeme Reid

In April, news broke of a widespread anti-gay purge in Chechnya; in September, gay men and transgender women were rounded up in Azerbaijan; and in October reports emerged that a registry of gay men and lesbians was being compiled by the authorities in Tajikistan. How might we understand these disparate events as part of a trend in these three former Soviet countries?  

Continue reading ‘Traditional Values’: A Potent Weapon Against LGBT Rights

Poland’s Flying Circus

airport poland

Less than six years ago, Warsaw had only one airport — Okęcie — which has recently been expanded and in 2016 handled a record number of 12.8 million passengers. Today, there is Warsaw Modlin, located 40 kilometres north of Poland’s capital, served mainly by Ryanair flights, and Radom, about 100 kilometres south of the city, which opened three years ago at the cost of 120 million złotys (27.8 million euros) and recently lost its only regular carrier. Now the government is planning another airport in Stanisławów, some 45 kilometres west of Warsaw. The cost of the investment is estimated at 20 billion złotys (4.6 billion euros) and the first plane is scheduled to take off in mid-2027.

Continue reading Poland’s Flying Circus

IMF Urges Croatia to Speed Up Reform

croatia

The International Monetary Fund (IMF) has urged Croatia to accelerate the pace of structural reforms in order to improve competitiveness and mid-term growth prospects.

“Croatia’s convergence process has slowed down compared to its peers,” Elisabetta Capannelli, World Bank country manager for Croatia and Slovenia tells Emerging Europe. “Key reforms include those that would help create a favourable and predictable business environment and overall reduce the presence of the state in the economy, making it much more effective when companies should remain in public hands,” Elisabetta Capannelli, World Bank Country Manager for Croatia and Slovenia tells Emerging Europe.

Continue reading IMF Urges Croatia to Speed Up Reform

ICT Growth Continues to Boost Bosnian Economy

ict, it

The ICT sector, with over 420 firms, has been one of the fastest developing sectors in Bosnia and Herzegovina (BiH) over the last few years. According to the Foreign Investment Promotion Agency (FIPA), its share of the country’s GDP amounts to 80 million euros. In 2016, the number of IT people employed by ICT companies increased by 97 per cent compared to 2010, and net profits of ICT firms have doubled.

Continue reading ICT Growth Continues to Boost Bosnian Economy

Why Was Zapad-2017 So Important?

russian tank belarus zapad
Aliaksandr Papko

Aliaksandr Papko

The strategic joint military exercise Zapad-2017 took place from September 14-20 at several training grounds in Russia and Belarus. According to official statements, the total number of troops participating in this military drill was 13,000. However, the real figures could well have been significantly higher. The official scenario of Zapad-2017 was very close to that of previous Belarusian-Russian military exercises, which took place in 2011 and 2013. Belarusian and Russian troops were preparing to repel aggressive actions by their western neighbours, aimed at destabilising the situation in Western Belarus.

Continue reading Why Was Zapad-2017 So Important?

Montenegro Accelerates Legal Reform

montenegro law reform

With key support from the EBRD’s Legal Transition Team, Montenegro accelerated the reform of its legal framework at the end of October when it adopted new legislation covering financial leasing, factoring, purchase of claims, micro-credit and credit-guarantee issues by the state parliament. Montenegro’s legal and regulatory framework is now significantly better aligned with international best practice.

Continue reading Montenegro Accelerates Legal Reform

Euroscepticism in Serbia: An Image Problem?

Dragoljub Todić

Dragoljub Todić

It would likely make sense to search for the causes of the euroscepticism of the citizens of the Republic of Serbia and other similar states in the region in the specific features, length and effects of a social transition which has been going on for more than twenty years. Disappointment, unfulfilled expectations under conditions of radical social change, and confusion in the understanding and promotion of EU integration could be considered general causes. Radical changes of the economic, political, legal and any other system have been going on for too long.

Continue reading Euroscepticism in Serbia: An Image Problem?

Slovakia: Growth Continues But Problems Remain

Mixed messages in the world of Slovakian business. While according to the latest figures published by the Business Alliance of Slovakia (PAS) the country’s business environment rating has fallen to 49.6 points (less than half its original starting value), in better news the World Economic Forum’s 2017-2018 Global Competitiveness Report (GCR) ranks Slovakia 59th, up six places on last year. Slovakia has alas dropped six places, from 33rd to 39th, in the World Bank’s Ease of Doing Business Report.

Continue reading Slovakia: Growth Continues But Problems Remain

Kraków: Officially Emerging Europe’s Most Elegant City

Krakow. Image of Krakow Market square, Poland during sunrise.

Kraków, Prague, Warsaw, Budapest, Sofia and Tallinn are amongst the world’s most elegant cities in a new survey released by Zalando, a German cross-platform online store that sells fashion items. Kraków and Warsaw ranked 27th and 58th, Prague 39th, Budapest 60th, Sofia 73rd and Tallinn in Estonia 79th in the survey which included 80 cities. Paris, London and Vienna are the survey’s runaway leaders.

Continue reading Kraków: Officially Emerging Europe’s Most Elegant City

Georgia Leads Emerging Europe in Ease of Doing Business Report

Georgia is the easiest place in emerging Europe to do business, according to the latest edition of the World Bank’s Doing Business report, which compares conditions for doing business in 190 countries across the world. Among the top 20, Georgia, with a ranking of 9th, has implemented the highest number of business regulation reforms since the launch of Doing Business in 2003—a total of 47.

Continue reading Georgia Leads Emerging Europe in Ease of Doing Business Report

Economic Confidence Rises Across Eurozone

Despite political tension, eurozone economic confidence rose in October to its highest level in nearly 17 years. The European Commission’s Economic Sentiment Indicator, published on October 30, improved more than expected to 114.0 in October from 113.1 in September. This was the highest since January 2001, when the reading was 144.4. The expected score for October had been 113.3.

Continue reading Economic Confidence Rises Across Eurozone

Sunday Trading in Poland Under Renewed Threat

Poland’s Sunday trading debate continues. In the original draft of new regulations, the Solidarity trade union wanted all shops, with only a few exceptions, to be closed every Sunday. On October 27, however, the Sejm Committee of Social Policy and Family made several amendments to the draft, allowing for trade on the second and fourth Sunday of the month, and the two Sundays before Christmas. The draft law now needs to be discussed further.

Continue reading Sunday Trading in Poland Under Renewed Threat

Czechs Hold Emerging Europe’s Most Powerful Passport

The Czech passport is the most powerful of those issued by the 23 countries of emerging Europe. According to the most recent Passport Index, it is ranked eighth globally and allows its holders to travel visa-free to 152 countries around the world. The Hungarian passport is the second most powerful in the region, the only difference to the Czech equivalent being its failure to offer visa-free travel to Lesotho.

Continue reading Czechs Hold Emerging Europe’s Most Powerful Passport

One in Five Poles Unaware of Source of Funds for 500 Plus Programme

As many as 21 per cent of Poles do not know the main source of funding for the current government’s flagship 500 Plus family benefit programme, and only 38 per cent are aware the funds come from their taxes. The figures were published following research carried out by ciekaweliczby.pl. Even more noteworthy is the fact that as many as 40 per cent of respondents are certain the programme is funded from taxes paid by “other people,” businesses, or the government’s own funds.

Continue reading One in Five Poles Unaware of Source of Funds for 500 Plus Programme

Estonia Leads Baltics in Cutting Sugar in Food and Drink

The Baltic States are waging a war against unhealthy eating and drinking habits, and the Estonian government has been active on a number of fronts. First it raised excise duty on alcohol, and then quickly pushed forward legislation aiming to reduce sugar in food and beverages, duly passed by the Estonian parliament, the Riigikogu, in June 2017. The law introduced taxes on all sweetened drinks containing more than 5 grams of sugar per 100 milliitres.

Continue reading Estonia Leads Baltics in Cutting Sugar in Food and Drink

Romania’s Budget Deficit ‘Should Start Alarm Bells Ringing’

BUCHAREST ROMANIA - June 29 2017: Romanian Prime Minister Mihai Tudose during a swearing-in ceremony at Cotroceni palace in Bucharest capital of Romania June 29 2017.

Romania’s Prime Minister Mihai Tudose said on October 25 that the country’s budget deficit for 2017 was “under 3 per cent” and would “remain under 3 per cent.” His comments came a day after Eurostat published its own figures for the second quarter of 2017, which show that Romania is running by far the biggest budget deficit in the EU, at 4.1 per cent. The UK — whose economy is wracked with uncertainty regarding Brexit — is a distant second, with a deficit of 3.4 per cent. Continue reading Romania’s Budget Deficit ‘Should Start Alarm Bells Ringing’

Lithuania Wants to Bring Home its Skilled Workers

VILNIUS - FEBRUARY 25: Many people choose books at the indoor book

With an unemployment rate of 7.5 per cent in August, Lithuania is facing a shortage of qualified workers. There are over 9,000 vacancies across the country and more than 70 per cent of employees claim finding workers is a challenge. Trying to solve the problem, Invest Lithuania, the country’s investment promotion agency, joined by over 30 foreign companies, has founded Work in Lithuania, a programme inviting emigrants back to the country. Continue reading Lithuania Wants to Bring Home its Skilled Workers

Warsaw Rising: The Polish Capital’s Skyline Gets Even Taller

varso

Warsaw’s skyline, which in recent years has become one of the most impressive in Europe, continues to rise. A number of office buildings, with a combined total leasable area of around 760,000 sq metres, are currently under construction in the city, and almost half of them are skyscrapers. Warsaw’s current highest office building, Ghelamco’s Warsaw Spire will be joined by more skyscrapers: Varso Tower, Karimpol’s Skyliner, Golub Gethouse’s Mennica Legacy Tower or Ghelamco’s two other buildings —  Warsaw Hub and Spinnaker Tower. Continue reading Warsaw Rising: The Polish Capital’s Skyline Gets Even Taller

CEE Boosted by Positive Tourism Trends Across the Region

cruise ship in Kotor Bay Montenegro. Aerial view panorama. Kotor bay Montenegro.

Almost 973 million passengers travelled by air in the European Union in 2016, 5.9 per cent more than in 2015 and 29 per cent more than in 2009. Central and Eastern Europe registered the highest increases, with Bulgarian and Romanian air traffic climbing by 22.5 per cent and 20.5 per cent respectively. The two regional leaders were followed by Hungary (up 14.1 per cent), Croatia (13.8 per cent), and Lithuania (13.3 per cent). According to Eurostat, the total number of people travelling by air from the CEE-EU11 member states exceeded 211 million. Continue reading CEE Boosted by Positive Tourism Trends Across the Region

Romania Cuts Income Tax, Introduces Solidarity Tax

CLUJ NAPOKA ROMANIA - OCT 2 2016: People on the central street of Cluj Napoka - the unofficial capital of Transylvania.

Romania’s Finance Minister Ionuț Mișa announced on October 16 that the rate of income tax would be reduced to 10 per cent from January 1, 2018. The current rate of income tax in the country is 16 per cent. At the same time he also announced the introduction of what has been called a ‘solidarity’ tax of 2 per cent on labour, to be paid by employers. It too will be applied from January 1, 2018. Continue reading Romania Cuts Income Tax, Introduces Solidarity Tax

Despite Public Anxieties, Migration is Playing a Key Role in ECA Growth

Bratislava city aerial panoramic view. Bratislava is the capital of Slovakia.

Economic growth in Europe and Central Asia (ECA) will be 2.2 per cent in 2017, the strongest growth in six years, and 0.3 percentage points above May’s expectations. According to the World Bank’s latest Regional Economic Update, Migration and Mobility in Europe and Central Asia, ECA economies are showing more rapid growth than previously expected with a GDP almost twice the average growth in the European Union. Continue reading Despite Public Anxieties, Migration is Playing a Key Role in ECA Growth

Trans Adriatic Pipeline Will Fuel Albanian Growth

Xanthi. Greece - July 30 2017: aerial view of construction of gas pipeline Trans Adriatic Pipeline - TAP in north Greece. The pipeline starts from the Caspian sea and reaches the coast of southern Italy

The consortium constructing the Trans Adriatic Pipeline (TAP) is investing a total of 800 million euros in Albania in 2017-2018, a sum which represents the largest single input of FDI in the country. (FDI for the whole country is approximately 1.5 billion euros). TAP will additionally create job opportunities for Albanian companies during construction. More than 2,800 people are already working directly for the project. Continue reading Trans Adriatic Pipeline Will Fuel Albanian Growth

High Real Estate Prices at Home Force Czech Investors Abroad

Construction of the Petrin lookout tower in Prague Czech Republic

A lack of commercial property at acceptable prices is forcing some of the largest Czech investment funds to seek better deals abroad. The leading Czech real estate fund ČS Nemovitostní Fond bought an office building in Warsaw for more than 116 million euros early in August 2017, and in September acquired Galeria Słoneczna, a shopping centre in Radom, for 164 million euros. The ČS Nemovitostní Fond, which is the oldest and largest shared fund in the country, has also been buying up property in neighbouring countries in recent months. Continue reading High Real Estate Prices at Home Force Czech Investors Abroad

Estonia Leading CEE Country in WEF Competitiveness Index

pharmaceutical factory woman worker operating production line at pharmacy industry manufacture factory

Switzerland, Singapore and the United States once again occupy the podium places in the World Economic Forum’s (WEF) Global Competitiveness Index. A number of CEE countries rank in the top 50, the highest of which is Estonia (29th), followed by the Czech Republic (31st), Lithuania (35th), Poland (36th) and Azerbaijan (37th). Albania improved its ranking the most, moving up 13 places to 80th. In general, however, all other CEE countries showed clear signs of an economic slowdown. Continue reading Estonia Leading CEE Country in WEF Competitiveness Index

Poland to Switch from Emerging to Developed Market by September 2018

warsaw stock exchange

By September 2018, Poland will no longer be ranked by FTSE Russell as an Emerging Market (FTSE Emerging All Cap), but as a Developed Market (FTSE Developed All Cap Ex-US). This will place the country together with 24 other nations including Germany, France, Japan and Australia. Poland is the first Central and Eastern European economy to be upgraded to Developed Market status. Continue reading Poland to Switch from Emerging to Developed Market by September 2018

UK Economic Growth Slows as Brexit Uncertainty Bites

flags of UK and EU combined over icons of London - Brexit concept

The International Monetary Fund expects the UK economy to grow slower this year and has cut its forecast from 2 per cent to 1.7 per cent. For now, the forecast for 2018 remains unchanged at 1.5 per cent. In the aftermath of last June’s referendum the economy initially proved resilient but in recent months – largely driven by a tumble in the value of the pound – inflation has spiked to almost 3 per cent, squeezing real wages. Continue reading UK Economic Growth Slows as Brexit Uncertainty Bites

Romanian Cabinet Reshuffled as New Splits Emerge in Ruling Party

BUCHAREST ROMANIA - MAY 25 2014: The Victoria Palace. Victoria Square.

Romanian politics has once again been thrust into turmoil by clashes within the ruling Social Democratic Party (PSD). For a party which less than a year ago comfortably won a general election, the PSD is currently looking surprisingly ragged. Opinion polls suggest that the party has lost almost a quarter of its supporters since last December’s election, and the prime minister, Mihai Tudose, is in open conflict with the party’s leader Liviu Dragnea. Mr Tudose is not currently, however, expected to face the same fate as his predecessor Sorin Grindeanu, forced out of office in June after the PSD voted to bring down its own government. Continue reading Romanian Cabinet Reshuffled as New Splits Emerge in Ruling Party

Poles Still Keen on German Jobs

Brandenburg Gate in Berlin in Germany. The Brandenburg Gate is a triumphal arch a city gate in the center of Berlin. It is one of the most known sites in Berlin.

Germany remains the primary destination for Poles looking to work abroad. According to Poland’s Centre for Public Opinion Research (CBOS), in 2016, 41 per cent of Poles working abroad chose the country’s Western neighbour, although there have been years when as many as 48 per cent of Poles abroad worked in Germany. There are two reasons Germany remains favourite: an average monthly salary of 3,700 euros — one of the highest in Europe — and the proximity of the labour market.  Continue reading Poles Still Keen on German Jobs

IMF Increases Growth Forecast With Emerging Europe Prominent

Dambovita river and center of Bucharest at sunset time Romania.

The global economy is speeding up but caution is needed. That was the message from leading economists after the International Monetary Fund (IMF) increased its growth forecasts, with global output growth no expected to increase from 3.2 per cent in 2016 to 3.6 per cent this year, and 3.7 per cent in 2018. But the global economy’s recent recovery may not last, despite a pickup in activity in all western countries except the UK. High asset prices, rapid credit growth in China, political turmoil in Catalonia and a cliff-edge Brexit are the primary risks. Continue reading IMF Increases Growth Forecast With Emerging Europe Prominent

Bad Payers Still Causing Problems for Romanian Firms

Close up Romanian currency note, LEI or LEU, Romania

More than a quarter of all invoices issued in Romania are paid late or not at all, a new report suggests. The study into European payment patterns, carried out by TNS for debt recovery specialist EOS, shows that 23 per cent of invoices are paid late, while 4 per cent are never paid at all. The rate is slightly above the average for the region (25 per cent). The best performers in Emerging Europe are Poland and the Czech Republic, where 80 per cent of payments are made on time. Continue reading Bad Payers Still Causing Problems for Romanian Firms

CEE Is Key to China’s Belt and Road Initiative

Shanghai skyline Panoramic view of shanghai skyline and huangpu river Shanghai China

With deep government pockets, technical sophistication and a comprehensive investment plan behind it, China’s Belt and Road Initiative (BRI) can have a big impact on the transformation of the Western Balkans. There are caveats, not least debt dependency on cheap Chinese loans, but a proactive approach throughout the region could bring welcome development for many in countries that are not prime investment destinations. Continue reading CEE Is Key to China’s Belt and Road Initiative

Lithuania Handed Top Marks for Business Services

Beautiful panorama of Vilnius Old Town taken from Gediminas hill; Lithuania

Innovation and excellence across all its operations: this is the definition given to the Lithuanian Global Business Services (GBS) sector by the latest Invest Lithuania report. Over the past eight years, the Baltic country has strengthened its position as a go-to destination for business services in Northern and Central Eastern Europe, with 41 business centres located in Vilnius alone, while several other towns throughout the country, including Kaunas and Klaipeda, are also growing in importance. Continue reading Lithuania Handed Top Marks for Business Services

Global Players Dash for Tempting CEE

dollar pound euro coin on euro background.

News is spreading. Long viewed by Western European and American financial institutions as a safe place to do business, private and public investment funds from parts as distant as Asia and Africa now view Central and Eastern Europe as more attractive than some western economies. That’s the headline finding of a new report jointly published by Skanska, JLL and Dentons. In the first half of 2017, investors spent approximately 5.6 billion euros across the region, 10 per cent more than the first half of 2016. Continue reading Global Players Dash for Tempting CEE

Lithuania Set to Streamline Competition Legislation

Industrial dock with cranes on the quay

Lithuania’s Economy Ministry plans to make mergers and acquisitions easier from 2018. Draft amendments to the competition law will see the level of turnover before any merger needs to be referred to the regulator (Lithuania’s Competition Council; LKT) increase from 1.45 million to 2 million euros. In instances where several companies are being consolidated into one, the Economy Ministry is proposing the limit be raised from 14.5 million to 20 million euros. Continue reading Lithuania Set to Streamline Competition Legislation

More Brexit Fears As the UK Proves To Be A Needed Member

City of London view from Waterloo Bridge. This view includes: St. Paul`s Cathedral The Gherkin Tower 42 and Blackfriars Bridge.

Uncertainty about the process and outcome of Brexit negotiations, coupled with a potentially short timeframe for change, is already impacting investment and commercial decisions. But this is not the only finding of the report ‘Brexit — the Voices of European Business,’ which was carried out by the Council of British Chambers of Commerce in Europe (COBCOE). Continue reading More Brexit Fears As the UK Proves To Be A Needed Member

Automotive and Transport Companies Dominate the CEE Region

Car bodies on the production line inside automobile factory

In 2016, 500 of the largest companies in Central and Eastern Europe generated a turnover of 580 billion euros, says the Coface CEE Top 500 report. Polish companies increased their turnover by 3.3 per cent, while the turnover in Hungarian and Czech firms decreased by 11.5 and 2.2 per cent respectively. With two companies located in Poland— Orlen and Jeronimo Martins, and one each in the Czech Republic, Hungary and Slovakia (Škoda,  MOL and Volkswagen, respectively), the top five lacks a Romanian business. However, this might change in the coming years. Continue reading Automotive and Transport Companies Dominate the CEE Region

Jadranka Joksimović: Serbia Takes Its Candidacy of the EU Seriously

bigstock-Joint-Press-Conference-Of-Serb-155400338.jpg

Jadranka Joksimović, Serbian minister of European integration, believes that Serbia’s strategic role is in connecting — connecting economies, people, even policies. She spoke to Nikodem Chinowski about the EU integration process, difficult neighbour relations with Croatia and Kosovo, and about the idea of the Balkan single market. Continue reading Jadranka Joksimović: Serbia Takes Its Candidacy of the EU Seriously

Lithuania Gives Innovation a StartUp

MILAN ITALY - MAY 2: People visit Lithuania pavilion at Expo universal exposition on the theme of food on MAY 2 2015 in Milan.

The first non-EU entrepreneurs have completed the application process and are about to establish their businesses in Lithuania, within the government’s Startup Visa programme. The Startup Visa legislation, which was approved in 2016 and is now fully operational, makes it easier for non-EU nationals to get a temporary residence permit, provided they operate in an innovative field and have enough financial resources to achieve their goals for one year. Continue reading Lithuania Gives Innovation a StartUp

Estcoin: Estonia’s Own Digital Currency?

1 euro coin money (EUR) currency of European Union Estonia over blue background

Estonia might be the first country in the world to offer its own token through an Initial Coin Offering (ICO). ‘Estcoins’ would be managed by the Republic of Estonia, but accessed by anyone in the world through its e-Residency programme. They would be launched through an Initial Coin Offering (ICO), which would enable companies to crowdfund their finance and incentivise a wide range of people to help grow their businesses.
Continue reading Estcoin: Estonia’s Own Digital Currency?

Putin Urges Belarus to End Oil Transit Through Lithuania

Athens Greece - May 27 2016: Russian President Vladimir Putin delivers

Instead of using the Lithuanian ports, Belarus should use Russia’s Baltic ports in the Gulf of Finland, Saint Petersburg and Ust Luga, to transport its oil products made from Russian crude oil, said Russian president, Vladimir Putin during his recent visit to Russia’s Baltic Sea exclave of Kaliningrad, sandwiched between Poland and Lithuania. Continue reading Putin Urges Belarus to End Oil Transit Through Lithuania

Polish Labour Market Deficits Are Impacting All

Construction site with crane and building. Construction site in western europe - in Poland.

Half of Polish employers say they already face recruitment challenges which impact their companies’ development, says the latest Work Service report ‘Labour Market Barometer VIII.’ A third of them are struggling with personnel deficiencies, which prevents them from completing new contracts. Every eighth business has been forced to retreat from planned investments because of a shortage of candidates. Continue reading Polish Labour Market Deficits Are Impacting All

21st century Manufacturing Arrives at Great Stone

Great stone

RuchTech, an American fibre laser manufacturer and a subsidiary of IPG Photonics Corporation, has set up in the Great Stone Industrial Park located on the outskirts of Belarus’ capital city of Minsk. Within the next two years the investor is planning on constructing a plant that will produce various types of laser equipment, both for industrial and medical purposes. Continue reading 21st century Manufacturing Arrives at Great Stone

Meghri Becomes Armenia’s Third FEZ

armenia emerging europe

The government of Armenia has set up the Meghri Free Economic Zone, close to its border with the Islamic Republic of Iran. The project, managed by the Ministry of Economic Development and Investments, aims to increase export-oriented production in Armenia and to attract more investors. This will be thanks to a preferential trade regime with the European Union and its being a member of the Eurasian Economic Union (EEU) on one hand, and a common border with Iran, on the other. Continue reading Meghri Becomes Armenia’s Third FEZ

Croatian Salaries Are Growing in Line With Other CEE Countries

Dubrovnik Croatia emerging europe

Salaries in Slovenia and Croatia are growing faster than in the five other countries that made up former Yugoslavia. According to the Croatian Bureau of Statistics, Slovenia pays the highest salary in the region at €1,050.78, immediately followed by Croatia where the average monthly salary amounts to €813.1, which is an increase of €63,47 compared to 2016. At the bottom we find the Republic of Macedonia with only €372,55. Continue reading Croatian Salaries Are Growing in Line With Other CEE Countries

Prospering Czechia Still Needs a Bigger Workforce

prague emerging europe

Czechia has the lowest unemployment in the European Union, at 2.9 per cent, says the recent Eurostat report. The country is followed by Germany (3.8 per cent) and Malta (4.1 per cent). Even though there are countries with lower labour costs, Czechia’s costs are still significantly lower than in Western Europe; the average hourly wage cost in the country is only €10.20 compared to €24.40. So, what else makes Czechia an attractive business destination? Continue reading Prospering Czechia Still Needs a Bigger Workforce

Nadiya Savchenko: I Dream of a Great Ukraine

Panorama of the top part of the Andrew's Descent from Castle Hill in springtime in Kiev Ukraine.

When the war in the Donbass started, she joined the battalion that fought to retain the territory for the country. She was arrested by Russian separatists in June 2014, and, after one month, taken away to Russia. Nadiya Savchenko is one of the most recognised Ukrainians; a pilot-navigator, a deputy of the Supreme Council of Ukraine and, first of all, a symbol of the fight for the freedom and independence of Ukraine. She talked to Krzysztof Tadej about what kept her alive during the 706 days she spent in a Russian prison. Continue reading Nadiya Savchenko: I Dream of a Great Ukraine

Derek Chollet: There Is a Resurgence of Supporters of the Transatlantic Relationship

white house

After eight years of a coherent US foreign policy on Europe, under the Obama administration, the Old Continent now finds itself with the polar opposite in the White House. Will the remnants of Obama’s policy outlive the Trump era?

Derek Chollet is former US Assistant Secretary of Defence for International Security Affairs, vice president and senior advisor for security and defence policy at the German Marshall Fund of the United States. He spoke to Santiago de la Presilla about the future of the transatlantic relationship. Continue reading Derek Chollet: There Is a Resurgence of Supporters of the Transatlantic Relationship

Changes Are Making Ukrainian Banking More Aligned with International Standards

In January 2014, €1 cost about 11 Hryvnias (UAH) and $1, almost eight. At the end of December 2016, these foreign currencies were bought at close to 28 and 27 Hryvnias, respectively. However, depreciation is not the only challenge the National Bank of Ukraine has had to face.

Dmytro Sologub, Deputy Governor of the National Bank of Ukraine (NBU), spoke to Andrew Wrobel about the recent nationalisation of PrivatBank, the country’s largest bank, about the reforms of the banking system and development prospects for the financial sector, as well as the future of FDI in Ukraine. Continue reading Changes Are Making Ukrainian Banking More Aligned with International Standards

Larisa Manastirli: Where is Bulgaria After Ten Years in the EU?

In November 2016, Bulgarian opposition Socialist, Rumen Radev, won the presidential election, defeating the centre-right speaker of parliament, Tsetska Tsacheva, an ally of Prime Minister, Boyko Borissov. The PM had pledged to step down if his candidate lost, and he did thus triggering an early election.

Larisa Manastirli, Director for Bulgaria at the European Bank for Reconstruction and Development (EBRD), which is a leading investor in the Bulgarian economy, spoke to Andrew Wrobel, about the reforms the country has introduced and the improvements that are still required, ten years after Bulgaria joined the European Union. Continue reading Larisa Manastirli: Where is Bulgaria After Ten Years in the EU?

Western Ukraine Could Be an Entry Point into the Country

When Ukraine makes the headlines, it is generally because of the war, which started in 2014, in the eastern part. This has hugely influenced the political and economic situation of the country, including the ease of doing business. However, it’s unjustified to think that, given the circumstances, investing in the whole country makes no sense.  Continue reading Western Ukraine Could Be an Entry Point into the Country

Lviv Is the Pearl and the Soul of Ukraine

Lviv is the important cultural, economic and scientific centre of western Ukraine. Its architectural charm and cultural heritage have earned the city the nickname, Pearl of Ukraine. It is also a modern city that is looking towards a bright future thanks to the development of the IT sector.

Andriy Sadovyi, Mayor of Lviv, spoke to Andrew Wrobel about his city’s key sectors, his future vision for the city and the amazing ambiance that makes Lviv a must-see on the European tourist map. Continue reading Lviv Is the Pearl and the Soul of Ukraine

Lech Wałęsa: Hard Options Can Force Nations to Get Down to Work

Over the last quarter of a century, the region of Central and Eastern Europe has undergone a huge transformation in all possible fields with a special emphasis on the economy, politics and social affairs. The transformation is not yet complete, so the shape of the CEE countries is still changing rapidly.

Lech Wałęsa, the first freely-elected president of Poland, the co-founder of the Solidarity Movement and a Nobel Peace Prize winner in 1983, talked to Nikodem Chinowski about economic and social transformations in the CEE, the future of the Visegrad Group and NATO and about his concept of introducing the globo-dollar as a worldwide currency.

Continue reading Lech Wałęsa: Hard Options Can Force Nations to Get Down to Work

Do Your Homework First and Starting Business in Poland is Easier

New VAT forms that companies submit to the tax office and an updated list of products and services with a lower VAT rate are only a few of the procedures that have resulted from the Ministry of Finance’s five recent decrees. In July 2016, the Parliament approved new amendments to the VAT law in order to reduce informal economy. The Ministry of Justice plans on fighting the informal sector even further with terms of imprisonment for up to 25 years for tax fraud. Provisions against tax evasion have recently been introduced.   Continue reading Do Your Homework First and Starting Business in Poland is Easier

Ukraine Is Offering Europe Unique Combat and Technological Experience

Since it obtained full sovereignty from the Soviet Union, in 1991, Ukraine has remained suspended somewhere between the East and the West, being pulled closer to one or the other by various administrations. Now, paradoxically, an important stimulus for defining the future identity of this country of over 40 million has come, with the Russian occupation of the eastern part of Ukraine in 2014.

Ivanna Klympush-Tsintsadze, Ukrainian Deputy Prime Minister for European and Euro-Atlantic Integration, spoke to Nikodem Chinowski about the prospects for integration with NATO and the European Union and about the development of the Ukrainian economy, a few days ahead of the 25th anniversary of the country’s independence. Continue reading Ukraine Is Offering Europe Unique Combat and Technological Experience

The Reality in Romania Exposes False Perceptions Of The Country

In 2015, foreign companies invested almost $3.4 billion in Romania, which is also the average FDI that the country has attracted in the last four years, according to the World Investment Report 2016. In 2016, Romania is expected to be the EU’s fastest growing economy. Will that growth help the country increase FDI into the country?

Manuel Costescu, Secretary of State at the Ministry of Economy of Romania, is responsible for foreign direct investment as the Head of InvestRomania. He talked to Andrew Wrobel about the country’s new investment promotion strategy, Romania’s key sectors and the successes the country has achieved in fighting corruption and improving its business climate. Continue reading The Reality in Romania Exposes False Perceptions Of The Country

World Bank: Brexit Hides Greater Challenges to the European Union and the CEE Region

Today, people across the United Kingdom are casting a vote that could change their country, but which could also transform European politics. The Remain camp claims that leaving the EU will be detrimental to Britain’s economy. Their opponents say the detriment to the UK of staying in the EU far outweighs the risks of leaving. They believe the Eurozone has been a disaster and maintain that it’s very important for Britain to regain control of their own borders.

Dr Arup Banerji, Regional Director for the European Union countries for the World Bank Group, talked to Andrew Wrobel about the impact of Brexit on Central and Eastern Europe. They also discussed other challenges that the European Union is currently facing that concern the CEE region and the solutions that might help address these. Continue reading World Bank: Brexit Hides Greater Challenges to the European Union and the CEE Region

SEE Link — Sharing SEE Europe’s Hopes for a Brighter Investment Future

SEE Link was officially launched at the end of March 2016, and is growing rapidly in terms of its member exchanges. The shared platform, which was originally set up by the stock exchanges in Zagreb, Sofia and Skopje, aims to rationalise and connect the relatively small capital markets of south-eastern Europe. It now has four new members that applied and will be connected to the platform this year: Ljubljana, Belgrade, Montenegro and Banja Luka. In addition the Athens Stock Exchange has recently submitted membership application and Bucharest intends to do so later this year.

Continue reading SEE Link — Sharing SEE Europe’s Hopes for a Brighter Investment Future

Chris Lowney — What Jesuit Spirituality Can Teach Us About Global Leadership

In 1983, Chris Lowney left the Jesuit seminary he had been studying with from the age of 18 to work as an investment banker and then managing director for J.P. Morgan. Since leaving the bank in 2001 he has written four books and has been involved in a number of philanthropic efforts, including chairing the board of Catholic Health Initiatives, America’s second largest not-for-profit hospital and healthcare system.  Continue reading Chris Lowney — What Jesuit Spirituality Can Teach Us About Global Leadership

Mayor: Armenia And Its Capital Yerevan Offer Safe Investment And Tourism To a Growing World

In 2015, 1.19 million foreign tourists visited Armenia. That is one per cent fewer than in 2014, as the country attracted fewer visitors from Russia, but almost ten per cent more than in 2013. The country is also one of the ten safest destinations in the world, according to the Global Terrorism Index 2015. International airlines such as Air France and LOT fly to Yerevan regularly and Qatar Airways will begin flights in mid-May, 2016. Continue reading Mayor: Armenia And Its Capital Yerevan Offer Safe Investment And Tourism To a Growing World

EconMin: Bulgaria — Number One Outsourcing Destination And an Island of Stability in Europe

In 2015, Bulgaria was named the best outsourcing destination by the UK’s National Outsourcing Association (NOA), and the BPO sector’s contribution to the country’s economy amounts to 3 per cent. In addition to this, the Bulgarian government is aiming to improve the country’s business climate by offering a range of incentives for foreign investors as well as individuals.  The country currently has the lowest rate of personal income tax in the European Union and it offers fiscal citizenship to foreign nationals, working in Bulgaria. Continue reading EconMin: Bulgaria — Number One Outsourcing Destination And an Island of Stability in Europe

Non-Financial Reporting No Longer a Secondary Consideration in CEE

The number of non-financial reports is growing and according to the Global Reporting Initiative (GRI), around 5,000 sustainability reports enter the global market, annually with 40 per cent out of those coming from Europe. A group of strong leaders, in non-financial reporting, has already been established in Central and Eastern Europe. The Deloitte CE Top 500 ranks the largest companies from CEE countries and 109 of them already have some form of non-financial reporting in place or at least will report non-financial data for 2015.

Continue reading Non-Financial Reporting No Longer a Secondary Consideration in CEE

Economy Minister: Internationalisation Is the Key To the Slovenian Economy

According to the European Commission, the Slovenian economy grew by 3.0 and 2.5 per cent in 2014 and 2015 respectively. Slovenia also has 83 per cent of the EU average GDP per capita, making them, together with the Czechs, one of the most affluent nations in emerging Europe.

Emerging Europe spoke to Zdravko Počivalšek, Minister of Economic Development and Technology of the Republic of Slovenia, about the country’s plans for further growth, privatisation and their approach to foreign investors. Continue reading Economy Minister: Internationalisation Is the Key To the Slovenian Economy

World Bank’s Doing Business Report 2016 Resume For Emerging Europe

Almost every single economy in emerging Europe implemented at least one reform in the last year to improve their business environment. In consequence, as many as 16 economies in the region are featured in the Top 50 of the World Bank’s Doing Business 2016 report. Emerging Europe speaks to Rita Ramalho, Manager of the World Bank–IFC Doing Business, who has compiled a resume about the emerging Europe region especially for us, about how the reforms introduced have helped make doing business easier across the region. Continue reading World Bank’s Doing Business Report 2016 Resume For Emerging Europe