Foreign direct investment (FDI) inflows into the transition economies of eastern Europe this year are expected to be similar to, or even exceed, the record total of US$34 billion achieved in 2002, according to a study by the Economist Intelligence Unit (EIU). However, despite EU enlargement in 2004, the main traditional FDI destinations in eastern Europe, such as Hungary, are expected to attract a declining share of regional FDI.
In Hungary, inward FDI was actually negative in the first half of 2003, as disinvestment by existing companies exceeded new investments, the report points out, adding that Hungary has been hurt by strong wage growth and the real appreciation of the forint in 2001-2002, as well as generally weakening performance.
