Central & Eastern Europe - Better than Asia

• Close geographical and cultural proximity to Western markets
• Multilingual, skilled, available and low cost labor force (1/4 the cost of Western Europe)
• Room for growth within market

European Economic Map 2008/2009

Click the thumbnail below to access our economic map of Europe - includes the most important economic performance indicators of all European Union member states plotted onto a

Central and Eastern Europe (CEE) has been fueling global economic growth and counterbalancing Western economies’ slowdowns in the last decade. Many people from the West still picture these countries as poor and underdeveloped. When they come to see them first-hand, they are astonished. Prague, Budapest, Bratislava, and Warsaw, with their picturesque old-towns, newly developed commercial and financial districts, and clean and well maintained facilities can cause western newcomers to think that communism never existed there. McDonalds, Burger King, or Starbucks can feature their clean and well maintained franchise shops in the CEE cities as showcases to sometimes poorly maintained operations in New York City, London or Milan.

Rapid growth, significantly cheaper, abundant, and highly skilled labor, and close physical and cultural proximity to the Western markets are pushing Western Europe to turn more frequently to its own backyard. “American companies are cashing in as well. In recent years, IBM, Dell and Morgan Stanley, among others, have outsourced services to Eastern Europe, or helped other American companies do so.”

Given the substantial cost benefits, Asia is the only comparable competitor for locating an operation elsewhere. Though the wider cultural differences, greater geographical distance and “Made in China” vs. “Made in the EU” may not prove beneficial for companies that want to grow quickly and serve customers seeking top quality products and services.

The Western markets are facing difficulties growing their businesses locally. Ironically, countries like the U.K., once afraid of CEE immigrants flooding in, recorded an all time low in new applications for work permits (45,000) in the first quarter of 2008 from the nationals of the eight newly joined EU countries - down 13% from the same period in the previous year. Applications from Bulgarians and Romanians fell even more drastically – by 21% to 8,205.

Clearly, companies that want to grow in Europe and sustain their competitive edge will have to turn to CEE.. The critical questions remain: (1) To which location, (2) When, and (3) How?