Foreign direct investment into eastern Europe hit a record US$112bn in 2006, putting the region ahead of Latin America and second only to Asia among emerging markets. Privatisation was again a prominent driver, and its near-exhaustion points to a weaker FDI performance in 2007 and beyond, for eastern Europe is failing to rise to Asia’s competitive challenge. Moreover, there is little evidence yet that EU enlargement is sparking a massive relocation of production within Europe, from West to East.
According to final official data reported by the region's central banks or statistical authorities (supplemented in a few cases by Economist Intelligence Unit or IMF estimates), FDI inflows into the transition economies reached a record total of US$112bn in 2006, up by 45% on the US$77bn received in 2005.
