Development and Finance from issue 2009/1

Stergios Babanasis

Foreign Investment in the Balkans. The Greek Experience

- Abstract -

JEL F-21

In the period after the turn of the millennium the dynamic development of foreign direct investment not only stimulated Greek exports and economic growth but the results of this investment activity greatly contributed to transforming the Balkans from a European "powder keg" into a zone of stability and cooperation where almost every country has joined the EU or is on the threshold of accession. There are several pre-requisites to realising foreign investments. The first criterion is exploring investment demands and opportunities. Close attention must be paid to tenders connected with investments in the Balkan states; their legal and economic terms and conditions must be scrutinised together with changes in the political, economic and business environment.  The second criterion is the provision of capital and other resources required to finance investments.  This requires financially strong companies and favourable credit resources. The third criterion is elaborating technical and economic feasibility studies in connection with the foreign investment (cost/benefit, input/output calculations, calculations of return, market research, marketing, etc.). The fourth and possibly most significant criterion is that the aforementioned cultural and other characteristics of Balkan states and markets must be understood and taken into consideration.

Stergios Babanasis, Professor Emeritus, DSc (Hungarian Academy of Sciences), President of the Mediterranean Research Institute

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