Eastern Europe
The phenomenal growth rate of Eastern Europe since the fall of the “Iron Curtain” has attracted the attention of investors, academics and the global community, at large.
Reforms in political governance, substitution of free market policies for “state forces” and promotion of rule law are often cited as the reasons for growth in this formerly deprived region of Europe. The unprecedented inflow of inbound investments has transformed the region into a net exporter of semi-finished and finished manufactured goods. Between 1990 and 2011, the size of the economy more than doubled while standard of living markedly improved. In less than twenty years, the region has moved from low income to high income status. For most investors and academics, the prospect for future economic growth is high. The weak global economy and lingering debt crisis in Euro area presents a formidable obstacle to continued growth in the short-to medium term. With the end of economic turmoil in sight, and efforts to diversify export produce, most analysts are upbeat about growth in the long term.
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Asia-Pacific
The Asia-Pacific region remains a premier destination for global investments. Even at the height of the global economic downturn, foreign investors committed nearly $40 billion to the region.
The growth in Asia-Pacific has been driven mainly by forward-looking reforms and rapid industrialization policies implemented by national governments over the last 20 years. Although individual countries differ in their unique experiences and starting points, Asia-Pacific is positioned to be a key driver of global economic growth. The region, though, is a mix bag of opportunities and challenges. On the whole, ASEAN countries present significant investment opportunities in the short and medium-term, but natural disasters, excessive liquidity, weak regulatory environment, the lack of transparency in corporate governance, and unbridled trade regime exposes the region to severe risk of contagious insolvency.
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MENA
The MENA region has performed well in GDP terms over the past decade. Among comparable regions, the MENA region has the highest GDP growth rate over the past five years.
Despite this occurrence, there is the absence of a vibrant private sector. Moreover, the MENA region is not well connected with global investment and production chains. This is due to limited role played by foreign direct investment in the region’s economies. For instance, in the year 2000, the MENA region excluding the Gulf countries received net inflows of foreign direct investment (FDI) of about $2.2 billion, which was nine times less than that ($19 billion) received together by the group of five Eastern European countries (Czech Republic, Hungary, Poland, Turkey and Russia).
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