New Trends in Foreign Direct Investment Flows in Hungary
Keywords:
FDI, Foreign Direct InvestmentAbstract
FDI flows to Hungary have slowed down in recent years, while FDI outflows have grown significantly. A change in capital flow
trends is influenced by the termination of the privatisation process in Hungary. It is still open to interpretations whether the
deterioration of the net FDI balance is also due to loss of international competitiveness of the country. Based on surveys on strategic
decisions of major corporations, the study concludes that in the period of 2000 to 2003 mostly firm and region specific factors shaped
the capital outflows. However, a further deterioration of FDI balance would be detrimental to the development of the Hungarian
economy. Sources and sector targets of further FDI inflows in the period directly before and after the accession to the EU are expected
to differ significantly from those in the 1990s.
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