Eastern Europe Still Lagging as Business Location

A recent article in Expansion Management Magazine talks about how US companies still prefer Western Europe over Eastern Europe for business operating locations. I think this is true--for now. The question is what happens in the next 5 years as cost pressures push more US companies out of Western Europe? Another important point should be made here. It is Western European companies--not US companies--that are leading the investment drive in Eastern Europe.

A larger question to consider is this: How well will Eastern European fare in competition with even lower cost locations in India and China in the next 5 years? Much of the investment in Eastern Europe that I see has a larger European market orientation to it. It makes sense to manufacture goods in the Czech Republic if you want to sell them across the European continent.

US economic developers should have Eastern Europe on their radar screens for a variety of reasons. Not the least of which is that some of the Western European companies they seek to attract to the US will seek and find homes in Eastern Europe.

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