Analysis of business environment using the multi-criteria approach: Case of Balkan's transition economies

Culinary is a service provider for everyone's basic needs and along with the times, culinary has also become a business trend in society. The purpose of this research is to find out (1) analysis of the business environment and entrepreneurial strategies in improving SME culinary businesses, (2) the best alternative strategies in improving SME culinary businesses. The research method used is descriptive qualitative. The data analysis used is descriptive qualitative in describing the business environment in UKM Salenrang. The results of the analysis of the internal business environment in UKM Salenrang are: (a) HR aspects, (b) financial/accounting aspects, (c) production/operations aspects, and (d) marketing aspects, while the analysis of the external business environment is: (a) strengths economic, (b) technological power, (c) social power, and (d) political power. The results of the entrepreneurial strategy analysis using SWOT analysis by identifying the internal factors of Salenrang SMEs, namely strengths: quality raw materials, affordable product prices, comfortable and strategic shopping places, varied product types and tastes, service, complete public facilities, application discounts, and a neat and clean room design. Meanwhile, weaknesses include a business management system that is not yet optimal, marketing promotions that are not yet intensive and packaging for some products that is less attractive. Identify external factors, namely opportunities, including government policies that support the development of SMEs in Maros Regency, while the threats faced are competitors that have emerged. This condition puts Salenrang SMEs in a growth position.

It is widely known and well documented in practice that foreign direct investment already two decades dominating on the global level as a promoter of economic growth and development, particularly in developing countries and countries in transition. However, the use of foreign direct investment in a manner that contributes to the long-term development goals, is the main task and the main challenge facing policy-makers in countries in transition. Practice has proved that, in order to attracting larger flows and fully absorbing the benefits of foreign direct investment, governments in the economies in transition should not only follow the 'open door' policy for foreign direct investment, but also to more liberal regime for foreign direct investment used in combination with other measures of policy support. Serbian authorities during the last ten years achieved remarkable results in terms of creating a favorable environment for attracting foreign direct investment. However, in the previous transition period, it is achieved a relatively low level of FDI inflow, followed by relatively minor modification to the model entry, points to the urgent need to undertake measures aimed at improving the quality of the environment. The aim of this paper is to highlight the importance and role of government in stimulating the inflow and creating the conditions for maximum use of the positive developmental effects of foreign direct investment, and based on comprehensive analysis of investment environment in Serbia points to the possible directions for its improvement.

We evaluate the impact of the crisis on foreign direct investment (FDI) and differences between selected transition and Western economies regarding their policies and attitudes towards FDI. Transition economies have been affected by the crisis more than Western countries, but remain more optimistic about the current and future role of FDI's influence on competitiveness, and also see FDI as a relatively more important instrument for enhancing competitiveness than their Western counterparts. In addition, the investment promotion agencies seemingly have a completely different set of excelling factors in transition economies in comparison to their Western counterparts. Transition and Western countries differ in terms of their need, environments and attitudes when it comes to FDI. Thus, one of the crisis-related implications is the need to tailor the FDI policy and promotion approach to each group's specific needs.

The article explores the determination of foreign direct investment (FDI) into the Balkan transition economies – Albania, Bosnia and Herzegovina, Bulgaria, Croatia, Macedonia, Montenegro, Romania and Serbia. Detailed FDI inflows to Southeast Europe are analysed to determine the main differences in the volume, timing and sectoral structure of FDI within the region and in comparison to the Central East European countries. A gravity model for all transition economies during 1990–2011 is then estimated to assess whether the factors driving FDI to the Western Balkans are different. They are found to be so; even when the size of their economies, distance from the source economies, institutional quality and prospects of EU membership are taken into account, Western Balkans countries receive less FDI than other transition countries. These issues are of policy relevance for the Balkan economies and ought to contribute to the current debate on the ‘new growth model’.

Foreign Direct Investments (FDI) has been considered an important source of economic growth and technological development in transition economies. The previous empirical literature has shown that FDI promote economic growth via complementary effects on domestic investments, increases in productivity and overall economic efficiency, giving rise to an increasing interest in understanding the key determinants of FDI. Apart from traditional FDI determinants, favourable tax policy has been considered an important factor influencing MNCs’ location decisions. The goal of this paper is to investigate the impact of corporate income tax on FDI in the context of less advanced transition economies and to analyse whether the tax effect is conditional on the level of economic development. A small number of studies exist analysing the importance of tax policy regime in attracting FDI covering South-East European countries. In this study, we rely on panel gravity econometric framework and examine the impact of tax policy on FDI using bilateral FDI flows between 8 home and 8 South East Europe host countries in the period 2000–2018. We estimate the regression using Prais-Winsten correlated panels corrected standard errors PSCE method to obtain robust estimates of individual effects in the presence of heteroscedasticity and serial correlation. The seven SEE host countries included in the sample are considered of similar economic structures and institutional transformation, which seems important in analysing tax policy effectiveness and minimising biases associated with econometric modelling of FDI determinants. Finally, we study this relationship in an integrated framework considering traditional gravity forces as well as a number of additional FDI determinants, including institutional factors. We show that, although tax policy seems an important determinant of FDI, its effects seem to be conditional on the level of technological development. Given these findings, reducing corporate income tax may be considered an effective tool in promoting FDI, which seems to be of particular importance for less developed transition economies. The results are robust to different model specifications and consideration of endogeneity.Implications for Central European audience: The direct implications of this research for business policymakers in CEE include the need to revise and optimise the levels of corporate income tax and incorporate this specific policy instrument in FDI strategies. In particular, the results of this research indicate that tax cuts have been more effective in attracting FDI in countries that are at a lower level of technological sophistication. The managers could seek to size the investment opportunity related to possible further corporate income tax cuts in the group of least developed CEE amid the economic rationale for tax policy competition among these countries.

Globalization and its impact on developing and transition economies are among most debated issues in social sciences. Globalization is multidimensional, multipart and multispeed phenomena affecting all countries and nations in the world. However, economic dimension of globalization could be considered as foundation as well as determinant of development of other forms of globalization, including political and social globalization. It is obvious, that economic globalization intensifies cooperation as well as competition on regional and global level and therefore, enhances economic and political interdependence among countries. There are many conflicting approaches towards globalization. However, a leading form of globalization still is neoliberal globalization, while other perspectives are opposing ideas to neoliberal globalization. A fundamental idea of neoliberal economic globalization is socalled “small government” and openness for trade and investment, which has been considered as a necessary precondition for economic development of any nation in the world since 1980s. Noteworthy, that major negative aspects of neoliberal globalization, underlined by “skeptics” are negative effects of neoliberal globalization on trade and investment performance of developing and transition economies. Conducted analysis of trade and investment performance of developing and transition economies demonstrates their growing involvement in globalizing world economy. Ac- cording to data of the United Nations Conference on Trade and Development (UNCTAD), during 1990-2018, exports an- nual average growth rates of developing and transition countries were 9,5% and 8,8% respectively, while exports annual average growth rate of developed countries was 5,7%. More - over, in 1990-2018, imports annual average growth rates of developing and transition countries were 9,3% and 7,7% respectively, while imports average growth rate of developed countries was 5, 9%. It is clear, that besides trade, Foreign Direct Investment is the major indicator to evaluate countries/ country groups’ involvement in globalization. Noteworthy, that between 1990 and 2000 average share of developing countries in world Foreign Direct Investments (inward) was 29,3%, in 2001-2010 was 34, 4%, while in 2011-2018 aver- age share was 44, 2%. In 2018, developing countries share in inward world Foreign Direct Investments was 54, 4%, while developed countries share was 42, 9%. It is clear, that countries/country groups’ involvement in the international capital movement and in globalization processes in general, depends not only on inward Foreign Direct Investments, but also on outward FDIs. In 1990-2000, average share of developing countries in outward FDIs was 10,4%, in 2001-2010 was 14,1%, while in 2011-2018 average share of developing countries in outward world FDIs significantly increased and reached 30,1%. The data underlines an intensification of trade relations of transition and developing countries as well as their increased openness for Foreign Direct Investments and rising share in outward world FDIs. As a result, during 1990-2018, developing and transition countries involvement in globalizing world economy significantly increased via increased trade relations and growing participation in movement of Foreign Direct Invest- ments. Consequently, despite some setbacks, economic globalization remains as the leading characteristic of the world economic development and process of deglobalization is not evident.

Foreign direct investment (FDI) brings host countries capital, productive facilities, and technology transfer, as well as new jobs and management expertise. Thus, it is important to understand why in many transition countries FDI inflow is lower than expected. The goal of this study is to explore some important factors determining flow of FDI into transition countries. In particular, we analyze the legal environment for FDI in some transition economies. Then we model the impact of stability of the economic and legal environment on the pattern of FDI. Our analysis shows that (1) higher variability of basic macroeconomic fundamentals reduces the flow of FDI, (2) high volatility of fiscal and business regulations makes the inflow of FDI smaller, and (3) macroeconomic and legal instability leads to adverse selection of the investors. Based on theoretical findings we formulate a clear message to policy makers stating that in order to attract significant inflows of long-term and nonspeculative foreign capital, first of all, a stable economic and institutional environment is needed.

The Balkan transition countries have been much less successful in attracting foreign direct investment (FDI) than have the Central European transition countries. Political instability, low intra-regional trade and the small size of national markets are only some of the causes of this FDI gap. Among the more successful Balkan recipients of FDI has been Bulgaria, while Greece has been a major source of FDI for the transition economies of the Balkan region. Greek investment is driven in part by the availability of low cost labor in the nearby transition economies. The article closes by reviewing the policies and FDI patterns of the Balkan transition countries.

One of the most important conditions for succesful prosess of economy restructuring and efficient return into the global market framework of transition countries from Central and Eastern Europe, including Balkans region, is opening of these economies towards foreign investors. Export orientation of multinational companies has a significant impact on transition economies, especially from the Balkans, which are still fragile and exposed to different pressures. European integration processes also had the great effect, especially on the changes in the foreign trade exchange of transition economies and countries which were able to strengthen the exports sector and provide high level of exports, have gone through the process of transition more quickly and easily. The research presented in this paper is focused on the effects of foreign direct investments (FDI) in the last two decades, regarding relation of FDI to the export of goods and high-tech exports in transition economies, based on correlation analysis and including time-lag of one year. This analysis is covering eleven transition countries that are currently at different levels of economic development. As an imperative and guideline for the future, remains the focus on export oriented foreign direct investments, in order to harmonize two strategies on two fields: export competitiveness and attracting FDI.

by Anatoliy Kinakh, Prime Minister ofUkraine After a deep and long-lasting recession, the Ukrainian economy has for the past two years demonstrated some very positive dynamics in its quantitative development indicators. This is essentially the result of reforms, which still require to be consolidated in order to engage the factors and mechanisms capable of ensuring long-term qualitative and sustainable development in our economy. How do we ensure sustainable growth, and realise the improvements in the main macroeconomic indicators together with serious and complex improvements at the micro-level, which would allow us to achieve the urgently needed shifts in the social sphere? These actual problems are the main priorities of macroeconomic policy. Furthermore, the search for solutions to these problems of our transitional economy requires profound scientific analysis. The following presentations made at the Conference on "Factors of Economic Growth in Ukraine" are serious scientific contributions by prominent economists in this field

The subject of this paper is an analysis of advantages and disadvantages of international investments - foreign direct investment (FDI) with a brief overview of the Republic of Serbia and its level and structure of FDI. Foreign direct investment is an important factor in development, especially in developing countries and countries in transition. Countries in transition, which includes Serbia and all Western Balkan countries feel a lack of capital, so it is important for them to fill the gap with foreign direct investment. For countries with current account deficits, FDI is used to increase exports and alleviate current account deficit problems. Based on experience and theoretical consideration, the paper points out the necessity of changes in our business environment, in order for Serbia to use foreign direct investments (with all its negative characteristics) which can and must give a special contribution and impetus to its economic growth.

It has been suggested that foreign direct investment (FDI) can play a key role in the process of restructuring generally (Robock and Simmonds, 1983) and in transition economies in particular. Dunning (1993) considered that ‘the economies of ECE (Eastern and Central Europe) offer a tremendous challenge and opportunity to foreign direct investors’. Blanchard (Blanchard et al. 1991) has argued that FDI had an important role in creating the conditions in which the advantage of low labour costs could be maximized. As such, many countries in transition see FDI as a very important driver of economic change, especially as there is often a shortage of capital for investment in the country.KeywordsForeign Direct InvestmentHost CountryOrganize CrimeFinancial TimeTransition EconomyThese keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

Small economy, well known as S&M, is important part of every national economy. Around 60% to 70% of total employment is employees in S&M in all European countries. S&M is key factor of social and national economic stability. That is why developed countries take special attention to S&M.Companies what belong to S&M from developed European countries attempt to be included in global business trends, for example they are included in export-import businesses outside of Europe and their portion in these kinds of businesses are 10%. Countries in transition are just trying to manage development of S&M, it means development of S&M is happening spontaneously. Transition from central planning economy to market economy has been paid with lower quality of development for S&M. Export-import businesses where are included S&M companies from countries in transition are linked only for neighboring countries and there is almost no any intercontinental businesses.The world financial crises are much deeper than what was expected, because there is no ideas how to solve these financial problems. The biggest corporations in the world are not prepared to solve social and economic problems in national economies. That is why S&M is getting more important role in global economic stability. Further to economic crises the role of government in national economy has been replaced by regional and local economies. It means S&M companies are together with local areas become factor of development for sustainable economic development and manage this development.Comparative analyses of S&M in developed European countries and European countries in transition for the first level of analysis, showed high level of similarity for strategic positioning of S&M in national economies. Analysis of basic factors for development, apropos characteristics of factors for development showed important differences between developed European countries and European countries in transition. What kind of unfavorable specificities of S&M for countries in economic transition making influence? On what way is possible to contribute for development of S&M for countries in transition? What has to be the role of government for development of S&M for economies in transition, compare to developed European economies? How to link S&M from developed European economies with economies in transition? These basic questions will be answered in this analysis and in the same time will join to requirements for incentive development of S&M and eliminate key differences between S&M in developed European economies and European economiesin transition.

Nearly all developing countries actively seek capital and technology from the advanced countries. Although private direct foreign investment (mainly in the form of multinational enterprise) is viewed with ambivalence by many developing countries, it is nonetheless true that direct investment remains a substantial source of capital and is sometimes the only source of specific technologies. Indeed, given the slow growth in official external assistance, developing countries are becoming more, not less, dependent on direct foreign investment. While disbursements of official development assistance by the OECD countries rose 43% from 1961 through 1970, direct investment flows rose almost 90% over the same period. In the later year, the flow of direct investment was more than two-fifths of all official assistance, $3.2 billion compared to $7.8 billion.1 Furthermore, the United States and other major capital exporting countries would prefer, for economic as well as ideological reasons, to channel more of their capital outflows to developing countries through private investment. It is highly probable, therefore, that developing countries will continue to rely on direct foreign investment in the foreseeable future to carry out their development programs. It is against this background that the present study seeks to identify the empirical determinants of direct foreign-investment flows in the manufacturing sectors of developing countries. Our purpose is to select from the many economic, social, and political features of a developing country those features that are critical to making that country attractive or unattractive to private foreign investors. Available empirical studies are limited

This article examines the impact of foreign direct investment (FDI) policy on inward FDI in the Visegrad and Baltic countries. The analysis of business environment highlights that the countries in both regions attempt to create a friendly business environment by means of similar methods. However, the countries in both regions focus on fiscal incentives such as taxes, which do not play a major role in attracting inward FDI in R&D. The results of attracting FDI are better in the Visegrad countries, which implement financial incentives toward inward FDI along with fiscal incentives. According to empirical analysis, it is noticed that a higher intervention level and a higher support level guarantee the volume of inward FDI. The country's introduced FDI policy enables it to orient industry and to implement economic strategic targets. FDI policy does have an impact on promoting the development of the entire country.