Foreign direct investments-expected inflow: Reality or great illusion

Abstract

For more than ten years the Yugoslav economy and its industry are undergoing a very serious economic crisis, leading not only to a drastic deterioration of all economic performances, but above all to a dramatic exclusion form the world economic flows, being characteristic for the process of globalization and initiated by the world most powerful countries. In the pre-globalization period the firm's expansion was performed through an increased export. In the last three decades a considerable change took place, when instead of their export expansion large companies increasingly began to base strategies of access on foreign markets on direct international investments, new forms of international trade and international agreements and cooperation. The essential problem (possibly even the preliminary one), i.e. a necessary condition for the Yugoslav industry's further development is to find out an appropriate for inclusion into the process of globalization. At this moment his paper's ambitions are a bit more modest. The basic idea is to discuss the distribution of direct foreign investments from the geographic aspect with a somewhat more detailed analysis of the direct foreign investments inflow in the countries of Central and Eastern Europe, and to look for an answer to the question what are the chances of Yugoslavia to attract a larger amount of direct foreign investments, since their lack would lead to an intensification of the economic crisis, i.e. impossibility of any serious economic development, thus leaving our country to lag behind at the far civilization periphery of the world.