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Global crisis and activities of multinational enterprises in new EU member states
Faculty of Technology, Policy and Management, Delft University of Technology (TU Delft), Delft, The Netherlands, and
Received May 2009 Revised April 2010 Accepted June 2010
United Nations Conference on Trade and Development, Geneva, Switzerland
Purpose – The purpose of this paper is to examine the potential impact of the 2008 economic crisis on foreign direct investment (FDI), especially in the new member states of the European Union. Particular attention is paid to the activities of subsidiaries of multinational enterprises (MNE), which can follow different scenarios as a response to the crisis, including a reorganisation of their production systems, and a reduction or closure of activities. Design/methodology/approach – The analysis is grounded on various streams of literature, including international business studies and research on transition. Evidence is derived from UNCTAD data, interviews and desk research. The method of descriptive analysis has been followed, combined with theoretical insights, conceptual discussions and case study evidence. Findings – While the full magnitude and consequences of the crisis are yet to be extensively analysed, the authors’ preliminary ﬁndings suggest that the response of MNE subsidiaries to the crisis hinges critically upon the type and the industry of such subsidiaries. Export platforms in automotive industries have been hardest hit. However, there are indications of the qualitative development of subsidiaries in other industries, despite the crisis, as well as growing attractiveness of new EU members FDI in services. Research limitations/implications – This paper is an explorative study on the impact of the crisis on subsidiaries. More academic research should be...