Marjan Svetličič

Enhanced transition through outward internationalization : outward FDI by Slovenian firms

Origins of Slovenia and its Outward Internationalization: Introduction Slovenia - a new state of the world The history of outward investing. Outward Foreign Direct Investment in the 1990s: Legal framework and trends Geographical and industrial distribution Investment in the successors to the SFRY The importance of investigating companies. Investing Abroad: From Idea to Results: Motivations for outward investment Investing firms and foreign affiliates Barriers to internationalization Effects of outward investment. Case Studies: Characteristics and lessons of cases Gerenje Prevent Iskraemeco Krka Lek Kolektor Mercator. Lessons from Slovenia: The role of the government Is Slovenian case relevant? Conclusion.

World Economy: Challenges of Globalization and Regionalization

There is no doubt that we are living history today. Never before have the changes been so profound, so unpredictable and so fast. Although the collapse of socialism stands out as a landmark of such tectonic changes it is not the only change. On the one hand the gap between developed and less developed parts of the world as a whole is widening but on the other some developing countries are well on the way to narrow the gap. Growth rates in South-East Asia and some Latin American countries have surprised many. They have been continuously high for some years and promise to be so in the next period as well, while Africa is lagging far behind.

Outward FDI from New European Union Member States

One of the main characteristics of transition economies (TEs) was their modest integration with the world economy. The deregulation, privatisation and liberalisation that accompanied transition have sped up the internationalisation process, with the initial wave of inward internationalisation being faster and greater in volume than outward internationalisation. In spite of the rapid development of outward investing at the end of the 1990s the process led to large differences among transition countries and in many of them the potential of internationalisation has not yet been fully exploited. The new transition EU members are, apart from Russia, the main outward investors among TEs.

Slovenian catching up with the developed countries: when and how?

Purpose – The purpose of this paper is to provide assessment of the current status of economic development and policy suggestions as to how Slovenia can catch up with developed countries and close the development gap.Design/methodology/approach – The paper first analyses world development scenarios. Part two is devoted to the calculation of development gaps by novel time distance methodology in order to identify major reasons for lagging behind and concludes by providing policy ideas how to close these gaps.Findings – The time lag for GDP per capita with the EU 15 average is 18 years, and larger when Slovenia is compared to the successful small EU member states. The optimistic scenario of catching up in 16 years would require 2 per cent higher growth rate than EU 15 average. This time would be shorter if the government policy would promote the knowledge‐based economy, internationalisation, innovative capabilities and become more effective, responsive, flexibile and closing persistent implementation and co...

The restructuring role of outward foreign direct investment by Central European firms: The case of Slovenia

A survey of selected theories relevant to foreign direct investment abroad is the basis for predicting when outward FDI from more developed Central European Countries begins. Slovenian experiences are used as case studies. Although inward FDI is still dominant, outward FDI is picking up in terms of sales operations in developed countries, but also as manufacturing units in other Central European countries. It is argued that outward investment can promote the restructuring of traditional industries. Outward FDI is starting today at an earlier stage of development, not only as a result of the accumulation of firm-specific advantages, but also from a position of weakness in order to learn from abroad and to strengthen competitive advantages. Outward FDI enhances the process of restructuring where such internationalisation is synchronised with the loss of comparative advantages of home countries. The case of Slovenia is evaluated in terms of geographical allocation of such investments, sectoral distribution and dynamic changes.

Competitiveness of Small Countries

Discussions on country competitiveness have become widespread; however, country competitiveness means different things to different people. It is often used to mean the ability to sell more in foreign markets, a concept criticised by Krugman (1994:44) because its pursuit could lead to beggar-thy-neighbour policies and/or trade wars. Such a definition also contradicts the theory that all countries gain from international trade through comparative advantage, and it implies an acceptance of the mercantilist promotion of trade surpluses that was in vogue from about 1500 to 1800. We prefer to consider national competitiveness as a means to an end — the end being the well-being of the nation’s residents; however, we acknowledge that the measurement of well-being is fraught with difficulties, especially when predicting how the future will evolve (Daniels, 1991).

Unknown Multinational Enterprises: Top MNEs from Slovenia

Even a decade ago, discussing Slovene multinational enterprises (MNEs) in Slovenia would have been akin to swearing. MNEs were perceived as the “bad guys,” transferring profits abroad, hiding, and creating unbalanced development. MNEs were considered responsible for many of the country’s economic problems and for leading to a culture of political dependency. MNEs were synonymous with large firms from Western industrialized countries, exploiting other (frequently less-developed) countries. Until very recently, Slovenia’s own MNEs—that is, those originating in Slovenia and operating abroad—did not feature in public debates. Neoclassical thinking was also prevalent in academia during the 1990s: investing abroad was considered unpatriotic because capital was needed at home (Svetlicic 1996, 4). As recently as 2008 (following the “Top 25 Slovene MNEs” press release by Vale Columbia Center on Sustainable International Investment (2008)), several major Slovene newspapers sought to interview the authors on whether Slovene firms were, in fact, MNEs, as the general belief has been that Slovenia does not have MNEs.

The outward direct Investment from CEECs: Can their firms compete in the global market

Der Artikel analysiert das jungste Auftauchen von multinationalen Unternehmen (MNCs) aus mittel- und ostmitteleuropaischen Landern(CEECs), insbesondere der Tschechischen Republik, Estland, Ungarn, Polen und Slowenien. Die Mehrheit der MNCs aus den CEECs sind vorwiegend regional aktiv, sie sind aber auch global existent. Die geographische Zuordnung von FDI beweisen, das die physische Entfernung, kulturelle Nahe und historische Verbindungen relevant fur die Entscheidung der Investition sind. Fruhere Erfahrungen sind wichtig, mindestens genauso wichtig sind ehrgeizige Plane und das konstante Verbesssern von Vorteilen. MNCs von CEECs erfuhren einen positiven Nettoeffekt von FDI wie verbesserte Marktpositionen, Exportwachstum, hohere Effizien, die auch ihre Wettbewerbsvorteile erhoht.

Yugoslav Foreign Direct Investment in Less Developed Countries

This study focuses on the relatively new phenomenon of Yugoslav direct investment in LDCs. The main purpose of this chapter is to discuss the origin, evolution, specific characteristics and motivation of Yugoslav firms in LDCs. The focus is on four issues: (1) What are the major historical, economic and political variables that help to explain the growth of Yugoslav FDI in LDCs? (2) What are the motives behind Yugoslav direct investments in LDCs? (3) What factors prompted minority-owned Joint Ventures as the preferred form of investment in LDCs? (4) What are some of the problems and reasons for divestment?

FDI, the Crisis and Competitiveness of Transition Economies

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 FDIs 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 groups specific needs.