What are the implications of the EU's Eastward Enlargement for the domestic information technology sector in Central and Eastern Europe?

Diplomarbeit von Ulrike Sauter

Abstract:

The current eastward enlargement process of the European Union differs from previous ones, both qualitatively and quantitatively. Never before has an equally high number of countries sought to join the European Union. Never before has there been a comparably high gap in level of wealth between the European Union and the candidate countries.

Enlarging the European Union brings great opportunities not only for international but also for domestic business. The latter ones however also face a number of challenges. For them, the Single Market turns out to be a doubleedged sword. They have to respond to increased domestic competition and adopt their operations to the regulations of the internal market.

In the so-called information society of the 21st century, the information technology sector plays a key rote in growth and development. European Markets as yet have not competed successfully with Asia and North America. The Information technology markets in Central and Eastern Europe though have a great potential and are particularly attractive for foreign investment. The implications for domestic information technology businesses in the candidate countries are however not clear. Local businesses denote little significance to the benefits of European Union membership and are preoccupied with defending the perceived threat of competition.

This dissertation examines the implications of European Union Eastward Enlargement for the domestic Information technology sector in the candidate countries and focuses an the significant rote of foreign direct. investment, competition, benefits and accession governments in the context of enlargement.

Table of Contents:

	Acknowledgement	i
	Abstract	ii
	Table of Contents	iii
	Glossary	v
	CHAPTER 1
1.	A New dawn for Central and Eastern Europe	2
1.1	Europe ponders its borders	2
1.2	European Eastward Enlargement and Business	3
1.3	The information technology sector	4
1.4	Aims and objectives	4
1.5	Chapter synopsis	5
	CHAPTER 2
2.	Literature Review	8
2.1	European Enlargement	8
2.2	FDI	11
2.3	SME development in transition economies	12
2.4	IT sector	13
2.5	Accession governments	17
2.6	The overall picture	18
	CHAPTER 3
3.	Research Design and Methods	22
3.1	Background	22
3.2	Secondary Data	23
3.3	Primary Data	23
3.4	Interviews	24
3.5	Structure	24
3.6	Limitations	25
	CHAPTER 4
4.	Findings	28
4.1	Findings Part 1	28
4.1.1	General Trends	28
4.1.2	Opportunities and Benefits	29
4.1.3	Threats and negative effects	32
4.1.4	Accession governments	34
4.2	Findings Part 2	37
	CHAPTER 5
5.	Discussion	42
5.1	Aims and objectives	42
5.2	FDI	43
5.3	Competition	47
5.4	Accession governments	48
5.5	Labour migration	50
5.6	IT sector	52
5.7	Benefits	53
	CHAPTER 6
6.	Conclusion	60
6.1	Aims and objectives	60
6.2	Conclusions	60
6.3	Limitations	62
6.4	Further Research	62
	Appendix	vi
	Bibliography	ix