Central European economies depend on Developed Europe for 70% of their exports as remittances fall; Austria faces headwinds
Mar 25th, 2009 | By Finfacts Ireland Business & Finance Portal | Category: News worldwide
Morgan Stanley economists say that the Central European economies (Czech Republic, Hungary, Poland, Romania) are heavily influenced by developments in their richer western neighbours. Developed Europe accounts for around 70% of all CE exports; its banks dominate lending, with a market share of around 80% on average; migrant remittanceshave flowed East since 2004 and FDI inflows from Western European companies have proved to be a significant engine of growth over recent years. Meanwhile,
Deutsche Bank Research says Austria is facing headwinds as financial markets have become increasingly worried about Austrian banks’ large loan exposure to the region. The strong financial and trade links with Eastern Europe, which have boosted Austrian growth over the past few years, have now become the Achilles’ heel of the Alpine Republic. 