The advantages of Central and Eastern Europe consist of labor costs and workforce availability. The disadvantages consist of the confidence offered by the justice system, the education system and traffic infrastructure, the ING study shows, citing a Deloitte analysis.
ING also points out in its study that salaries are growing fast in countries in Central and Eastern Europe, maybe too fast to be sustainable. Moreover, reforms in the education systems in Romania and Bulgaria are overdue, implying challenges on a medium term for the labor market, the study also shows.
According to the ING study, most countries saw improvement in competitiveness. Bulgaria is the best reformer in Central and Eastern Europe in terms of competitiveness, but, compared with Germany, the countries do not fare the same in terms of infrastructure and education quality.
Investors are lured by the local market of a country or region (37%), 30% are interested in logistics and transport infrastructure, 29% want an increase in productivity for the company, 24% of respondents are interested in labor costs and 22% require a certain level of labor skills, according to an analysis by EY, cited in the ING study.