The Central and Southeastern Europe region has emerged as one of the most rapidly growing areas in the world. Boasting a population of over 120 million, it constitutes one-third of the European community. In the past decade, this region has experienced growth at a rate three times faster than the rest of Europe.
The landscape is now dominated by a mix of large state-owned enterprises, as well as new American and Northern European companies, which together account for about 25% of the professional workforce. Central and Southeastern Europe is already acknowledged as a development hub, and its growth is accelerating across various industries as local firms raise salaries to compete for and retain talent, and the influx of foreign workers increases.
The landscape is now dominated by a mix of large state-owned enterprises, as well as new American and Northern European companies, which together account for about 25% of the professional workforce.
25%
More developed markets in the region tend to have a higher number of foreign workers, a trend expected to continue in Southeastern Europe. In contrast, ‘old Europe’ has a smaller proportion of foreign workers. This dynamic is fueling a lifestyle boom, with talented individuals seeking better opportunities, and products and a massive raise in startups and new ventures.
Percentage of professional Foreign workers:
However, the Central and Southeastern Europe market is not without its challenges. The region’s diverse languages, customs, and entrenched religious practices create a complex and demanding business environment. Many European companies initially thought they could dominate this market from afar, but it has become evident that strong local representation is crucial for success.
Currently, over 6 million business entities – ranging from large corporations to SMEs – operate within this market, and it continues to expand. Growth forecasts for Central and Southeastern Europe are 1.9% higher than those for Northern Europe, demonstrating the region’s immense potential.
Growth forecasts for Central and Southeastern Europe are 1.9% higher than those for Northern Europe, demonstrating the region's immense potential.
1.9%
Some of the factors contributing to this:
- Croatia joined the Euro-zone Jan 2023. The EU has prioritized investment into Croatia with over €9 billion going to the country and €1,7B earmarked for company growth.
- Legacy dependence on Russian fuel (oil & gas) has forced the EU to invest massively in the region
- SE Europe is surrounded by runaway inflation and collapsing economies:
- Turkey-+70% inflation
- Ukraine -33% collapse of their economy (although 60% of that is now foreign aid)
- Worrying concerns over the EU inflation rate of 9.9% in February 2023, although now down to 8,3%