Central and Eastern Europe Hold Opportunities for U.S. Exporters

As director of the Central and Eastern Europe/Russian region of the U.S. Commercial Service, the trade promotion arm of the U.S. Commerce Department’s International Trade Administration, I oversee our work to help U.S. companies connect with international buyers. The estimated $2 trillion Central and Eastern European market encompasses countries with tremendous diversity in size, industries and culture. Despite this diversity, the countries in the region also have much in common, making it an excellent place in which to do business:

● Business regulation reforms over the past five years have made Central and Eastern Europe much more accessible in terms of ease of doing business.
● The region’s growing middle-class is spending its new disposable income on long deferred consumer goods. The significance of the middle class is now an important and permanent factor in these economies.
● Low-cost access to the huge European Union (EU) market also makes the region an attractive base for serving EU-wide clients.

While a number of the countries in the region are EU members with euro-based economies, others hope to join this club in the near future. The established market economies such as Poland, Czech Republic and Hungary may be easier, more traditional markets for U.S. exporters, but the transitional economies like Bulgaria and Romania offer their own opportunities, such as major infrastructure projects.

Looking to highlight examples of key markets for U.S. businesses, we asked several of our senior commercial officers in the U.S. Embassies in the region to give their perspectives on some of these opportunities. Readers will discover that despite the economic slowdown, it’s an opportune time for U.S. businesses to position themselves to take advantage of new long-term sales opportunities through the export counseling, business matchmaking and other services offered by the U.S. Commercial Service.

Austria
Austria’s historical and economic ties to the growth markets of Eastern and Southeastern Europe make it a well-known base for serving those markets, says senior commercial officer Christopher Quinlivan. “At present, approximately 350 U.S. firms have subsidiaries, affiliates, franchisees and licensees in Austria, of which about 150 have regional responsibilities for Central European, Eastern European, or Balkan countries,” he says. “If your company is planning to expand its activities in Europe, the Austrian market deserves attention.”

U.S. products and services enjoy a good reputation in Austria where quality is as important as price. Along with its 8.3 million affluent German speakers, Austria is a dynamic and fully integrated member of the European Union. According to Quinlivan, the country’s manageable size and stable business environment make it an attractive market for U.S. exporters, as well as a useful test market for U.S. firms with an eye toward expansion into neighboring Germany and Switzerland.

Best prospects for U.S. exports: renewable energy, electric vehicle technology, electricity infrastructure, medical devices, drugs and pharmaceuticals, information technology, software, aircraft and parts, and outdoor equipment.

For more information on Austria, contact Christopher Quinlivan at Christopher.Quinlivan@trade.gov, or visit www.buyusa.gov/Austria.

Bulgaria
Nearly three years after joining the EU, Bulgaria is on the radar screen of U.S. firms for investment and business opportunities due to its political stability and steady economic growth, says Scott Pozil, senior commercial officer. “The Bulgarian Government introduced the lowest tax rates in the region—a 10% rate both on personal income and on corporate income, which contributed to strong foreign investment inflows,” he says. “Although the global financial crisis has slowed investment growth, particularly in the real estate and manufacturing sectors, U.S. companies are successfully conducting business across many sectors of the economy.”

Pozil adds that EU membership has brought up to 13 billion euros for infrastructure projects from 2007-2013. Bulgaria is also an excellent launching pad for sales into the European Union, Russia, Turkey and the Middle East. “The general attitude in Bulgaria is pro-American, and the Bulgarian market is receptive to American goods and services.”

Best prospects for U.S. exports: automotive parts and accessories, aerospace and defense, environmental technologies, franchising, medical, infrastructure projects, information and communication technologies, renewable energy and energy efficiency, safety and security, and travel and tourism. For more information on Bulgaria, contact Scott Pozil at Scott.Pozil@trade.gov, or visit www.buyusa.gov/Bulgaria.

Croatia
Known to many as a tourist destination, Croatia is also known for its well developed ports and modern transportation infrastructure and is achieving new success in niche manufacturing. “With continuing highway construction and increased air links, Croatia’s distribution network is among the best in the region, making Zagreb, Croatia’s capital, a logical choice as a sales and marketing hub for Southeast Europe,” says senior commercial officer Pamela Ward. “Together with its stable government and economy, Croatia’s importance in the region greatly exceeds its comparatively modest size and population.”