Competitiveness in the Food Industry: a CGE Modelling Approach to assess Foreign Direct Investment in Transition Countries
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For transition countries, the food industry sector is a key industry in terms of output and
employment shares. As a competitive sector that receives substantial foreign direct
investments (FDI), it plays an important role as an element in the process of integration in the
European and world market. The GLOBE Computable General Equilibrium model is applied
to analyse scenarios of alternative development pathways of the food industry sector, taking
into account the impact of FDI in the European food industry. The scenario analyses of this
study identify that with an enhanced attraction of FDI in the food processing industries in the
New Member States (NMS) the integration of the agri-food sectors in the NMS into the
Single European Market will become even stronger.