2011 Reports

Outward FDI from Slovenia and its policy context

Jaklic, Andreja

High export orientation originating from a small domestic market and experience in outward foreign direct investment (OFDI) from the pre-transition period helped Slovenian enterprises to internationalize early on after their country's independence and separation from the former Republic of Yugoslavia, making Slovenia one of the first outward investors among transition economies in South-East Europe. This facilitated a reorientation of international trade and investment toward developed economies after the loss of the Yugoslav market triggered by Slovenian independence. OFDI flows increased rapidly after the end of the 1990s. Following the global financial and economic crisis, OFDI flows fell significantly in 2009 and 2010, and in 2010, the OFDI stock decreased for the first time since 2000. With the help of OFDI, Slovenia's enterprises have grown considerably beyond the constraints imposed by the country's dynamic, but small, economy. Their foreign expansion is in line with national strategic priorities that include entrepreneurship, business internationalization and innovation.