Industrial Policy in the New Member Countries of the European Union: A Survey of Patterns and Initiatives Since 1990

The transitional recession in the new Central and East European members of the EU called for completely novel approaches to industrial policy in the nineties. A strong rejection of industrial policy could be observed only in some countries and during the first years of the transition process. Subsequently however, deteriorating competitiveness, soaring unemployment and the dramatic condition of key export sectors made the reappearance of supply-side economic policy thinking inevitable in most Central East European Countries (CEECs), except for such small and open economies as Slovenia and Estonia. A wide variety of industrial policies implemented in the CEECs are compared in the study, with special emphasis on tools used in order to promote incoming foreign direct investment, technological development and the small and medium-sized enterprise sector. These elements of the industrial policy toolkit will keep their key role in most CEECs, albeit their industrial policies will gradually align themselves to the European mainstream.