Yugoslav Multinationals Abroad

144 Pages·1992·4.78 MB·English

by  Patrick Artisien

YUGOSLAV MULTINATIONALS ABROAD
Also by Patrick Artisien
JOINT VENTIJRES IN YUGOSLAV INDUSTRY
MULTINATIONALS AND EMPLOYMENT (with PeterJ. Buckley)
DIE MULTlNATlONALEN UNTERNEHMEN UND DER ARBEITSMARKT
(with Peter J. Buckley)
*NORTIl-80UTH DIRECT INVESTMENT IN TIlE EUROPEAN
COMMUNmES (with Peter J. Buckley)
YUGOSLAVIA TO 1993: BACK FROM TIlE BRINK?
Also by Carl H. McMillan
*MULTINATIONALS FROM TIlE SECOND WORLD: GROWTI:l OF
FOREIGN INvEsTMENT BY SOVIET AND EAST EUROPEAN STATE
ENTERPRISES
JOINT VENTIJRES IN EASTERN EUROPE: A TIlREE-COUNTRY
COMPARISON (with D. P. St Charles)
TIlE EAST-WEST BUSINESS DIRECTORY
PLANNED ECONOMIES CONFRONTING TIlE CHALLENGES OF TIlE
19805 (with J. P. Hardt)
Also by Matija Rojec
NEW FORMS OF EQUITY INVESTMENT BY YUGOSLAV FIRMS IN
DEVELOPING COUNTRIES (with M. SvetliciC)
INVESTMENT AMONG DEVELOPING COUNTRIES AND
TRANSNATIONAL CORPORATIONS (with M. SvetliciC)
TECHNOLOGICAL TRANSFORMATION OF TIlE TIlIRD WORLD:
PROGRESS ACHIEVED AND PROBLEMS FACED: CASE STUDY OF
YUGOSLAVIA (with M. SvetliciC)
*Also published by Macmillan
Yugoslav
Multinationals
Abroad
Patrick Artisien
Lecturer in East European Economics
University of Cardiff, United Kingdom
Visiting Associate Professor, European Institute of Public
Administration, Maastricht, The Netherlands
Visiting Research Fellow, Centre for International Cooperation and
Development, Ljubljana, Yugoslavia
Carl H. McMillan
Professor of Economics
Carleton University, Ottawa, Canada
and
Matija Rojec
Senior Research Fellow,
Centre for International Cooperation and Development, Ljubljana,
Yugoslavia
Foreword by
Peter J. Buckley
Professor of Managerial Economics
University of Bradford Management Centre, England
M
© Patrick Artisien, Carl H. McMillan and Matija Rojec 1992
Foreword © Peter J. Buckley 1992
Softcover reprint of the hardcover 1st edition 1992
All rights re~erved. No reproduction, copy or transmission of
this publication may be made without written permission.
No paragraph of this publication may be reproduced, copied or
transmitted save with written permission or in accordance with
the provisions of the Copyright, Designs and Patents Act 1988,
or under the terms of any licence permitting limited copying
issued by the Copyright Licensing Agency, 90 Tottenham Court
Road, London W1P 9HE.
Any person who does any unauthorised act in relation to this
publication may be liable to criminal prosecution and civil
claims for damages.
First published 1992 by
THE MACMILLAN PRESS LTD
Houndmills, Basingstoke, Hampshire RG2l 2XS
and London
Companies and representatives
throughout the world
ISBN 978-1-349-12130-4 ISBN 978-1-349-12128-1 (eBook)
DOI 10.1007/978-1-349-12128-1
A catalogue record for this book is available
from the British Library
This book is dedicated to the memory of
Fred Singleton
Contents
List of Tables ix
Notes on the Authors xi
Foreword by Peter 1. Buckley xiii
1 INTRODUCTION AND OBJECTIVES 1
The Phenomenon of Yugoslav Direct Investment 2
2 CONTEXTUAL AND THEMATIC ASPECTS 5
Integration into the World Economy 5
Development of International, Inter-Firm Linkages 7
Growth of East European Foreign Direct Investment 9
The Special Character of the Socialist Multinational
Enterprise 17
3 YUGOSLAVIA IN THE WORLD ECONOMY 23
Evolution of Yugoslavia's Foreign Trade 23
Long-Term Cooperation with Foreign Partners 27
Yugoslav Industrial Activities Abroad 29
Origins and Evolution of Yugoslav Multinationals 30
4 PROFILE OF YUGOSLAV EXTERNAL
INVESTMENTS 38
Geographical and Functional Distribution 38
Scale of Operations 43
5 METHODOLOGY 50
The Questionnaires 52
The Sample of Western Firms 52
The Sample of LDC Firms 54
Summary 55
6 YUGOSLAV INVESTMENTS IN THE WEST 56
Motivation 56
Success 60
Entry Strategy 62
Functional Control of Subsidiary 66
vii
viii Contents
7 YUGOSLAV INVESTMENTS IN THE
THIRD WORLD 70
Motivation 70
Ownership Patterns 74
Problems and Reasons for Divestment 82
8 CONCLUSIONS AND FUTURE PROSPECTS 88
Appendices
A Questionnaire for the Attention of Yugoslav Firms
Investing in the West (Parent Company) 93
B Questionnaire for the Attention of Yugoslav Firms
Investing in the West (Affiliate) 102
C Questionnaire for the Attention of Yugoslav Firms
Investing in Less Developed Countries (LDCs) 110
D List of the 40 Largest Yugoslav Enterprises, 1989 114
Notes 116
Bibliography 122
Index 125
List of Tables
2.1 Number and geographical distribution of Soviet and
East European companies in the West, end of 1989 13
2.2 Distribution by activity of Soviet and East European
companies in the West, end of 1989 14
2.3 Number and geographical distribution of Soviet and
East European companies in LDCs, end of 1989 16
2.4 Distribution by activity of Soviet and East European
companies in LDCs, end of 1989 17
3.1 Average annual percentage rate of real growth of
Yugoslav social product, exports and imports,
1948-88 24
3.2 Changes in the structure of Yugoslavia's foreign
trade, 1952-88 26
3.3 Yugoslavia's foreign trade by main region, 1984--9 27
3.4 Number of Yugoslav economic entities abroad,
end of 1988 33
4.1 Number, location and distribution by principal activity
of western subsidiaries of Yugoslav companies, 1987 39
4.2 Ownership structure of Yugoslav FDI in the West,
end of 1988 41
4.3 Number, location and distribution by principal activity
of representative offices of Yugoslav companies in the
West, 1987 42
4.4 Number, location and distribution by principal activity
of Yugoslav investments in LDCs, 1987 44
4.5 Ownership structure of Yugoslav FDI in LDCs,
end of 1988 46
4.6 Performance indicators of Yugoslav firms abroad,
1983-8 48
4.7 Foreign trade conducted by foreign subsidiaries and
affiliates of Yugoslav firms, 1983-8 49
4.8 Number of employees in 42 Western subsidiaries 50
5.1 Principal activity of 25 sample Yugoslav firms in
the West 53
5.2 Indicators of size of 15 largest sample Yugoslav
parent companies in LDCs, 1986 55
6.1 Motivation for foreign investment by Yugoslav firms 58
ix
x List of Tables
6.2 Profit Margins of Western Subsidiaries, 1987 61
6.3 Success indicators 62
6.4 Sources of information about Western host countries 65
6.5 Yugoslav personnel seconded to overseas subsidiaries 67
6.6 Decision-making in 8 key functional areas 68
7.1 Motives of Yugoslav investors in LDCs 72
7.2 Reasons for preferring a minority-owned
Joint Venture 76
7.3 Impact of legal constraints in 15 LDC host countries
on percentage share of equity in Yugoslav
minority-owned Joint Ventures 78
7.4 Major problems of Yugoslav enterprises in
developing countries 83