Multinational corporations and foreign investors in CEE: Western European multinationals in the CEE agro-food industry: The cases of Nestle, Unilever and InBev

Using Systems of Innovation Approach (SI) and International Business (IB) literature, this paper analyzes the level of embeddedness of Multinational Enterprises (MNEs) in Central and Eastern Europe (CEE). MNEs are discussed as they link the host country economy with the global economy by their regional and global networks. The expansion and successful embeddedness of West European multinational firms is crucial for the industrial integration of CEECs into the EU. The focus of the study is on the largest food processing companies, which invested in the region - namely Nestlé Unilever and InBev. The paper discusses the motives of investment and the entry strategies of food MNEs, outlines their contribution to the local development and stresses on the national actors as forces to embedded foreign direct investment (FDI). The paper discovered that EU membership facilitated the processes of global reorganizations of Nestlé, Unilever and InBev in CEE. All the three MNEs object of this research closed partially or completely plants all over CEE (and Western Europe). Hence, in a liberal trade regime it is very difficult to talk about long-term embeddedness of MNEs. It seems that the global strategies of the companies and the size of the market are the factor, which pre-determines the level of embeddedness of food MNEs in a certain economy and not so much the national actors and institutions.