The Impact of the International Economic and Financial Crisis on the Current Accounts’ and Foreign Direct Investments’ Trends in the New Member States of the European Union

The global economic and financial crisis has had an impact on the economies of the new Member States of the European Union (NMS) since September 2008. After the outbreak of the crisis, these countries’ external deficits have diminished. In the new Member States, which had the highest current account deficits before the crisis, the adjustment has been particularly significant. The global economic and financial crisis lapped over certain specific characteristics and economic developments of the new Member States of the European Union (NMS), exacerbating or counterbalancing them. In this article, the authors have set themselves, through a case study, to identify the economic specificities of each European Union new Member State and to highlight the way the crisis has affected the external position of these countries, by comparing the level of external balance, the level of foreign direct investments inflows and the way of covering the capital and current account, before and after the crisis. The authors also point out the factors on which will depend on the development of the balance of payments of the European Union new Member States in the medium term: improving the export capacity of national economies and ensuring a sustainable development of domestic demand, particularizing the structural elements of these factors. A third idea discussed in this article refers to the fact that strong adjustments of external deficits were accompanied by a tightening of financing conditions and by major changes in the financing structure.