Neven Mimica each(A Loss of Jobs or a Gain in Profits, 2004). Compared to US firms, most European firms have until now been reluctant to outsource business processing and IT. In Germany, manufacturing outsourcing accounts for 50% of total outsourcing and, apart from a few prominent examples(Deutsche Bank's decision in 2002 to outsource a large part of its European IT operations to IBM in a contract worth about$2.5 billion over its 10-year lifespan), firms are hesitant to engage in business process outsourcing(When Push Comes to Shove, 2004). In Italy, outsourcing is relatively low, due to the structure of its industry with relatively few large corporations and due to strong political and cultural constraints. Nordic telecommunication companies are slowly moving service centres to the Baltics. In Spain, there is a growing trend for outsourcing mainly to Latin America and northern Africa. A major constraint for outsourcing in the service and communications sector is a natural one, that is, language skills. German and English are widely spoken in Eastern Europe where it is not surprising to find a rise in service activities relocated from German- and English-speaking source countries. Figure 1. Top ten recipients of FDI inflows in 2002 and 2003 (in billions of dollars) Poland Chech Republic Hungary Croatia Romania Ukraine Bulgaria Serbia and Montenegro Russian Federation Estonia 1,1 1,7 1,1 1,6 0,7 1,4 0,9 1,4 0,5 1,4 1,1 0,3 0,9 4,1 4,2 2,6 2,8 2,5 3,5 8,5 2002 2003 0,0 0,5 1,0 1,5 2,0 2,5 3,0 3,5 4,0 4,5 5,0 5,5 6,0 6,5 7,0 7,5 8,0 8,5 * Ranked on the basis of the magnitude of 2003 FDI inflows. Source: UNCTAD, FDI/TNC database(www.unctad.org/fdistatistics). 152