The Lisbon Agenda and the Relocation of Economic Activities Abroad OUTSOURCING, FDI AND EUROPEAN ECONOMIC INTEGRATION The economies of Central, Eastern and South-Eastern Europe are expected to experience a surge in FDI in the years to come. The UNCTAD World Investment Report 2004 expects FDI to increase steadily in the EU accession countries as well as in other CSEE countries. The lion's share of global and European FDI, however, is expected to flow to India and China. Given this, it would seem inappropriate for policy makers to focus their concerns over outsourcing mainly on the CSEE countries and thereby risk jeopardising their economic development and transition. Indeed, FDI flows to these countries will enhance their economic integration with other parts of Europe and the world economy as a whole- a process accelerated, as the case may be, through EU accession, ongoing or expected accession negotiations, or other arrangements with the EU such as its “Neighbourhood Policy”. This in turn means increased trade and potential capital flows in the opposite direction, that is, from the CSEE to Western European countries. As we have seen, companies in many CSEE countries already engage in FDI in Europe and globally. When seen in proportion to the economic size of countries, it turns out that developed countries are not the major source of FDI, but that indeed developing countries engage in more FDI as a share of their GDP(Mann, 2003). As has been shown above, relocation is complementary to increased trade, which fosters economic integration between Western European and CSEE countries, eventually leading to an even better functioning European market. The road to global competitiveness starts with competition at home. The best way to improve the competitiveness of the European economy on a global scale is to allow competition within and between the European countries. Relocation, being a corporate phenomenon, could contribute to that goal, as well as to a more balanced economic development across Europe, via indirect, non­governmentally driven, development assistance to less developed European economies. Sometimes multinationals are seen as wanting to play out one work side in one country against another located in a different country. For example, General Motors recently announced that 10,000 jobs would be cut in Europe over the next six months. Following that, however, workers in Germany, Poland and Sweden showed a remarkable degree of solidarity, leading the company to abandon any plans for imminent layoffs. 163