The proportion of a sample of FT top 500 companies interested in making investments there has declined to 66 per cent from 88 per cent in 1991. Only 35 per cent regard central and Eastern Europe as an important priority for their overseas investment.
The survey, conducted for the consultants Coopers & Lybrand, shows the main doubts about Eastern European investment are the uncertain legal and regulatory requirements, the lack of currency convertibility, political and economic instability and the problems of repatriating profits. All these were mentioned by three-quarters of the respondents. Corruption, personal safety and government bureaucracy were also big worries.
More than a third of those surveyed now have experience of investing in central and Eastern Europe and the former Soviet Union.
Only one in five companies expressed an interest in the former Soviet Union and a third would not consider it. The most popular countries for investment are Hungary (68 per cent), the Czech Republic (57 per cent) and Poland (46 per cent).
Hugh Christie of Coopers & Lybrand said: 'The initial excitement in the potential of these markets has clearly worn off. We firmly believe that good opportunities exist and that UK businesses are missing a trick.'