Legal and Nonlegal Infrastructures Supporting Tourism Investment in Selected Former Eastern Bloc Countries

Abstract

International tourism investment in Eastern Europe has increased markedly since the end of the Cold War, creating some unique challenges for Western hospitality firms. A survey was sent to the legal counsel of international hotel firms present in the former Eastern Bloc countries of the Czech Republic, Hungary, Poland, and the Russian Federation. Legal and nonlegal reasons for investment in these countries are reported as a result of the survey. Legal investment catalysts include mutually beneficial profit repatriation codes; the regulation of national taxation of profits; equitable customs exemptions and tariff incentives; and the cooperation of local government. Nonlegal aids to investment include currency convertibility as well as political and economic stabilization.