Common drivers of FDI in Hungary, Slovakia, Czech Republic, Slovenia, Croatia, Poland, and Lithuania are identified in this paper and relationships among financial variables are described that permit policymakers to create guidelines and strategies for a more profitable environment for economic growth.  Statistics identify the drivers of FDI in the focus countries.  And qualitative field studies for Slovenia, Slovakia, and Czech Republic corroborate the statistics while incorporating factors such as geography, legal and banking systems, social structure, and stages of economic and political development into the analysis.

  Purposes, Contributions, and Methodologies of This Study
The primary contributions of this research are twofold.  One, the fresh look at the focus countries with current data and statistical methodology gives previous research a large measure of support in the correlations and provides new insights into cointegration of the variables.  Two, the qualitative studies highlight original and primary sources resulting in the conclusions reached and ideas presented.  Qualitative methodology may make the results of the research more accessible to those who know case and field study methodology but do not know international finance.  Likewise, researchers who know the field of international finance may glean new insight into variables that affect foreign investment from a qualitative point of view.  The accession countries are dealing not only with their own economies and politics, but are also addressing the larger issue of becoming part of the European Union.  Therefore, the important question of funding arises – funding to support the many activities and programs to meet the monetary, fiscal, social, political, and market standards of the EU.  Consequently, the contribution to the literature is direct and beneficial to those determining policy for the various countries’ legal, banking, and capital markets mechanisms and their fit with larger economic and political groups.

 Conclusions
One common driver to all focus countries using the Johansen Cointegration Trace Rank Test is the exchange rate (XR), with a strong effect on all except Croatia where the effect is mild.  So fostering factors to strengthen a currency increases FDI while a weaker currency tends to discourage FDI inflows.  FDI and other financial flows contribute to higher growth (Schadler et al 2006), the policy objective in attracting FDI.

 Current account (CA) is another common driver of FDI, with a strong effect in all countries except Hungary.  The stock market (SM) has a strong effect on five of the seven focus countries, the exceptions being Croatia and Czech.  The last common driver of FDI with a strong effect is the lending rate (LR), having the effect on all except Croatia and Poland.

  VAR analysis supports the cointegration work for SM and XR effects in five of the seven countries.

The field studies indicate low country or business risk, high quality workforces, and stability as members of the EU and NATO.  The choice of where to invest then depends on the investor’s comfort level with factors like culture, size of economy, and political climate.