Outsourcing Chasing Cheap Labor to the East

Talk about investment flows. A decade ago, foreign investment began to pour into Poland, the Czech Republic and Hungary as West European and U.S. companies looked for a low-cost manufacturing base close to the European Union. Today, as these and seven other countries join the E.U., the East and Central Europeans themselves are looking east for low-cost manufacturing. As rising wages force them to find ways to become more competitive, some are setting up plants or outsourcing their production to subcontractors in places like Bosnia, Romania, Russia and Ukraine. The investment farther east isn't yet a flood, but economists and trade...