Financial Integration, Vulnerability to Crisis, and EU Accession in Five Central European Countries.

The objective of this study is to help assess the possible vulnerabilities in a number of Central European countries as they proceed with global financial integration and EU accession. The report focuses on those countries slated to be the first in the region to join the EU, the Czech Republic, Estonia, Hungary, Poland, Slovenia (CE5). The study: * Discusses the context and presents a short description of the CE5 countries' experience in attracting capital flows * Analyzes the manifestations of vulnerability to financial crises and sustainability of foreign capital flows to the CE5 * Interprets the results and draws implications in view of the initial conditions of the various countries * Compares the EU accession of the CE5 to the Southern Mediterranean countries' accession to the EC in the 1980s * Draws conclusions and makes recommendations .