Since the mid-2000s, this process has been greatly furthered by exceptionally favorable global financial conditions, with abundant liquidity, low risk aversion, and falling long-term interest rates. Financial integration in Central and Eastern Europe The transition countries of Central and Eastern Europe were the recipients of a massive influx of capital from abroad, mostly from Western Europe.
Between 2003 and 2008 capital inflows reached very high levels – averaging more than 12 per cent of GDP – compared with an average for the emerging market countries overall of about 6 per cent (Figure 5).