Economic integration between the EU and the CEECs has been happening quickly, mainly through trade and foreign investment. Some people think that a new phase of deeper integration is starting, with more foreign investment in the CEECs. This study looked at whether foreign investment in the CEECs has replaced EU exports and hurt jobs at home, and if it has been taken away from countries like Spain and Portugal. Using a detailed database on foreign investment by country and sector, the study found that these concerns are not true.