Doing business and working outside government regulation and tax systems in eastern Europe is so widespread that it risks undermining the region's long-term growth potential, says a World Bank report released on Monday (10 September).
"The governments of the new member states in Eastern Europe simply cannot afford a large shadow economy, neither in the short run due to fiscal concerns, nor in the long run due to the shrinking labour force," said World Bank senior adviser, Katarina Mathernova.
The report looked primarily at Bulgaria, the Czech Republic, Estonia, Hungary, Lithuania, Latvia, Poland, Slovenia and Slovakia.
Read more: EUobserver.com / Economic Affairs / Shadow economy in eastern Europe undermines growth, says World Bank
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