Hungary’s Exports Could Achieve Record Levels Again This Year
Exports could achieve record levels again this year; the total value of Hungarian exports could exceed 100 billion euros for the first time ever based on figures for the first nine months of this year”, Minister of Foreign Affairs and Trade Péter Szijjártó said in Budapest at Monday’s session of Parliament’s Economic Committee.
Mr. Szijjártó told the Committee that in 2016 the Hungarian economy had produced its best ever performance in every single field with 93 billion euros in exports and a foreign trade surplus of 10 billion euros.
“The total value of exports increased by 3 percent compared to 2015, 10 percent compared to 2014 and 30 percent compared to 2010”, he added.
“During the first nine months of this year, exports increased by 9 percent, which is 6.1 billion euros more than in the same period of the previous record year, with four fifths of exports destined for the European Union, a 10 percent increase in trade flow and a higher than average 12 percent increase in exports to countries outside the European Union”, Mr. Szijjártó said.
He added that as an export-orientated country it was the right decision to expand trade with the world’s most rapidly developing countries within the framework of the Southern and Eastern Opening policies, highlighting that Hungarian exports to the countries targeted by the Eastern Opening policy have increased by 15 percent, or 1.4 billion euros, with 26 percent more Hungarian goods exported to Russia compared to last year, 25 percent more to China, 22 more to India and 87 percent more to the Philippines.
“Exports to the countries involved in the Southern Opening policy increased by 22 percent or 323 million euros year on year from 1 January to the end of September, with exports to Mexico, Brazil and Argentina increasing by 58 percent, 26 percent and 147 percent, respectively”, Mr. Szijjártó told the Committee.
The Minister of Foreign Affairs and Trade said he was also expecting outstanding results with relation to foreign investments in Hungary in view of the fact that thanks to the investment promotion system 71 new major investment projects with a record total value of 1038 billion forints (EUR 3.3bn) were brokered in 2016, while 79 new investments totalling 949 billion forints (EUR 3bn) have already been announced during the first nine months of this year.
“18 of this year’s major foreign investments involve the info-communications sector and 6 are exclusively concerned with research and development activities, and for instance the world’s largest fund management company has brought its development centre to Hungary”, he added.
The Minister stressed that enterprises receiving state funding also include Hungarian companies, with the 14 companies of this kind representing the second largest group after the 23 German investors, who are followed by 9 companies from the United States on the list of investors by country.
“This also indicates that domestic enterprises have moved up a level and are now capable of major investments”, he added. Mr. Szijjártó pointed out that 29.5 percent of the value of industrial production is derived from the automotive industry, and 23 out of the 79 new investments announced so far this year come from this sector, followed by 9 from the service sector and 6 from the food industry. Mr. Szijjártó welcomed the fact that more and more foreign investors are choosing one of Hungary’s major rural cities instead of Budapest, and popular destinations include Szeged, Miskolc and Debrecen.
“The structure of investments has changed in view of the fact that thanks to the significant improvement in employment greater emphasis is being placed on the challenges of digitalisation rather than on job creations, and accordingly incentives must be provided for higher added value to ensure that enterprises create and apply the technological developments of the new era here in Hungary”, the Minister said.
“The investment promotion system has been reorganized accordingly, and investors may now also receive funding based on individual government decisions if, while maintaining jobs, they realize technological investments in the interests of improving their productivity or competitiveness”, he added.
The Minister pointed out that the incentive system has been modified in recent months following discussions with those involved, for instance the minimum threshold required for technological investments to receive government funding has been reduced from 30 million euros to 20 million euros, the maximum level of funding has been increased from 25 percent to 75 percent, and companies that employ over 250 people are now also eligible for benefits providing they establish a new facility.
“In addition to expanding the export opportunities available to Hungarian enterprises, the Government’s most important external economic goal is to promote investment projects amidst the increasingly strong international competition for foreign investments”, Mr. Szijjártó told the Economic Committee.
[Source: Government of Hungary/Ministry of Foreign Affairs and Trade (MTI) -/- Media Relations]
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