“Hungary’s importance has increased within the European Union; the country has a greater influence than before and compared to its size in Europe in both economic diplomacy and foreign policy”, Minister of State László Szabó from the Ministry of Foreign Affairs and Trade said on Tuesday in Budapest.

At a conference organised by Hungarian economic weekly and internet portal Világgazdaság, the Minister of State added: despite the fact that the political elite “do not like Hungary”, as a result of its determined, transparent and good decisions during the course of the migration crisis it is receiving “a host of receptive feedback” from German CEOs who believe Hungary has protected not only the Schengen system and its own borders, but also their economic interests.


Photo: Ministry of Foreign Affairs and Trade

It is good to see that economic interests are in harmony with foreign policy interests, he noted. Mr. Szabó highlighted the fact that it had been a good decision to reorganize the Ministry of Foreign Affairs and Trade according to macro-economic interests, as a result of which added value in Hungarian exports has increased, which is important in making economic growth sustainable. There is a good chance that the foreign trade surplus for last year will reach 8 billion euros, he added.

The Minister of State told the press that the Government’s program of opening towards the East “is working well despite claims to the contrary”, with a 1 percent increase in exports year-on-year. This counts as a successful performance in view of the fact that Hungarian exports to Russia and Ukraine have fallen by 28 percent and 20 percent respectively as a result of sanctions and exchange rate effects, he explained.

Growth and diversification have begun in an eastern and southern relation while retaining previous positions in the west, and the Ministry will continue this strategy this year, he said.

Photo: Ministry of Foreign Affairs and Trade

Among Hungarian export successes, the Minister of State mentioned the first major order for electric buses, with 50 new electric buses on their way to Moscow. The first shipment of European beef to China arrived two weeks ago, the first such shipment of its kind, he told the press. According to Mr. Szabó, it will be easier to export pork and later also poultry to China as a result. Hungary has the most food industry export licences in the region, which represents a major competitive advantage, he said.

The Minster of State also spoke about the fact that the Government is making it easier for Hungarian enterprises to receive funding, in addition to which administration and eligibility requirements relating to individual government decisions have been reduced. In some cases no level of investment is specified; it is enough for a company to create 50-100 new jobs, he added.

Mr. Szabó said last week’s Slovenian-Hungarian joint cabinet meeting, where agreements were reached on the interconnection of the gas corridors, the full electrification of railway lines and the rail development of the Port of Koper, which is the closest industrial port to Hungary, had been a success.

Minister of State for Economic Development and Regulation István Lepsényi from the Ministry of National Economy stressed the fact that small and medium-sized enterprises must recognize that it is only with new products, product development and modern thinking that they can successfully tap into the supply chain and increase their weight within the national economy, adding that although according to the latest figures the Hungarian SME sector is characterized by stability, the efficiency of enterprises operating within the sector compared to the number of people they employ falls far behind the European average.

The SME sector, which represent over 90 percent of the 550 thousand enterprises operating in Hungary receive 58 percent of net revenues and contributed 54 percent to gross added value, while employing 72 percent of the country’s workforce, he explained.

Some 12 thousand enterprises contributed 27.6 percent to exports, which according to the Minister of State represents poor to average performance.

On the subject of financing factors, Mr. Lepsényi highlighted the fact that the Government is providing almost 2000 billion forints (EUR 6.4bn) to SMEs within the framework of the Economic Development and Innovation Operational Program (GINOP), with over 300 billion forints available towards this goal this year. It is important that the efficiency of development projects should be increased, he pointed out. According to the Minister of State, there are great opportunities in Hungarian pharmaceutical production and tool production, where there are fewer large multinational companies on the market than in other sectors. Many new automobile industry research and development centers have also been established in Hungary recently, and the Government would like 30 such centers to be created by 2020, he said.

One of the most important tools for the realisation of national economy goals is the jump-starting of business loans and the development of new loan products, Mr. Lepsényi highlighted.

{Source: Hungary Ministry of Foreign Affairs and Trade/MTI}

[photo credits-featured image: By Godot13 (Own work) [CC BY-SA 3.0 (http://creativecommons.org/licenses/by-sa/3.0)], via Wikimedia Commons]