HUNGARY


A landlocked country with a large number of spa towns and hot springs
Home to Lake Balaton, the largest lake in Central Europe, Rubik’s cube and ballpoint pen.

Total area: 93,030 sq km (smaller than Indiana)
Population:  9.89 million
Government type: Parliamentary democracy
Administrative division: 19 counties (called “megye”), 23 urban counties (called “megyei varos”), and 1 capital city (called “fovaros”)
Capital + other major cities: Budapest (1.7 million) + (Debrecen (204,000), Miskolc (173,000), Szeged (165,000), Pecs (157,000), Gyor (128,000)
Currency: forint (HUF)
Languages: Hungarian (official) 99.6%, other or unspecified 0.4%
Ethnicity: Hungarian 84%, Roma 3%, Germans 1.3%, undeclared 15%
Religion: Roman Catholic 37%, Calvinist 11%, Lutheran 2.2%, Greek Catholic 1.8%, other 0.5%, atheist 1.5%, unaffiliated 16.7%, undeclared 27.2%
President: (Mr.) Janos ADER (since 10 May 2012)
Prime Minister: (Mr.) Viktor ORBAN (since 29 May 2010)
Date of EU accession: 1 May 2004
mapa



KEY FEATURES

  • Highly skilled and educated workforce of 10 million consumers
  • Borders seven other European countries
  • One of the least regulated economies in the CEE region
  • One of the most wanted FDI destinations in Europe
  • Strong automotive, electronics and service sector
  • The most developed biotech sector in the CEE region

MACROECONOMIC OVERVIEW

Hungary, similar to population and size to the Czech Republic, is one of the least regulated economies in the CEE region and one of the most wanted FDI destinations in Europe. The country has imposed austerity measures to overcome the consequences of the global economy crisis and unreasonable fiscal policy of the previous government, which helped to get Hungary back on the growing curve. GDP grew by 2.9% in 2015 and the European Commission estimates the GDP may grow by 2.5% in 2016 and by 2.8% in 2017. The purchasing power is on the rise as well and the GDP per capita (PPS) reaches 66% of the EU28 level. Hungarians earn EUR 800 a month on average.


The country has excellent infrastructure, ready-made industrial sites, offices and science parks and ranks 42nd in the World Bank’s Ease of Doing Business 2015 ranking surpassing Belgium and Italy.



Selected economic indicators, Hungary, 2010 - 2016

    2010 2011 2012 2013 2014 2015 2016*
GDP
Real GDP growth
%
0.7
1.8
-1.7
1.9
3.7
2.9
2.5
GDP at current prices
€ bn
96.24
100.70
98.97
101.27
104.24
108.75
Foreign trade
Exports
€ bn
80.82
87.84
85.93
89.01
93.04
100.15
Imports
€ bn
75.57
81.66
79.28
81.68
85.46
90.80
Balance
€ bn
5.24
6.18
6.65
7.39
7.57
9.35
Prices
CPI - average inflation rate
%
4.9
4.0
5.7
1.7
0.0
0.1
0.4
PPI - industry - average
%
4.0
4.1
4.1
0.6
-0.4
-1.0
Employment
Registered unemployment
%
11.2
11.0
11.0
10.3
7.7
6.8
6.4
Average monthly gross wage
735
763
771
777
770
800
Exchange rates
HUF/USD average
208.00
201.06
224.95
223.57
232.56
279.35
HUF/EUR average
275.48
279.37
289.25
296.87
308.57
309.86

*2016 - forecast
Source: Hungarian Central Statistical Office, Hungarian National Bank, Eurostat, IMF, 2016



KEY SECTORS


65% of the Hungary‘s GDP is accounted for by the services sector - with financial and real estate services being the main drivers together with trade, repair services and HORECA related services. Hungary’s key industry sectors include automotive production, electronics, chemicals, machinery and biotech - Hungary has the most developed pharmaceutical and biotechnology sectors in Central and Eastern Europe.


Automotive sector

The automotive industry is a key sector in Hungary, for it is a leading supplier for Central and Eastern European countries. Automotive sector, one of Hungary’s core industries, generates 21 % of total exports. The labour force in Hungary is well-educated but not fully employed, which makes it likely for the automotive sector to grow in the following years.


Construction

The bulk of the construction industry spending over the next few years will be devoted to the transport sector, where there is strong demand for new road and rail facilities. The market is hampered by strong price competition and local regulations, but there are business opportunities in the construction sector, as well as in the emerging regeneration and property development sectors.


ICT

The Hungarian ICT sector is a well-established and developed industry. The total ICT market in Hungary accounts for about 7.1% of the country’s GDP. The market is expected to grow further, under the influence of the private sector. Fierce competition has led to price and profit decrease in the hardware market.


Food and drink

The Hungarian food industry plays an important role in Hungary’s economy, with a total estimated value of about €8 billion. It represents around 14% of the total processing industries, buying 75% of the local agricultural produce, which accounts for 8% of Hungary’s total exports. It accounts for 5% of the GDP employing 5% of the active population.


Biotechnology

The importance of the biotechnology sector in Hungary is supported by the fact that biotechnology is one of the fastest growing sectors, which, due to its highly knowledge-intensive nature, creates knowledge-based jobs. Conditions in Hungary are conducive to the consolidation of the biotechnology industry (world-class basic research results, highly qualified researchers, outstanding traditions of the pharmaceutical industry and strength in related industries). The leading Hungarian biotechnology companies target mainly export markets (the EU, USA, Japan). Their presence in the world not only enhances the reputation of Hungarian biotechnology, but of high-tech industries as a whole.


EXPORTS & IMPORTS


Hungary belongs among the most open economies to international trade in Europe, in fact, Hungary’ s exports/gdp ratio is the third highest in the EU and is surpassed only by Luxembourg and Slovakia.


2015 export and import data:




Main import partners:
Germany - 26.1%
Austria - 6.6%
China - 5.8%
Poland - 5.6%
Slovakia - 5.4%


Main export partners:
Germany - 27.3%
Romania - 5.2%
Slovakia - 5.0%
Austria - 4.8%
Italy - 4.7%


Hungary external trade - 2015




See references for our track record in Hungary.



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Market Research in Hungary

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