Know what’s going on in Hungary – 29th week in 2020

See below main business and financial news from the previous week:

New travel restrictions introduced in Hungary: contradictory decisions were made

The Hungarian government announced new travel restrictions for Hungary. These take effect from Tuesday midnight. Restrictions were ordered by the government to avoid a second wave of coronavirus infections. The restrictions supposedly overlap with the EU’s recommendations, but some seem illogical and overcomplicated. Details HERE.

• Important modification announced to the new travel restrictions in Hungary
• LATEST: Inbound travel restrictions in Hungary eased for these two country

CONSTRUCTION SECTOR OUTPUT FALLS 20.1 PC IN MAY

Output of Hungary’s construction sector fell by 20.1 percent year-on-year in May – the steepest decline in years – because of the impact of the pandemic and a high base, the Central Statistical Office (KSH) said. Output of the buildings segment was down 24.0 percent and civil engineering output dropped 15.6 percent. Read more HERE.

LAWMAKERS APPROVE GUIDELINES FOR NEGOTIATING EU RECOVERY PLAN

Hungarian lawmakers identified “fundamental principles” to serve as guidelines in the course of accepting the European Union’s Next Generation recovery plan from the coronavirus crisis and the next seven-year EU budget. In a resolution approved with a vote of 128 for, 16 against and one abstention MPs said “member states in the same situation should be treated in the same manner”; “the citizens of richer member states should not get more support than the citizens of poorer countries”; and “attaching the funding to political and ideological conditions – under the label ‘rule of law’ – is unacceptable”. 

• Orbán: Netherlands to blame if talks on EU budget, rescue package fall through

AUTOMOTIVE SECTOR SHOWS SIGNS OF RECOVERY AFTER PANDEMIC SHUTDOWNS

Output of Hungary’s automotive sector, an engine of industrial growth under normal circumstances, fell 53.3 percent year-on-year in May, slowing from a 79.5 percent decline in April, when many plants shut down to contain the spread of the novel coronavirus, a detailed release of data by KSH showed. The automotive sector accounted for about 21 percent of manufacturing sector output in May. Output of the computer, electronics and optical equipment segment, which made up 13 percent of manufacturing sector output, dropped 21.2 percent in May, close to the 20.8 percent decline in April.

• Thousands working in the automotive industry to remain without work in Hungary?

STATE-OWNED RAILWAY, BUS COMPANIES MERGE

State-owned railway company MÁV took over state-owned bus company Volánbusz effective July 15 with the aim of streamlining and improving passenger services. MÁV serves about 140 million passengers a year and Volanbusz more than 400 million. Together, the companies employ over 55,000 people.

HUNGARY MONTHLY C/A DEFICIT NARROWS IN MAY

Hungary’s monthly current-account deficit narrowed to 412 million euros in May from 1.075 billion euros in April, when the trade balance was hit by spending on pandemic defense, data released by the National Bank of Hungary (NBH) showed. The balance of trade in goods showed a 181 million euro deficit in May, narrowing from a 937 million euro deficit in April.

MAGYAR EXIMBANK OPENS USD 95 M CREDIT LINE FOR HUNGARIAN-UZBEK BUSINESS PARTNERSHIPS

Minister of Foreign Affairs and Trade Peter Szijjarto announced a 95 million dollar credit line Magyar Eximbank will open to support partnerships between businesses in Hungary and Uzbekistan during an official visit to Tashkent. He said new products made by Hungarian pharmaceutical company Gedeon Richter had been included on Uzbekistan’s list of subsidised medicines.

PARLT APPROVES HOME SHARE LEGISLATION

Parliament approved legislation that defines home share accommodations, such as those advertised by Airbnb, and gives local governments the power to limit the number of days they are used each year. The legislation, which aims to crack down on tax evasion by owners of home shares as well as to reduce conflicts with neighbours, comes into force on August 1, 2020.

GOVT CANCELS AUGUST 20 NATL HOLIDAY EVENTS

Hungary’s government announced the cancellation of public events and fireworks to mark the August 20 national holiday this year because of concerns over the Covid-19 pandemic. Gergely Gulyas, the head of the Prime Minister’s Office, said the decision to call off the celebratory events was “unfortunate” but was the “best one possible” based on the recommendation of the chief medical officer and the body coordinating Hungary’s response to the pandemic.

LIDL TO BUILD EUR 100M LOGISTICS BASE IN HUNGARY

German discount chain Lidl announced plans to build a 35 billion forint (EUR 100m) logistics base on the outskirts of Budapest. The 62,000sqm logistics base in Ecser, south of the capital, near the M0 motorway, will be completed by November 2021. Hungary’s government is supporting the investment, which will create 400 jobs, with a 1.2 billion forint grant, details here.

FORMER TRUCKING MAGNATE OPENS HUF 3 BN PRIVATE CLINIC

György Wáberer, who earlier sold his road haulage business, one of the biggest in the region, opened a 3 billion forint private clinic in Budapest. The 2,500sqm Wáberer Medical Center, outfitted with a full range of imaging and laboratory diagnostic equipment, has two operating rooms and space for 15 in-patients. It has a staff of 70 physicians working in around 30 specialties.

Source: MTI