Hungarian economy minister highlights need to bolster SMEs

National Economy Minister Márton Nagy stressed the need to strengthen Hungarian-owned SMEs at an event organised by the Hungarian Chamber of Commerce and Industry (MKIK) on Monday, his ministry told MTI.

Hungarian economy minister talks about strengthening Hungarian-owned SMEs

In a presentation, National Economy Minster Márton Nagy said the value of cooperation and partnership had appreciated amid the crises faced by the global economy, adding that the MKIK was an important partner of the government that could signal businesses’ needs.

A strong business sector is a prerequisite for a strong economy and convergence, which is why every effort must be made to boost the competitiveness of SMEs, he said.

Acknowledging the impact of the war in Ukraine and weak external demand because of the faltering Germany economy, he said there was a need to be “more resilient and more creative” and called for a new economic policy. That policy requires thinking that is “4-5 steps ahead” and “targeted use of resources” concentrated on Hungarian-owned SMEs, he added.

He said a new state secretariat would be established soon within the National Economy Ministry dedicated to SMEs. He added that domestic demand, the source of much SME revenue, needed to be boosted, too.

The government will establish favourable financing conditions in the framework of a targeted action plan, while continuing to ensure interest support through the Széchenyi Card Programme, and launch a new capital scheme, the economy minister said.

SMEs also need a targeted programme offering investment subsidies based on one-off government decisions, like the scheme for big companies, he added.

The action plan being drafted places stress on SME digitalisation, without which staying competitive is “unimaginable”, he said. Every business needs their own website and an email, the economy minister added.

He said local businesses in commerce needed to start competing with foreign webshops as those were taking away a big chunk of Hungarians’ consumption.

Addressing wage policy, he said the minimum wage needed to be raised to 50pc of the average wage gradually. He added that businesses could manage that increase and it wouldn’t put SMEs at risk.

The Hungarian economy minister said the government was working on a package of measures targeting families with children, including bigger tax preferences and a new home purchase programme. He added that Hungarians needed to be given the option of saving a certain amount every year, tax free, to use for home purchases for themselves or their children.

He put next year’s GDP growth at 3-5pc and said the contribution of locally-owned SMEs to that expansion needed to increase.

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