Hungary investment volume down 9.6 pc in Q1
Budapest, May 30 (MTI) – Investment volume in Hungary fell by an annual 9.6 percent in the first quarter of 2016, the Central Statistical Office (KSH) said on Monday.
Investment volume fell after growing by 7 percent in the fourth quarter of 2015.
Investment contraction was mainly due to the winding up of developments financed from European Union resources, which affected investments by central budget organisations to a larger extent, KSH said. In areas less affected by this such as machinery investments, and in certain sectors such as manufacturing, the decline was more moderate, KSH added.
Manufacturing sector investment volume was down by 3.6 percent from a year earlier.
Investments in the manufacturing sector this way came to 271.1 billion forints (EUR 862.9m) in the first quarter.
For all sectors combined, in absolute terms, investments added up to 754.2 billion forints at current prices.
Logistics investments decreased by 41.2 percent, coming to 70.4 billion forints and farm investments fell 9.7 percent and reached 43.7 billion forints.
Construction investments fell 19.2 percent to 281.9 billion forints and investments in machinery, equipment and vehicles were down by 3.0 percent at 457.2 billion forints.
In 2015, investment volume growth was 0.6 percent. In absolute terms, investments came to 5.582 trillion forints.
Analysts interviewed by MTI said the investment contraction did not come as a surprise but said the extent of the decline exceeded expectations.
Chief analyst of K and H Bank Dávid Németh noted that these were the weakest investment data of the past four years. He said it was unfavourable that investment volume fell almost 5 percent in the business sector. The question is whether this is a one-off decline in business-sector investments or if it will turn into a long-term trend, he added.
Gergely Suppán of Takarékbank said investments could grow again in the near future with the establishment of new automotive capacities, which is supported by several business surveys. Housing investments could contribute substantially to investment growth next year, he added. Suppán predicted ever slower decline in the remaining part of the year and investment growth of up to 5 percent or slightly more next year.
Source: http://mtva.hu/hu/hungary-matters
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