Hungary Trends – The previous week in business and finance

Budapest (MTI) – See below MTI’s main business and financial news from the previous week:

EC RESPONDS TO “STOP BRUSSELS” NATL CONSULTATION; ORBÁN RETORTS

The European Commission issued a response to “factually incorrect” or “highly misleading” claims and allegations it said were made in a national consultation with Hungarian households. The EC said claims that “Brussels is attacking our job-creating measures” and “Brussels is attacking our country because of tax cuts” were “false”. The EC said it is “massively supporting” job creation in Hungary and that it “does not interfere” in national taxation polices. Addressing the EC’s stand on the matter in the European Parliament, Prime Minister Viktor Orbán said the government fails to understand why the EC repeatedly criticises Hungary’s fostered work programme in its annual country reports. The programme is an important element of work-based, rather than welfare-based, society, he added.

HUNGARY DAIMLER PLANT OUTPUT CLIMBS TO 190,000 CARS IN 2016

Output of German carmaker Daimler’s plant in Kecskemét, in central Hungary, rose by 3.8 percent close to 190,000 vehicles last year, Mercedes-Benz Manufacturing Hungary said. Revenue of the production unit edged up to 3.4 billion euros.

FISCAL COUNCIL GIVES 2018 BUDGET BILL HIGH MARKS

The Fiscal Council said it “has no fundamental objections concerning the enforceability and the credibility of the 2018 budget bill that would warrant it signalling its disagreement” in an opinion. The Council warned that lower than expected exports could pose a downside risk to economic growth, but the main drivers of growth would remain domestic consumption, supported by higher wage growth.

ERSTE BANK HUNGARY PLANS COST-SAVING MEASURES

Austrian-owned Erste Bank Hungary chairman-CEO Radovan Jelasity said the lender plans to cut staff 7-9 percent and merge its brokerage into the parent company, thus bringing its cost-to-revenue ratio under 60 percent in 2018. The bank’s cost-to-revenue ratio is 63 percent at present, excluding the impact of the transaction duty. Erste Bank Hungary’s headcount stands at around 3,000.

ÁDÁM BALOG, TAMÁS SZEMEREY ACQUIRE STAKES IN MKB BANK

MKB Bank’s CEO, Adam Balog, and the owner of NHB Growth Credit Bank, Tamas Szemerey, acquired 9.81 percent and 20.19 percent stakes, respectively, in MKB Bank. Balog and Szemerey acquired the stakes indirectly from the investor Rakesh Kumar Aggarwal with the purchase of Graha, which owns the private equity fund Blue Robin Investments.

VISEGRAD GROUP DISMISSES EC’S CHARGES OF “SOCIAL DUMPING”

Hungary, together with the other Visegrad Group countries — the Czech Republic, Poland and Slovakia — reiterated their stand against the European Commission’s proposed revision of rules on posted workers in the European Union at a meeting of Visegrad Group labour and social affairs ministers in Warsaw. Economy Minister Mihaly Varga said the countries support EU rules addressing fraud and the circumvention of rules but reject the use of the expression “social dumping”.

HUNGARY 2016 BUDGET DEFICIT REVISED TO 1.8 PC OF GDP

Hungary’s budget deficit, calculated according to European Union accounting rules, reached 646.7 billion forints (EUR 2.1bn), or 1.8 percent of GDP, last year, revised data released by the Central Statistical Office (KSH) showed. KSH revised the deficit upward from 609.7 billion forints, or 1.7 percent of GDP, in a preliminary reading released late in March. It attributed the 37 billion forint difference to the recording of transactions related to the sale of MKB Bank.

MCS VÁGÓHÍD INAUGURATES EUR 67m SLAUGHTERHOUSE

Agribusiness MCS Vágóhíd, owned by food industry magnate Sándor Csányi, inaugurated a 21 billion forint (EUR 67m) slaughterhouse in Mohács, in southwest Hungary. The slaughterhouse will reach full capacity, processing some 900,000 hogs annually, by the end of this year.

M-FLEXILOG COMPLETES HUF 3BN PRODUCTION BASE IN BÉKÉSCSABA

M-FlexiLog, a unit of Austrian-owned printing and packaging group Marzek-Kner, has completed a 3 billion forint (EUR 10m) production base in Békéscsaba, in southeast Hungary, managing director István Kasa told MTI. The investment, which will create 120 jobs by 2020, was supported with a 922 million forint government grant.

Source: MTI