Minister Nagy: Europe slow at adapting to new trends

Márton Nagy, the minister of economic development, addressed the World Economic Forum in Davos on Friday and discussed new economic trends, the dynamism of change to new industries and the need for adaptability, the ministry said in a statement.

Nagy said Europe was slow at adapting to new trends while significant structural changes were taking place in the world. Asian countries, especially China, had responded well to the global challenges of recent times and strengthened their economies, but the EU, by seeking a return to Maastricht criteria, could significantly harm its growth and the competitiveness of member states, he said.

He said Hungary had learnt that economic growth and peace hinged on international relations based on mutual respect. Hungary’s goal, he added, was to maximise the advantages of its good geographical position and become a meeting point for Eastern and Western economies and technologies.

Nagy praised the achievements of the Hungarian prime minister’s policy of opening to the East, noting that Hungary had managed to increase the proportion of direct investments from the East from 10 percent in 2010 to 34 percent today.

The government strategy, he said, was beneficial for the national economy, with exports expected to rise to 100 percent of GDP by 2030, while FDI was projected to double from the current 100 billion euros, Nagy said.

Additionally, the multiplier effect of FDI was also beneficial, he said, because through horizontal and vertical integration it enhanced research and development activities in cooperation with universities, while strengthening Hungarian businesses by linking them to supply chains in increasingly value-added positions, he said.

Also, the big expansion of logistics opportunities was expected to result in the sector expanding from 5 percent to 10 percent of GDP by 2030, he added.

He said Hungary was pursuing its own strategy and aimed to be a bridgehead between East and West. The development of the vehicle industry was a good example, he said, with German carmakers like Audi establishing links with Chinese battery makers such as CATL in Hungary, he added. Also, Chinese electric carmaker BYD is launching its first European production in Hungary, he said.

Nagy said Hungary was making every effort to enhance competitiveness, and he argued that the EU should also take urgent steps to strengthen new industries and competitiveness instead of seeking a return to the fiscal and financial criteria of 30 years ago.

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