Is the southern opening the key to African markets?
According to fuhu.hu, the southern opening seems to be working, even if Africa’s share in the total Hungarian trade is small and it is characterised by significant fluctuations. Two Hungarian institutions, the Hungarian National Trading House and the Hungarian Trade & Cultural Centre set the goal to improve our African trade.
The import mostly features processed goods and food, while the export seems to be dominated by engineering products.
The trade with Africa is characterised by a great export surplus, while the continent’s share in the whole trade is still small (an import worth 16.5 thousand billion forints [~ EUR 52 billion] and an export worth 18 thousand billion [~EUR 57 billion] between January and July).
Besides the countries that play an important role in traditional fields and tourism, there are several states that are not in the limelight in Hungary. Out of the „dark” countries, Hungarian diplomacy (and trade) is present in five. For that matter, this is the part of the continent everyone wants to trade with; where China spends a lot of money on different investments.
The last time South Africa was featured in Hungarian news was when a local company’s interest, the New Europe Property Investments (NEPI) Rockcastle bought the Arena Plaza mall.
The 84 billion forint (~EUR 270m) purchase price is obviously not included in the statistics, which recorded an import worth 7.7 billion (~EUR 24m) and an export worth 61 billion (~EUR 196m) last year. Until this July, the import grew to its sesquialter, while the export showed a slight fallback.
The changing of the traffic is significant, even though based on the current evaluation of the Ministry of Foreign Affairs and Trade, the southernmost African country’s competitiveness declined drastically due to the eroded institutions and the financial system. Moreover, bad public safety, corruption, political instability and the very high unemployment rate still count as great issues. The South African economy is currently improving, but the expectations are not quite reassuring.
The other great trade partner is Ghana, but it’s hard to manage the one-sided goods relation. Based on last year’s statistics, they had an import worth 25 million forints (~EUR 80,200) and an export worth 13.5 billion (~EUR 43.3m). This year’s rates are much better, the country is constantly developing.
Similarly, Nigeria is part of the “billionaires club” regarding import.
Hungary bought products worth 31 million forints (~EUR 99,550) last year, and 8 million (~EUR 25,690) so far this year. Meanwhile, the Hungarian export reached 9.9 (~EUR 31.7m) and 6.1 billion (~EUR 19.6m).
The Angolan trade traffic shows a very interesting pattern. There was basically no Hungarian import from the country last year, while the onetime Portuguese colony bought products worth 1.5 billion forints (~EUR 4.8m) from us. But both of the rates increased in the first part of this year: we had an import worth 6 million forints (~EUR 19,270) and an export worth 23 billion (~EUR73.8m). The same tendency characterises Nigeria.
Ethiopia, hit by war and terrorism, sold us products for 310 million (~EUR 995,450) and bought products for 6.3 billion (~EUR 20.2m) last year. This year, Hungary spent 136 million forints (~EUR 436,720) on Ethiopian products and sold them goods for 753 million (~EUR 2.4m) so far.
Kenya used to be the most developed African country regarding infrastructure. It is currently somewhat underrated in the Hungarian trade with a 400 million (~EUR 1.2m in 2016) and 87.5 million (~EUR 280,980 until July 2017) import and a 5 billion (~EUR 16m) and 1.2 billion (~EUR 3.8m) export.
Hungary usually sells machines, means of transportation and other processed goods to these countries, and buys raw materials, agricultural products and processed goods.
Two Hungarian institutions, the Hungarian National Trading House and the Hungarian Trade & Cultural Centre, are winning more and more positions on the continent the whole world wants to exploit. This is an achievement to be proud of.