trade

China becomes EU’s top trading partner in first 7 months

In the first seven months of 2020, China became the top trading partner of the European Union (EU), a position previously held by the United States, said Eurostat on Wednesday.

EU’s imports from China increased by 4.9 percent in the January-July period, compared to the same period last year, whereas its imports from the U.S. dropped by 11.7 percent.

The bloc’s exports to China recorded a slight drop of 1.8 percent, while those to the U.S. fell by 9.9 percent, according to the EU’s statistical office.

China and U.S. were followed by the United Kingdom, Switzerland, and Russia on EU’s main trading partner list in the first seven months.

In accordance with the world’s changing epidemiological situation during the first seven months, the EU’s international trade started to fall in January, and regained momentum after May, when confinement measures were gradually eased.

In July, EU exports out of the bloc stood at 168.5 billion euros, down by 11.3 percent compared to July 2019, and its imports from the rest of the world reached 142.6 billion euros, down by 16 percent year-on-year, according to Eurostat estimates.

Read alsoMEPs back tougher EU 2030 climate target

September 17, 2020

Foreign minister discusses economic cooperation with Laos counterpart

Hungary and Laos have agreed to launch tied aid schemes helping Hungarian companies invest some 100 million US dollars in Laos, Hungarian Foreign Minister Péter Szijjártó said after talks with his Laotian counterpart, Saleumxay Kommasith.

The investments involve building hospitals, developing Laos’s national statistical system, and digitizing postal services, Szijjártó told a joint press conference in Vientiane on Friday.

Hungary will also contribute to the training of flood protection experts in the region most often hit by floods, he said.

Hungarian companies are already playing an important role in Laotian agriculture, water management, and the development of electronic public services, Szijjártó noted.

Currently investments to the tune of 160 million dollars are under way in the country: Hungarian firms are building animal breeding farms in projects worth 35 million US dollars, modernising the capital’s sewage system with an investment of 100 million dollars and developing the population registry system for 25 million, he said.

Szijjártó said the aim was to help as many Hungarian companies as possible gain access to market opportunities in Laos. Eximbank is financing Hungarian companies’ investments in Laos, and an agreement has been signed on starting investment protection talks, he said, adding that Hungary is opening a consular office in Vientian today.

Another important link between the two countries is a bilateral scholarship agreement allowing 100 Laotian students to study in Hungary each year. It was also agreed on Friday that Hungary will welcome students from Laos for farming and environmental protection studies, he added.

Laos Hungary ORBÁN Viktor; THONGLUN, Sziszulit

Read alsoOrbán: Hungary seeks strategic partnership with Laos

September 11, 2020

EU, UK officials meet in emergency talks over controversial Brexit bill

Senior officials from the European Union (EU) and Britain met in London on Thursday for hastily arranged talks over a controversial Brexit bill as British Prime Minister Boris Johnson intended to override key parts of the Withdrawal Agreement previously agreed with Brussels.

British Cabinet Office Minister Michael Gove talked with European Commission Vice President Maros Sefcovic in an “extraordinary meeting.”

Sefcovic told Gove that violating the Withdrawal Agreement would break international law and jeopardize trade talks, according to an EU statement.

“In no uncertain terms” that the “timely and full implementation” of the divorce deal is “a legal obligation,” said the statement.

Sefcovic urged the British government to withdraw these measures that break international law from the bill “by the end of the month,” adding that the Withdrawal Agreement “contains a number of mechanisms and legal remedies to address violations of the legal obligations contained in the text, which the EU will not be shy in using.”

Issuing its own robust response, the British government said it would “discharge its treaty obligations in good faith,” but added that “in the difficult and highly exceptional circumstances in which we find ourselves, it is important to remember the fundamental principle of parliamentary sovereignty.”

Rejecting Britain’s arguments that the bill is designed to protect peace in Northern Ireland, the EU argued that “it does the opposite.”

Sefcovic said that by presenting the draft United Kingdom Internal Market Bill, the British government has damaged the EU’s trust which the UK now has to re-establish.

Britain on Wednesday published the controversial bill, which overrides elements of Johnson’s Brexit deal with Brussels, despite a senior minister explicitly acknowledging that the plan would breach international law.

The new bill will be formally debated by MPs in the British parliament for the first time on Sept. 14. It is intended to ensure Northern Ireland can continue to enjoy unfettered access to markets in the rest of Britain.

The bill was published amid the EU’s growing anger after Britain brushed aside warnings from the regional bloc that breaching the treaty would prevent any trade deal being struck. The British government has said it is prepared to walk away with no deal if progress is not made soon.

Professor Mark Elliott, public law expert at Cambridge University, described the British government’s response as “utterly risible,” and that Britain, like every other state, is required in international law to abide by its treaty obligations.

“The UK may have left the EU, but it has not left the community of nations or the rules-based international order,” said Elliott.

Britain’s membership of the EU ended Jan. 31, but as part of a transition period it is sticking with the bloc’s rules until Dec. 31.

Both sides have said a future trade deal needs to be agreed by mid-October to enable it to be approved ahead of Jan. 1, 2021. If there is no deal in place by then, Britain will trade with the EU on WTO terms.

Read alsoEU chiefs concerned about UK’s intention to breach Brexit agreement

September 11, 2020

Foreign minister discusses economic cooperation with Bangladeshi counterpart

The Hungarian minister of foreign affairs on Thursday met AK Abdul Momen, the Bangladeshi foreign minister, to discuss forging economic ties between their countries.

One of the fastest growing economies in the world, Bangladesh is offering opportunities for Hungarian businesses to enter a new market, Péter Szijjártó told MTI.

In a post-pandemic world economy, “there will be a bitter competition between countries and companies for better positions,” Szijjártó said.

Hungarian companies have a vested interest in being present in the huge market of this country with about 170 million inhabitants, while Bangladesh will benefit from the technological solutions offered, he said.

The ministers agreed to build cooperation in training and education regarding nuclear energy, Szijjártó said.

Bangladesh is currently building its first nuclear plant which is scheduled to start operations in 2024-2025, he added.

Hungary is raising the grants offered for Bangladeshi university students by 30 to 130, Szijjártó said.

Another important field of cooperation will be health-care technology, Szijjarto said, noting the work of a Hungarian team who successfully separated a pair of Bangladeshi Siamese twins conjoined at the head.

Water management will be another important area as Bangladesh is often hit by floods, and irrigation of farmlands is a key issue for the country, he said.

Szijjrtó praised Bangladesh for its role in the fight against terrorism and extremism. He called on the European Union to bolster cooperation in that area with Bangladesh. Migration waves make their way to Europe from the country occasionally, which should be thwarted, he said. The best way to do that is cooperation against terrorism and religious extremism, he said.

Bangladesh is facing a migration crisis, with large numbers of Rohingya refugees entering the country, he noted.

“We therefore share the view that everyone should be given the opportunity to make a living and live in peace and security in their own homeland,” he said.

During the visit, Szijjártó also met Prime Minister Sheikh Hasina and held talks with Minister of Commerce Tipu Munshi. He announced that Hungary would open a consular office in Dhaka.

Read alsoHungarian president honors doctors who separated head-conjoined Bangladeshi twins

September 10, 2020

Hungary-UEA cooperation getting stronger, says Minister Szijjártó in Abu Dhabi

Despite having encountered a variety of obstacles, Hungary and the United Arab Emirates have strengthened their cooperation in the recent period, Foreign Minister Péter Szijjártó said on Tuesday.

Szijjártó paid a visit to Abu Dhabi where he held talks with the foreign minister, the minister of industry and advanced technology, the minister of energy and infrastructure, the minister of state for food and water security and the minister of state for foreign trade.

Speaking to MTI about his talks, Szijjártó said trade turnover between the two countries increased by 14 percent in the first six months of the year, reaching 160 million dollars after growing by 37 percent in 2019.

Hungary and the UAE have signed several agreements that will further boost bilateral cooperation and give more Hungarian businesses the chance to enter the country’s market, Szijjártó said.

The most important agreement will see Hungarian lighting company Tungsram establish a subsidiary in Abu Dhabi and build a 4 million dollar plant with support from the Hungarian government,

the minister said. Tungsram has already been contracted by several cities in the UAE to modernise the public lighting system, he said, adding that the company’s new plant could help increase its presence on the local market.

Hungary and the UAE have also agreed to set up a joint business council with participation from companies doing business in the two countries,

Szijjártó said. Hungary’s Eximbank has opened a 725 million dollar credit line to help fund joint projects between Hungarian and UAE-based firms, he added.

Another agreement will see the resumption of cargo flights between Hungary and the UAE, with flight crews allowed entry into each other’s countries, he said.

The two countries have also agreed to take into consideration the European Union’s recommendation when signing an investment protection agreement that will ensure a secure legal environment for the companies concerned, Szijjártó said.

He also said that Hungarian oil and gas company MOL was looking to break into the UAE’s energy market with unique technology. Demand for the technology would be guaranteed, Szijjártó said, noting that the UAE was looking to increase the efficiency of the extraction of oil fields. Also, the UAE has recently discovered the world’s fourth largest gas field which it expects to start extracting soon, he added.

On another subject, Szijjártó noted that the UAE last month started up the Arab world’s first nuclear power plant, saying that Hungary’s more than 30 years of experience with nuclear power and safety would provide a sound basis for advancing energy cooperation between the two countries.

Szijjártó also highlighted the role of the UAE in the Middle East peace process, noting that the country recently agreed to normalise its diplomatic ties with Israel.

This is “very good news” for Hungary, he said, arguing that the more peaceful and stable the region was, the less likely Europe was to come under pressure from migrants fleeing the area.

Szijjártó said there was reason to hope that Israel would normalise its relations with other Arab countries in the future as well, adding that this would allow Hungary to concentrate on its economic ties with the countries of the Middle East.

Hungary “greatly appreciates” the UAE’s efforts in bringing about peace in the region and will continue to support Israel’s policies so that it could continue to normalise its relations with more and more countries in the Arab world, the minister said.

Hungarian government calls for ‘fair, balanced assessment’ of Israel

Read alsoHungary to back UAE’s election to UN Security Council

September 9, 2020

One-third of the initial plan: Budapest Airport expects 5.5 million passengers this year

Press release – Due to the flight cancelations and drop in passenger traffic expected during the remaining months of this year, Budapest Airport has recalculated its annual forecast issued 3 months ago. According to the new projection, the annual passenger number will be no more than 5.5 million, one-third of the initial plan. The drastic drop in passenger traffic is visible throughout Europe; 1.15 billion aerial passengers have vanished on the continent until the end of August, due to the travel restrictions introduced on account of the pandemic.

Following the all-time high traffic level registered last year, Budapest Airport expected another record year in 2020, with more than 17 million passengers. In contrast, the airport handled only 3.5 million passengers by the end of August, compared to 10.6 million recorded by the end of August last year. Following the low point in April, passenger numbers started to increase slowly, reaching 393 665 in August, but even this is far below the 1.6 million travelers handled last August.

The travel restrictions announced by the government and effective from 1 September are expected to have a similar impact on passenger traffic as seen between the middle of March and June.

Travel restrictions modified again! – Government allows business trips to Hungary

Wizz Air and Ryanair have already published their flight cancelations for the next months, many other airlines will decide in the next few days about the modification of their schedules and the cancelation of their flights.

Based on discussions with airline partners, we believe that flights will be canceled en masse in the coming days, and the schedule of the flights that will be available from Budapest during the current travel restrictions will be finalized by the second half of next week. Most of the remaining flights will operate to large European hubs – London, Berlin, Paris, etc. – to serve the traffic of business travelers permitted by the relevant government decree.

Based on the expected flight cancelations and reduction in passenger traffic, Budapest Airport expects around 3000 passengers per day during the coming period, instead of the 45-50 000 that was customary at this time on a daily basis.

The annual passenger number could thus be no more than 5.5 million, one-third of the initial plan.

This also means that Budapest Airport’s 2020 business plan, prepared before the coronavirus pandemic, will not be fulfilled, neither in terms of passenger traffic, nor financial indicators. Since March, the company has lost virtually all of its revenues on account of the near-complete halt in aviation seen over the past few months, which will heavily impact the 2020 financial results. It therefore introduced numerous cost-cutting measures and will for the time being spend money only if and to the extent required for the safe and secure operation of the airport. This means the sharp reduction of the number of investments, the renegotiation or termination of contracts and the reduction of all expenses not needed for the safe and secure operation of the airport, in order to responsibly preserve its existing funds for core airport operations and salaries.

Although the current crisis has drastic impacts on Budapest Airport,

thanks to the successful financial management of the past years, the company’s operation is stable; it is able to maintain the safe operation of the airport and the availability of the staff necessary for this.

September 8, 2020

Hungary – This is the reason for the oustanding profit of blood plasma trading companies

One of Hungary’s largest blood plasma trading companies – Plasma Expert Ltd. – was founded four years ago, and last year it already achieved a turnover of EUR 10.1 million (~HUF 3.6 billion), so it doubled its turnover in one year and quadrupled its profit: it showed a gain of EUR 2.3 million (~HUF 810 million). However, the actual owner is still wrapped in secrecy.

Based on the company’s report, the entire amount comes from export activities, according to which the plasma was sold abroad to a company registered in a free trade zone in the United Arab Emirates, to Golden Bay Trading FZE.

This company is the 100% owner of Plasma Expert, and this spring it was decided to take out a dividend of EUR 754 thousand (~HUF 268 million) from the profit generated so far.

Plasma Expert has not reached a profit since its inception; it was the first time it has paid dividends to its owner. As the Hungarian news portal 24.hu reports, the free trade zone of Umm el-Cayenne, less than an hour from Dubai International Airport is very appealing for foreign investors where there is no obligation to pay up share capital, and it is not even necessary to submit a report and tax return.

Furthermore, free trade zones have their own tax systems and do not tax profits. This means that the owners do not have to pay tax on the profits made with the Hungarian plasma purchased and then exported at multiple prices.

Within four years, the company had four ownerships. First, Zoltán Ládi, the founder of Plazmazóna, became known in connection with B-17 therapy, which was advertised as a panacea for cancer patients. As the Hungarian news portal 24.hu reports, based on the Opten’s company information database, last April, the ownership of Plasma Expert was given to Q-Capital Ltd., that passed the company to the Golden Bay Trading FZE registered in the Emirates at the end of May. Despite some stable points of Plasma Experts, companies registered in special status zones are not on the Emirates’ public register system, so the identity of the ultimate owner is still a mystery.

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September 5, 2020

MVM gas trader unit signs long-term gas purchase agreement with Shell

The gas trader unit of state-owned Hungarian Electricity Works (MVM) has signed a six-year agreement with Shell to purchase an annual 250 million cubic metres of liquefied natural gas (LNG) for regasification at the LNG terminal in Krk, Croatia from January 1, 2021 to October 1, 2027, Hungary’s Minister of Foreign Affairs and Trade said on Friday.

Both conditions are now met for the delivery of liquefied natural gas (LNG) from the Krk LNG terminal, Péter Szijjártó told a press conference in Budapest.

MFGK Croatia, the Croatian unit of the MVM, has recently signed a contract booking regasification capacity of some 1 billion cubic metres annually over a period of almost seven years at the Krk terminal.

The terminal is to start operating from January 2021.

Szijjártó said liquefied gas will be delivered, after regasification, to Hungary via the Hungary-Croatia gas pipeline. As a result, 10 percent of Hungary’s gas needs will be covered from the Krk LNG terminal until the end of 2027, he said.

This is Hungary’s first long-term agreement with a Western market participant, he said, adding that the agreement was signed at a competitive price.

Read alsoHungary gas supplies guaranteed for this year, says FM Szijjártó in Moscow

September 4, 2020

Dongwha Electrolyte to set up EUR 31m plant near Budapest

Dongwha Electrolyte Hungary will set up an 11 billion forint (EUR 31m) electrolyte plant in Soskut, on the outskirts of Budapest, the minister of foreign affairs and trade announced on Thursday.

The investments will create 90 jobs initially, Péter Szijjártó told a press conference.

He said big investments in battery plants locally by Samsung SDI, SK Innovation and other Korean companies had created a demand that the Dongwha group can fill.

Competition was fierce for the investment since the Dongwha Group has plants in four continents, Szijjártó said, noting that the 13,000sqm plant is Dongwha’s first in Europe.

The volume of Hungary’s trade with South Korea has increased by 16 percent to close to 2 billion dollars in the first six months of 2020 amid the pandemic with Hungary’s exports going up by 26 percent, the foreign minister said.

Lee Si-Joon, the president of Dongwha Enterprise, said their investment is poised to serve as “an important jumping board” for Hungary to become one Europe’s leading battery producers.

Read alsoChinese investors to disappear from Budapest’s real estate market?!

September 3, 2020

Hungarian foreign policy focused on economy, says minister

Hungary’s foreign policy is focused on promoting the country’s economic interests, Foreign Minister Péter Szijjártó told a meeting of Hungarian ambassadors. The aim is to draw as many investments into the country as possible in the forthcoming period, he said.

Hungary’s economy-focused foreign policy has given the country a singular competitive edge, Szijjártó said in his speech streamed live on Facebook. When it comes to “the global competition to re-distribute capacities”, Hungary can rely on a “pan-global network”, he added.

Large corporations scaled back production during the pandemic, Szijjártó noted, adding that some were likely to restructure and rationalise their operations after the crisis. He said this presented “a huge opportunity” for Hungary, which, he added, would strive to convince such companies to relocate operations here.

Szijjártó called Hungary’s foreign policy “balanced and patriotic”.

Its aim, he added, was to draw tech investments into the country from the East, not only the West. Whereas Hungary is a loyal ally of the European Union and NATO, its foreign policy “will not be limited to a narrow field”, he said.

Szijjártó called on the diplomatic corps to continue to stand up forcefully for the interests of Hungary and Hungarians. Diplomacy in international bodies should be informed by the country’s interests, he said, adding that any decisions at odds with those interests should be vetoed.

Szijjártó thanked Hungary’s diplomatic corps for their “superhuman” work to contain the coronavirus epidemic in the country. Ensuring Hungary had the equipment to overcome the crisis caused by the first wave of the epidemic was “no small feat”, Szijjártó said.

He thanked the ambassadors for their help in transporting Hungarians stranded abroad during the pandemic. The “largest repatriation movement of Hungary’s history” was organised by Hungary in cooperation with other EU countries, he said.

The government expects the same performance in the future, Szijjártó said. Measures to protect the economy follow on from protection efforts in health care, putting a different kind of pressure on diplomats, he said. That is why embassies were required to work throughout the pandemic, he said, adding that their “special responsibility” meant diplomatic employees should “work in bad times as well as good”.

Read alsoWhen will the Hungarian economy start to recover? – finance min official told

August 26, 2020

Orbán: New plan to boost Hungarian growth expected by September

The government expects to be ready with a new two-year plan to boost economic growth by mid-September, Prime Minister Viktor Orbán told public broadcaster Kossuth Radio on Friday.

In his regular weekly interview, the prime minister said he discussed economic policy measures with the relevant ministers and experts and asked them to combine their individual proposals drafted over the past several weeks to form a “logical growth plan containing dozens of measures” by mid-September.

He said he expected the two-year plan which the government will implement starting with the fourth quarter of 2020 to pass “all the necessary political and government forums” by the middle of next month.

Orbán said his government’s economic policy up until now had been focused on saving jobs. “This is not something we’ll shelve, we won’t give up on this goal,” the prime minister said.

He noted that the government had imposed a moratorium on loan repayments which had allowed hundreds of thousands of families to focus on stabilising their finances.

Businesses have also been able to retain their employees as they “broke free from the grip of banks”, Orbán said. The government also introduced job protection schemes and launched development plans aimed at job creation, he added.

The government has succeeded in saving jobs, Orbán said, arguing that employment was up compared with January. He added, however, that there was more work to be done, as employment figures were still down compared to June 2019.

He said the government had also done a good job in preparing its economic growth plan as a part of the funds earmarked for the coronavirus response measures had been used to finance future investments.

Hungarian investors will launch the projects they invested in with the help of the government’s 100 billion forint (EUR 286.3m) investment support scheme as early as next year, the prime minister added.

On another subject, Orbán said political thinking in Hungary over the past 100-150 years had been “public law-oriented” but “we had 850 years when it wasn’t like this and we could focus on deeper political questions instead of minor details related to public law.”

These, Orbán said, included questions like Hungary’s location, its size, its population compared to its neighbours, the size of the area in which the Hungarian population can live and defend, identifying who is a threat, determining whether Hungary’s neighbours should be considered threats or if Hungary could get along with them, who the closest major powers are “and whether or not they want to step on our throats, whether we can avoid conflicts or have to engage with them in the way we had to with the Turks”.

“Hungarian politics had a geopolitical dimension back then which has faded and I would like this way of thinking to make a comeback,” he said.

Orbán said central European nations now had a chance to build themselves up. Central European nations should not be thinking about how to find “protectors that are much bigger than them as they have in the past 100-150 years”, he said.

“We now have an opportunity to join forces, to try to work together, try to organise ourselves and to somehow combine that fantastic life opportunity that makes up central Europe in knowledge, spirit, energy and economic potential while preserving our sovereignty,” the prime minister said.

“This requires a command ship and that ship is Poland,” he added. Orbán said Poland with its population of around 40 million was a fast-growing country with a considerable military, “huge economic potential” and diverse interests in the region.

“If we get our own ships in the right formation and organise our forces around those of Poland and can reach an agreement with them, central Europe will be much better suited to protecting our interests, we’ll be richer and we’ll grow faster than if we looked for protectors from the outside,” he said.

Read alsoOrbán: New plan to boost Hungarian growth expected by September

August 22, 2020

Hungary has the highest inflation in the EU

Inflation in the euro area continued to rise in July, climbing to 0.4 percent from 0.3 percent measured in June, but remained lower than the annual rate of 1 percent in July 2019, figures released by Eurostat on Wednesday showed.

Meanwhile, annual inflation rate in the whole European Union (EU) stood at 0.9 percent in July, up from 0.8 percent a month ago. In June 2019, the rate stood at 1.4 percent, said the EU’s statistical office.

The lowest annual rates were registered in Greece (-2.1 percent), Cyprus (-2.0 percent) and Estonia (-1.3 percent).

The highest annual rates were recorded in Hungary (3.9 percent), Poland (3.7 percent) and the Czech Republic (3.6 percent).

The highest contribution to the inflation rate came from non-energy industrial goods and services (both +0.42 percentage points), followed by food, alcohol and tobacco (+0.38 percentage points) and energy (-0.83 percentage points).

Hungary Q2 GDP falls 13.6% on pandemic impact

Read alsoSalary report reveals a shocking gap between Budapest and Hungary’s eastern regions

August 19, 2020

Tesco in Hungary: leaving or remaining?

The CEO of the Hungarian Tesco gave an interview to napi.hu in which he talked about model change, changes in the tax system, future possibilities and downsizing. The British company sent away more than 1,000 of their employees in Hungary, and many are afraid that this is just the beginning of their departure from the Hungarian market like it happened in Poland before.

In 2019, the company’s income decreased by more than 100 billion HUF (338 million EUR). Still, Mr Zsolt Pártos, the Hungarian CEO of the company, said that the reason behind that was the downsizing of their stores and the withdrawal of those products which were not profitable enough. Tesco left Poland before, but Mr Pártos said that the Czech, Slovak and Hungarian market is different, for example, their market share is much more significant (in Hungary that is 16-17 pc). Furthermore, Tesco Polska was making a loss, but the opposite is true in the case of the other three countries of the region. Therefore, he said that by selling the Polish branch they acquired capital they can invest in the Czech Republic, Hungary and Slovakia.

According to Mr Pártos,

the Hungarian Tesco is going to remain.

Indeed, instead of leaving, they are going to invest in the Czech Republic, Slovakia and Hungary. For example, they are going to cooperate with Shell, and they already integrated new regions into their online purchase system.

Meanwhile, the Hungarian Tesco announced that they were to send away hundreds of their former employees. In the last year, Tesco sent away more than 1,000 people. Mr Pártos said that they closed non-profitable shops and ceased to sell products of the same category. However, they extended their online system and hired hundreds of people during the quarantine. He added that

they would like to have a satisfied workforce

so they train their employees at the Tesco Academy, they continuously raise their wages and offer family-friendly, flexible working hours to their colleagues.

He highlighted that they are committed to remaining in Hungary since they are expanding there. Furthermore, their services are reachable for 75pc of the Hungarians, and 80 pc of the people buy from them, which is unique in the sector, like their F&F clothes. Mr Pártos said that the months of the coronavirus epidemic were extremely difficult for them, but he is very proud of the Tesco employees.

August 19, 2020

Hungary Q2 GDP falls 13.6% on pandemic impact

Hungary’s GDP fell by an annual 13.6 percent in the second quarter, impacted by the coronavirus crisis, a first reading of data released by the Central Statistical Office (KSH) on Friday shows.

KSH said the crisis impacted services as well as industry.

Adjusted for seasonal and workday effects, GDP declined by 13.5 percent.

GDP for the first half fell an unadjusted 6.1 percent and an adjusted 5.8 percent in annual comparison.

Quarter-on-quarter, GDP slipped by an adjusted 14.5 percent.

In a statement published after the data was released, the finance ministry pointed to the unprecedented impact of the coronavirus crisis on the economic performance of European Union member states, and noted that economic contraction in Hungary was smaller than the 14.4 percent average decline for the EU in the second quarter.

It said that government measures to shield the economy from pandemic fallout and support a speedy recovery are the equivalent of about 20 percent of GDP, an “exemplary scale” in the EU.

“The goal is for the Hungarian economy to return to its pre-crisis path as soon as possible and to achieve again growth of around 5 percent next year,” the ministry said.

ING Bank chief analyst Péter Virovácz said the lender had knocked down its projection for this year’s economic contraction to 5.5-7.5 percent. Next year, the economy could grow in the 3-5 percent range, he added.

Read also2021 defence spending to reach 1.66 pc of GDP in Hungary

Senior Takarékbank analyst Gergely Suppán said the bank had lowered its forecast for the decline in GDP this year to 3.9 percent. Takarekbank sees a rebound to 7.2 percent growth in 2021, he added.

Read alsoFinance ministry sees 3 pc GDP contraction in 2020

August 14, 2020

Hungary industrial output drops by 7.8 pc in June

Output of Hungary’s industrial sector fell by an annual 7.8 percent in June, data released by the Central Statistical Office (KSH) in a second reading on Thursday show.

Adjusted for workday effects, industrial output dropped by 12.2 percent in June.

In a month-on-month comparison, industrial output rose by a seasonally- and workday-adjusted 17.1 percent in that month, KSH said.

The automotive sector accounted for more than 28 percent of manufacturing sector output in June.

Output of the computer, electronics and optical equipment segment, which made up 13 percent of manufacturing sector output, rose by 4.5 percent, after declining for two consecutive months.

Output of food, drink and tobacco companies, which accounted for 12 percent of manufacturing, increased by 1.7 percent, also after falling for two months in a row.

For the period January-June, industrial output dropped 12.8 percent year-on-year, KSH said.

Thousands working in the automotive industry to remain without work in Hungary?

Read alsoImportant: plug-in hybrid models are in production at Mercedes-Benz Hungary

August 12, 2020

Food, tobacco prices lift Hungary consumer price index by 3.8 pc in July

Higher food and tobacco prices lifted Hungary’s consumer price index by 3.8 percent year-on-year in July from 2.9 percent in the previous month, the Central Statistical Office (KSH) said on Tuesday.

Headline inflation, which was well over the National Bank of Hungary’s 3.0 percent mid-term “price stability” target, rose on a 7.8 percent increase in food prices and 6.3 percent higher spirits and tobacco prices. The price of tobacco products alone went up by 9.7 percent, because of an excise tax increase.

The price of services rose by 3.4 percent and consumer durable prices climbed 2.7 percent, the biggest increase in years.

Clothing prices increased by 0.7 percent, household energy prices inched up 0.2 percent and the price of goods in the category that includes vehicle fuel edged down 0.1 percent. Vehicle fuel prices dropped by 4.2 percent.

Core inflation, which excludes volatile fuel and food prices, was 4.5 percent, and inflation calculated using a basket of goods and services used by pensioners was 4.3 percent.

Read alsoFood, tobacco prices lift Hungary consumer price index by 3.8 pc in July

August 11, 2020

Budapest Airport welcomes the 3500th flight of Cargolux

Budapest Airport has welcomed the 3500^th flight of Cargolux at Liszt Ferenc International Airport. The Luxembourg-based airline has been ensuring connections between airports around the world, air freight operators, and Budapest Airport for 18 years now.

18 years, 3500 flights, more than 200 000 tons of air cargo of the electronics, automotive, and pharmaceutical industries, and livestock – this is Cargolux in Budapest, in a nutshell. The airline commenced its operation to and from Budapest in 2002, based on Far Eastern imports and exports from Hungary, and has maintained its operation at the airport of the Hungarian capital without interruption in the last 18 years.

The route network of Cargolux comprises, mainly, the Hong-Kong and Zhengzhou flights which fly on from Budapest to the Luxembourg base of Cargolux from where cargo can be forwarded to numerous destinations worldwide. This explains the main attraction and success of the airline, as an effective and widely accessible route network and freight capacity are crucial for the air cargo industry.

“We highly appreciate our extensive and excellent cooperation with Cargolux, and can state that this year our fruitful cooperation has come of age,” said Kam Jandu, chief commercial officer of Budapest Airport.

He added, “The last 18 years had many happy moments as well as challenges, as we experienced the effects of the economic crisis together after 2008 but also celebrated the day in 2019 when the first Cargolux jumbo was taxiing to the apron of the new BUD Cargo City. In 2020, in the fight against the coronavirus pandemic, dedicated cargo flights have become more important than ever as Cargolux offered one of the most efficient way of shipping medical equipment to Hungary.”

Read alsoChaos in Budapest Airport: hundreds of passengers waited for hours to enter Hungary

“The strategic importance of air freight is undoubtable in the case of Budapest Airport,” said József Kossuth, head of cargo. “With the BUD cargo team we are making every effort to provide an optimal environment at the airport and in the cargo community. Strategic plans can only be implemented with reliable long-term partners like Cargolux. We are convinced that our cooperation also continues to be successful going forward.”

“Cargolux is proud of this milestone that reflects our seamless collaboration with Budapest airport and its cargo community. Over the years, our collaboration has strengthened, and each party has witnessed the benefits of this partnership. We look forward to further building on this achievement and consolidating our position as the leading cargo carrier in the region”, states Domenico Ceci, EVP Sales & Marketing at Cargolux.

Read alsoChaos in Budapest Airport: hundreds of passengers waited for hours to enter Hungary

August 6, 2020

EU imports of electric and hybrid cars increase significantly in 2019

The European Union (EU)’s imports of electric and hybrid electric cars more than tripled between 2018 and 2019, showed the figures released Tuesday by Eurostat, the EU statistical office.

The imports more than doubled between 2017 and 2018 (104 percent), said the Eurostat.

Imports increased from 1.8 billion euros in January-April 2019 to 3.1 billion euros in January-April 2020.

After the pandemic hit Europe, the imports in April 2020 increased only slightly compared with April 2019.

The statistical office said the bloc exported 8.2 billion euros and imported 7.1 billion euros worth of electric and hybrid electric cars in 2019, resulting in a trade surplus of 1.1 billion euros.

The exports of electric and hybrid cars increased to 2.9 billion euros in January-April 2020 from 2.5 billion euros in January-April 2019.

April 2020 was an exception as the exports collapsed to only 0.3 billion euros, down from 0.8 billion euros in April 2019, most likely due to the effects of the COVID-19 pandemic, the Eurostat said.

Important: plug-in hybrid models are in production at Mercedes-Benz Hungary

Read alsoHungarian government to rethink EV subsidies

August 5, 2020