Hungary

Economic and political outline

Economic indicators | Foreign Trade in figures | Sources of economic information | Political outline

Economic indicators

Because of the austerity program of Prime Minister Ferenc Gyurcsany, the economy of Hungary was slow down in 2007, but due to many large investments, the GDP growth will pick up, in the 2.8-4.0 percent range in the second half of 2008. As looking at the foreign investments, Hungary enjoy the shift from low value textile and food industry to the high tech luxury vehicle producing, build up renewable energy system, and invest large amount money in the five-star tourism, large casinos in Bezenye, in North Budapest, and information technology.

GDP Indicators	2004	2005	2006	2007	2008
GDP (billions USD)	102.18	110.51	112.90	136.36e	146.76e
GDP (constant prices, annual % change)	4.8	4.2	3.9	2.1e	2.7e
GDP per capita (USD)	10,100.35	10,943.86	11,204.05	13,560.35e	14,624.70e
Inflation rate (%)	6.8	3.6	3.9	7.6e	4.5e
Unemployment rate (% of the labor force)	n.c.	7.2	7.4	7.2	n.c.
Current Account (billions USD)	-8.59	-7.47	-7.35	-7.66e	-7.45e
Current Account (in % of GDP)	-8.4	-6.8	-6.5	-5.6e	-5.1e

Source: IMF - World Economic Outlook Database; OECD

Note: (e) Estimated data

Socio-demographic indicators	2005	2006	2007
Unemployment rate (%)	7.2	7.4	7.2

Source:

Main sectors of industry

The agriculture sector used to be predominant earlier but now only represents less than 4% of the GDP and employs less than 4% of the active population. Cereals, fruits, vegetables and wine are the main crops.
Industrial sector contributes one-third to the country’s GDP and is widely open to foreign investors. Automobile and electronics are two major sectors given that they account for 30% of the country's exports and generate 15% of the GDP.
Services sector contributes 65% to the GDP.

Breakdown of economic activity by sector	Agriculture	Industry	Services
Value added (annual % change)	2.6	5.4	3.2
Value added (in % of GDP)	4.3	30.7	65.0
Employment by sector (in % of total employment)	5.0	32.4	62.6

Source: World Bank - World Development Indicators - last available data.

Monetary indicators	2002	2003	2004	2005	2006
Average annual exchange rate for 1 USD	257.89	224.31	202.75	199.58	210.39

Source: World Bank - World Development Indicators

Foreign trade in figures

Strong export growth has been sustained by a shift from European and U.S. markets to fast-growing emerging markets. However, Hungary has underperformed especially in the value of exports. The technological upgrading of exports has slowed and Hungary's share of world markets has stabilized. Germany is by far Hungary's largest economic partner (29,2%). Hungary main exports are machinery and equipment (61,1%).

Foreign trade indicators	2002	2003	2004	2005	2006
Imports of goods (millions USD)	36,911	46,221	58,695	64,041	74,017
Exports of goods (millions USD)	34,792	42,943	55,689	62,245	73,509
Imports of services (millions USD)	6,849	9,150	10,604	11,902	12,159
Exports of services (millions USD)	7,417	9,211	10,890	12,810	13,460
Imports of goods and services (annual % change)	6.6	9.3	13.5	6.8	12.6
Exports of goods and services (annual % change)	3.9	6.1	15.8	11.6	18.0
Imports of goods and services (in % of GDP)	64.9	64.6	66.7	67.8	76.5
Exports of goods and services (in % of GDP)	62.9	60.7	63.6	66.4	77.3
Trade Balance (millions USD)	-2,119	-3,279	-3,006	-1,795	-508
Trade Balance (including service) (millions USD)	-1,551	-3,217	-2,720	-887	793
Current Account (millions USD)	-4,693	-6,721	-8,561	-7,561	-6,212
Current Account (in % of GDP)	-7.0	-8.0	-8.4	-6.9	-5.5
Foreign trade (in % of GDP)	127.7	125.3	130.3	134.2	153.8

Source: World Bank - World Development Indicators

Main partner countries

Main customers (% of exports)	2006
Germany	29.5%
Italy	5.5%
Austria	4.8%
France	4.7%
United Kingdom	4.5%

Main suppliers (% of imports)	2006
Germany	27.3%
Russia	8.0%
Austria	6.3%
China	5.0%
France	4.8%

Source: 2006

Main products

Main exports (% of exports)	2006
Electrical machinery and equipment	27.0%
Machinery and mechanical appliances	23.2%
Vehicles other than railway or tramway	9.5%
Plastics	3.6%

Main imports (% of imports)	2006
Electrical machinery and equipment	23.3%
Machinery and mechanical appliances	17.0%
Vehicles other than railway or tramway	7.5%
Mineral fuels, mineral oils	7.4%

Source: 2006

To see more products: More imports (Intracen Data)
More exports (Intracen Data)

Sources of economic information

Ministries: Ministry of Agriculture and Regional Development Ministry of Economy CIA World Factbook
Statistical Office: Hungarian Statistics Office
Central Bank: Magyar Nemzetti Bank
Stock Exchange: Budapesti Értéktőzsde / Budapest Stock Exchange
Online newspapers: Népszabadság Online (only in Hungarian)
(only in Hungarian)
(only in Hungarian)
(only in Hungarian)
Search Engines: Sharelook.hu
Google
Dmoz.org
Economic portals: Napi Gazdaság - only in Hungarian
Heti Világgazdaság - only in Hungarian
Budapest Business Journal - in English
Piac és Profit - only in Hungarian

Political outline

Executive Power: Chief of state: Laszlo SOLYOM (since 5 August 2005).
Head of government: Prime Minister Ferenc GYURCSANY (since 29 September 2004).
Cabinet: Council of Ministers prime minister elected by the National Assembly on the recommendation of the president; other ministers proposed by the prime minister and appointed and relieved of their duties by the president elections: president elected by the National Assembly for a five-year term (eligible for a second term); election last held 6-7 June 2005 (next to be held by June 2010); prime minister elected by the National Assembly on the recommendation of the president; election last held 29 September 2004.
Election results: Laszlo SOLYOM elected president by a simple majority in the third round of voting, 185 to 182; Ferenc GYURCSANY elected prime minister; result of legislative vote - 197 to 12.
Legislative Power: Unicameral National Assembly or Orszaggyules (386 seats; members are elected by popular vote under a system of proportional and direct representation to serve four-year terms).
Elections: last held 9 and 23 April 2006 (next to be held in April 2010).
Main political parties: SZDSZ :Alliance of Free Democrats or SzDSz;
KDNP : Christian Democratic People's Party or KDNP;
FIDESZ :Hungarian Civic Alliance or Fidesz;
MDF : Hungarian Democratic Forum or MDF;
MSZP : Hungarian Socialist Party or MSz.
Current political leaders: President: Laszlo SOLYOM (since August 2005), non-partisan.
Prime Minister: Ferenc GYURCSANY (since September 2004, re-elected in April 2006), MSzP, heading a coalition government with partner SzDSz.
Next election dates: Presidential: June 2010
National Assembly: April 2010