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NEWS
 

GlaxoSmithKline is investing 58M EUR in vaccine plant.

The Hungarian unit of British drugmaker GlaxoSmithKline (GSK) will invest HUF 18 billion at its vaccine plant in Gödöllő, near Budapest, Minister of Foreign Affairs and Trade Péter Szijjártó said on Monday, according to Hungarian news agency MTI. The government is supporting the investment, which will create 104 jobs, with a HUF 1.8 bln grant. The plantʼs warehouse capacity will be expanded and a new unit producing pharmaceutical raw materials will be built, as a result of which the plantʼs output will triple, the minister said. Christopher Hunley, managing director of GSK Biologicals, said the activity of the unit will be expanded as a result of the development and the plant will make components of diphtheria and tetanus vaccines for a new area of utilization.

bbj.hu/business/glaxosmithkline-to-invest-huf-18-bln-in-vaccine-plant_130064

 

Audi to launch electric motor production

German carmaker Audi will start production of electric motors at its base in Hungary in two weeks, Audi Hungaria Chairman Peter Kössler said Tuesday, according to Hungarian news agency MTI. Production of parts for the Q3 model will start at the same time, Kössler said. Serial production of the Q4 model could start in 2019, he added. In future, all drivetrain technology for Audiʼs first electric vehicles will come from Hungary, Kössler revealed.

Body parts for the new models will be made in an 80,000 square-meter production hall, with the support of 700 robots, the chairman said. Tool production has been expanded, as has Audi Hungariaʼs training system, he added. Minister of Foreign Affairs and Trade Péter Szijjártó said Audiʼs HUF 10 billion investment in training 1,000 people to work the electric motor line, as well as the more than HUF 100 bln spent on the new body plant, show the companyʼs "exceptional confidence" in Hungary.

bbj.hu/business/audi-to-launch-electric-motor-production_133313

 

Hotel in Párizsi udvar set for completion in 2018

Parizs Property, a member of Mellow Mood Group, confirmed on Friday that it is building a five-star hotel for HUF 12.5 billion at the landmark Párizsi udvar in Budapest, to be finished in May 2018. The joint owner-CEOs of the Mellow Mood Group, Zuhair Awad, left, and Sameer Hamdan onsite at the Párizsi udvar. János Hermesz, project manager for the company, said the price includes the purchase price of the property, renovation of the historic building according to its original look, and construction work. Tamás Fazekas, the future manager of the hotel, said the facility will have 110 rooms, 18 suites, conference rooms and a wellness section. Mellow Mood Group signed a contract in 2015 with architectural firm Archikon on planning the renovation work. Parizs Property acquired the historic building in the city center from the District V local council for HUF 2.1 bln in 2014.

bbj.hu/real-estate/hotel-in-parizsi-udvar-set-for-completion-in-2018_133136

 

Hungary attracts 19% of retailers eyeing expansion, CBRE says

Hungary is the fifth most attractive market for retailers looking to expand their store presence in Europe, the Middle East and Africa in 2017, tied with Spain and the Netherlands, according to a CBRE research report sent to the Budapest Business Journal, entitled How Active are Retailers in EMEA? The core markets of Western Europe are top of retailers’ agenda as the most popular destinations for expanding their store networks in 2017, despite political and economic uncertainty in Europe, according to global property developer CBRE. 

The United Kingdom leads the way as the most attractive retail market in the region, with 65% of retailers targeting the country for expansion, according to CBRE’s latest report. The U.K. is followed by France (43%), Germany (38%) and the UAE (24%). Spain, the Netherlands and Hungary each attracted 19% of respondents, thus standing equal fifth among the most popular markets for retailersʼ expansion.

bbj.hu/real-estate/hungary-attracts-19-of-retailers-eyeing-expansion-cbre-says_132719

 

Hungary Eyes 9% Flat Corporate Tax

Corporate tax in Hungary will be lowered to a flat 9% as of next year, Hungary’s Prime Minister Viktor Orbán announced today at the Regional Digital Summit conference in Budapest, according to Hungarian news agency MTI.

The third quarter of the year saw prices growing in almost all segments of the market in homes, precisely in the areas where the most sales are being made: in the capital, its agglomeration, regional centers, county centers and cities with county rights, according to the analysis of Otthon Centrum.

As Otthon Centrum also expects an expansion in loans provided for home purchases, this further strengthens its forecast for the prices of homes not to drop in the foreseeable future, according to the analysis.

Furthermore, the growth in Hungary is seen as outstanding in Europe, as together with Latvia, Hungary has seen the highest price increase in the second quarter of the year, compared to the corresponding quarter a year earlier, according to Otthon Centrum. At the same time, with an average price of EUR 1,500-2,000 per square meter, Budapest is still cheaper than Warsaw, Prague, Bratislava and Zagreb, the press statement added.

By Christian Keszthelyi

Source: BBJ

http://www.xpatloop.com/news/hungary_eyes_9_flat_corporate_tax

 

Home Prices To Keep Rising In Hungary

Hungarian home prices have not been dropping lately and no such tendency is foreseen, while loans for home purchases could see an expansion, according to an analysis sent to the Budapest Business Journal today by real estate agency Otthon Centrum.

 

The prime minister was reported saying that the lowered rate would be applied to big companies, as well as to small and medium-sized enterprises (SMEs), the news agency added. 

Currently, the corporate tax rate is 10% on a tax base up to HUF 500 million, and 19% over that, MTI noted.
According to MTI, Orbán said the government made its decision on the corporate tax rate at a meeting on Wednesday, based on a proposal by Minister for National Economy Mihály Varga and decisions taken earlier on payroll taxes.

Source: BBJ

http://www.xpatloop.com/news/home_prices_to_keep_rising_in_hungary_says_otthon_centrum

 

CPI completes warehouse near Budapest airport

Real estate firm CPI has finished the construction of a 6,700 square-meter warehouse for BTS Logistics in the Airport City Logistics Park in Vecsés, near Budapest’s Liszt Ferenc International Airport, according to a press release issued today. 

The facility was built in six months only, one month ahead of plan, which CPI considers a record. Precision and innovative project management have been named by the firm as the factors leading to the fast-tracked finish. 

The facility, which is called Airport City “G”, includes 1,500 sqm of office and social space.

http://bbj.hu/real-estate/cpi-completes-warehouse-near-budapest-airport_123009

 

Váci 1, Eiffel Palace garner three European Property Awards

Horizon Development’s two redeveloped heritage buildings Váci 1 and Eiffel Palace, both designed and built by the DVM group, won three awards at the European Property Awards Gala Dinner held on Thursday at the London Marriott Hotel Grosvenor Square, according to a press release sent to the Budapest Business Journal today.

Váci 1 was awarded with the Best Mixed-use Architecture and Best Commercial Redevelopment awards. As the regional winner of the Best Commercial Redevelopment Award from Europe, the recently completed building was also nominated for the Best Global Commercial Redevelopment Award, the result of which is to be announced at the exhibition and networking summit IPAX Global in London on December 12, the press statement said. 

Eiffel Palace was awarded the title of Highly Commended in the Office Interior category at the European Property Awards, which are widely considered as the most prestigious and most widely recognized property awards throughout the region, the press statement added.

The trophies were received by the top management of Horizon Development and the DVM group (Attila Kovács, Balázs Czár, Péter Haberl and Tibor Massányi). The companies consider the awards the greatest acknowledgement of their commitment to excellence as designers, property developers and general contractors of sustainable, prime properties in Budapest, the press statement added.

Nominations were judged by an independent panel of 70 industry experts who focused on design, quality, service, innovation, originality, and the project’s commitment to sustainability. The judging panel was chaired by Lord Caithness, Lord Best, Lord Liverpool and Lord Thurso, members of the House of Lords in the U.K. Parliament. This year’s headline sponsor and media partner was The Telegraph.

http://bbj.hu/real-estate/vaci-1-eiffel-palace-garner-three-european-property-awards_124173

 

 

 

Hungarian Real Estate Market ‘Could Benefit From Brexit’ Britain’s forthcoming exit from the EU

Let's face it, everyone is talking about it. However the Hungarian Real Estate Market ‘Could Benefit From Brexit’ Britain’s forthcoming exit from the EU may have positive effects on the real estate market both in Hungary and in western Europe, the portfolio manager of OTP Bank’s Real Estate Investment Fund said in an interview published by business daily Világgazdaság. Attracted by the prospect of a 7-8% yield on investments, British investors have over the past years turned to the Hungarian real estate market with keen interest, László Kovács told the paper. The total volume of real estate transactions dropped in London by 47% to 6.7 billion euros during the first three months of the year, compared with the same period in 2015. The decline during the period was 43% for the whole of the United Kingdom, he said.

Republished with permission of Hungary Matters, MTI’s daily newsletter.

http://www.xpatloop.com/news/85363

Rents Rise To New Peak In Hungary

The cost of rented accommodation in Hungary has risen by 5-20% in the last 12 months, and by 30-40% in some regions, estate agency Otthon Centrum found in a new report. Prices rose the most in the outskirts of Budapest, but were flat in the Sixth and Seventh Districts, where rental fees had surged in preceding periods.

Rents stabilised for similar reasons in some university towns, such as Szeged, Pécs and Gyõr.

Rent prices have probably peaked, according to László Balogh of property website ingatlan.com.

University entry results will be published next week and that is generally the period when there is a rush to rent flats, Otthon Centrum adds.

Smaller flats, especially those centrally located, are snapped up quickly by tenants.

Property market experts see high demand for homes of 80-100m2, which are more economical if a number of students share the costs.

In Budapest, the average monthly rent was Ft 140,000.

http://www.xpatloop.com/news/rents_rise_to_new_peak_in_hungary

Varga: No Hurry To Adopt Euro In Hungary

25.07.2016

Hungary’s economy minister has said that there is no need to hurry to adopt the euro. Unless the level of development of the country’s economy reaches the European average, the move could be detrimental, he said. Mihály Varga said in an interview: “We can have the euro, but we won’t for the time being.”

http://www.xpatloop.com/news/varga_no_hurry_to_adopt_euro_in_hungary

 

Liszt Ferenc air cargo volume jumps 11.3% in H1

Air freight volume at Budapest’s Liszt Ferenc International Airport was up by 11.3% in the first half of the year compared to the corresponding period of 2015, operator Budapest Airport said in a press release issued last Friday

http://bbj.hu/budapest/liszt-ferenc-air-cargo-volume-jumps-113-in-h1_119710

 

S&P upgrades OTP Bank to ‘BB+’

Citing positive developments in Hungaryʼs overall banking system, S&P Global Ratings Services raised its long-term foreign and local currency counterparty credit ratings on Hungaryʼs OTP Bank and its subsidiary OTP Mortgage Bank to “BB+” from “BB”, Hungarian news agency MTI reported late yesterday.

http://bbj.hu/business/sp-upgrades-otp-bank-to-bb+_119637

 

Hungary expects EUR 30M car industry investments from China

Two automotive industry suppliers from China are bringing total investments of 30 million euros to Hungary, creating 600 new jobs, announced Hungary’s Minister of Foreign Affairs and Trade after a meeting of joint Hungarian-Chinese economic committee on Monday.

http://www.portfolio.hu/en/economy/hungary_expects_eur_30_mn_car_industry_investments_from_china.31051.html


PM ORBÁN MEETS PRESIDENT OBAMA AT WASHINGTON NUCLEAR SUMMIT

Prime Minister Viktor Orbán has been received at a White House gala given by US President Barack Obama to the leaders of delegations participating in the Washington, D. C. summit on nuclear security. Hungary was awarded the Atoms for Peace Award

http://hungarytoday.hu/news/56684


A European Hyperloop Is Being Built That Will Take You From Vienna To Budapest In 10 Minutes.

In the last few months, we’ve seen three companies in the U.S. announce plans to build Hyperloop test tracks, Elon Musk’s proposal for rapid transit vacuum tubes for people across large distances. Now, it seems Europe is getting in on the action too, with an upcoming track planned to connect three cities.

www.iflscience.com/technology/european-hyperloop-would-take-you-vienna-budapest-10-minutes


Retail sales up 6.5% in February

 BBJ Tuesday, April 5, 2016, 14:20

The volume of retail sales in Hungary increased by 6.5% in February according to raw data and by 6.4% adjusted for calendar effects compared to the same period of last year, Hungary’s Central Statistical Office (KSH) said in a first release of data published today.

bbj.hu/economy/retail-sales-up-65-in-february_114005


Magyar Telekom to install 100,000 hotspots in Hungary

Magyar Telekom, the Hungarian subsidiary of German giant Deutsche Telekom, together with Wi-Fi solution provider Fon, will launch 100,000 broadband Wi-Fi hotspots around Hungary, according to Hungarian news agency MTI today.

bbj.hu/business/magyar-telekom-to-install-100000-hotspots-in-hungary_113997

 

Hungarian real estate index reaches nine-year peak

 Anikó Fenyvesi

 Tuesday, February 9, 2016, 15:01

GKI-MGYOSZ’s Hungarian real estate market indices were up in January by an average of nearly three points, as compared to the the previous quarter, reaching the highest level since Q3 2007, according to a quarterly report published today by economic institute GKI and the organization of employers and industrialists MGYOSZ, based on a survey of the industry.

Although the outlook for the sector as a whole is upbeat, some variations have been noted in the various markets including residential, office, retail and warehouse.

The recent home subsidy program CSOK launched by the government has impacted the residential market substantially. “The number of households definitely intending to buy or build homes increased by 41%, whereas the number of those households that were inclined to do the same went up by 18% compared to last October,” the report noted.

Of the respondents surveyed, those engaged in real estate activities anticipated that real estate market conditions in rural areas would improve dramatically in the next 12 months, while the Budapest market would likely stagnate compared to the previous quarter. Given the marked improvement in the Budapest real estate market, however, this stagnation is in no way seen as unfavorable. “In the current survey the Budapest index rose by five points and the national index by ten points,” according to GKI-MGYOSZ.

With reference to the land market for building, “optimism previously registered regarding Budapest can now be seen in rural areas as well, probably as a result of the announced housing policy measures,” the report noted.

In terms of the office market, the report revealed that occupancy rates in Budapest and surrounding areas have improved. “In the fourth quarter of 2015 the average rate in Budapest (82%) almost reached its eight-year peak.” Meanwhile occupancy rates in rural areas varied between 70%-72%, according to GKI-MGYOSZ. The Budapest office market index fell by three points in January 2016, whereas the national index dropped by almost eight points. “Expectations essentially returned to their level in the fourth quarter of 2014.”

The retail market indices saw some recovery in both Budapest and rural areas, up by six points, excluding eastern Hungary where stagnation was noted, the report said.

According to GKI-MGYOSZ, the national warehouse market index increased by three points over the previous survey, while the Budapest index rose by two points.

GKI-MGYOSZ conducts quarterly surveys to assess the plans, intentions and prospects of companies engaged in real estate activities such as developers, realtors, consultants and operators, as well as households in the real estate market. Respondents of this survey included 110 real estate firms and 1,147 companies, while the household sample comprised 1,000 people, representative of gender, age, residence and education level.

 

C&W remains market leader, BP continues to improve

 BBJ

 Wednesday, February 3, 2016, 14:26

Following the merger of Cushman & Wakefield and DTZ in 2015, C&W was able to retain its market leading position in the Hungarian office market sector for the fourth consecutive year, the company said today. Last year the company successfully closed 117 transactions, a record of 89,000 sqm in lease transactions, C&W said in a press release.

According to C&W, the Budapest office market continued the momentum created in 2014 into 2015, with another record year for take-up. Tenants committed to nearly 538,000 sqm of office space, reflecting a strong, 16% gain on 2014, which was the previous record year for take-up, the company said. This increase in demand, and the lack of new supply being delivered to the market further reduced the vacancy rate to a pre-recession low of 12.1%, creating lower vacancy rates in Budapest than in Prague or Warsaw, C&W said.

“There is no doubt that 2015 surpassed everyone’s expectations in terms of take-up,” David M. Johnston, partner, Head of Office Agency said. “We expect to see the markets positive momentum continue into 2016, as occupational activity remains relatively robust, supported by very little new speculative supply being released to the market”, he added.

 

According to Johnston, simple economics could see 2016 demand continue to outstrip supply, and the vacancy rate in Budapest is foreseen to continue to fall. “As the market continues to swing in favour of landlords, tenant incentives will continue to shorten for the best space thereby increasing effective rents,” Johnston said.

 

JLL: Commercial Real Estate Market Booms In 2015

01.02.2016

 

The Hungarian commercial real estate market reached the highest volume last year, since 2007 with approximately €790 million in transactions, JLL said yesterday in a press statement.

Almost 60% of the annual volume last year was generated by portfolio transactions, which clearly reflects the increasing interest of investors for large platforms looking to gain significant exposure to the market, JLL said. Based on the latest transactional evidence, the prime office yields stand at 7% along with prime retail, while we now price prime logistics at 8.75%, it added.

Market fundamentals improved remarkably over the last year, with record breaking occupier demand, declining vacancy rates and a limited development pipeline, JLL said stating various factors supporting the market’s outstanding performance.

According to JJL, the pool of buyers deepened: The importance of Hungarian real estate funds and overseas investors increased remarkably; the presence of foreign private money remained significant, while European capital (British and Austrian investors) was also active.

Moreover, the yield spread with Western European and other leading CEE markets guarantee the attractiveness of the market.

“In our opinion, interest for Hungarian assets will increase further in 2016. Domestic buyers and overseas investors will drive most of the activity and liquidity will remain high in every asset class”, according to Benjamin Perez-Ellischewitz, Head of Capital Markets at JLL Hungary.

“Although several property portfolios were already transacted in 2015, we expect further large platforms to be sold in 2016 as well as large ticket landmark buildings. The market witnessed increasing activity on the transaction of claims and we expect the secondary debt trading to remain an essential part of the activity in 2016”, Perez-Ellischewitz added.

“It is highly anticipated that Hungary’s sovereign debt rating will be upgraded from junk level to investment grade in March 2016, which could be encouraging even for the more conservative investors for whom the strong market fundamentals and relatively high yields have not been compelling enough arguments”, according to Rita Tuza, Head of Research at JLL Hungary. The professional added that “the gap in pricing expectations between vendors and bidders narrowed and liquidity increased in every asset class along with improved debt finance terms.”

Source: BBJ.hu

 
 
Hungary 2015 Top Stories: Housing market on a rocket ride

December 28, 2015, 12:00 pm    portfolio.hu/en

 

The past year of the housing market in Hungary has been characterized by a significant increase in both turnover and prices, with the latter climbing 15% between Q1 2014 and mid-2015. This substantial upturn, however, was largely due to the used home market segment, while there was little good news to report regarding newly built homes. Although there was demand for new homes, construction projects were slow to begin. However, the big announcement mid-December on the VAT cut for newly built homes could completely upset the housing market next year, with development projects to begin again. This was the housing market in 2015. 

Late last year, it began to look certain that the rise in home prices would not be reversed, but as we were still waiting for official data, we could only talk about a housing market upturn in uncertain terms. Since then, however, it has became a certainty that the market really has got past the crisis and is now producing higher growth than previously expected. 

There are several factors behind this upswing. On the one hand, market confidence has improved significantly, and the financing environment has also benefited the property market. Low interest rates on loans also had a favorable effect on customer decisions. Investors were the first to be lured back to the market by the lower rates, and the brokerage scandals early this year gave new impetus to demand by investors. Their interest in residential property remains high and investors continue to represent the largest group of buyers; however, residential buyers are closing the gap. The jump in demand is evidenced by a significant increase in the number of transactions, passing the magic mark of 100,000 deals last year and potentially nearing 135,000-140,000 this year. 

 

 

More Than 50,000 Jobs Added In Hungary

xpatloop.com/business

 

Commenting on the jobs data, ING Bank chief analyst András Balatoni said the more than 50,000 jobs added on the primary labour market showed the spill-over effect of economic growth. Takarékbank analyst Gergely Suppan said the latest gauges of business confidence suggest employment could rise further in future. Erste analyst Gergely Ürmössy said the unemployment rate is better than earlier projected and added that the public works scheme reduced the seasonal effects in the labour market. 

 

Budapest Airport passenger traffic reached 10 million people.

xpatloop.com/business

 

Budapest’s List Ferenc Airport year to year average passenger growth exceeded 12%, which is more than double the European average and this is one of the fastest growing airports on the continent. Only last year 3 new airlines started flights into Budapest taking it to 44 airlines in total with 100 routes available to the passengers. They expect 2016 to be even better.

 

Hungary to cut VAT on homes: budget is rich and revenues will come from somewhere

December 15, 2015, 11:50 am   portfolio.hu

 

The Hungarian government expects the planned reduction of VAT on home building to spur investments, create jobs that would stimulate growth and create revenues for the budget in the long term, a state secretary at the Economy Ministry told public television on Tuesday. Parliament is expected to pass a bill today that would lower the rate of value-added tax on home building to 5% from the current 27% as of 1 January 2016.

Ágnes Hornung said building 5,000 new homes generates about HUF 100-120 billion worth of investments, i.e. this is how much the economy will grow by not to mention that the constructions will create 5,000 to 7,000 new jobs. She added that related borrowing would also spur economic growth but the cabinet has not yet taken this into consideration in its estimates.

According to a report by state newswire MTI, the state secretary urged not to focus too much on how much tax revenues would be reduced by the measure, because the central state budget is always planned with considerable surplus, and also because it is usually unknown at these types of measures where revenues would be generated.

 

Dying to find out when Hungary could be upgraded? Now you know.

December 30, 2015, 5:23 pm   portfolio.hu

 

A review of Hungary's sovereign credit rating will be on the agenda of leading rating agencies Fitch, Moody's and Standard & Poor's starting in March 2016. The analyst consensus is that the country is likely to get its investment grade rating back next year.

Based on the newly released 2016 schedules, Moody's Investor Service will be the first to take a closer look at Hungary's rating next year, with a review scheduled on 4th March. The agency is planning on two more reviews to take place on 8th July and again on 4th November. Standard & Poor's has two review dates for Hungary in its 2016 schedule: first on 18th March, then on 16th September.

 
 
US Travel Magazine: Budapest Second-Best City Of The World

The Hungarian capital Budapest has been named the world’s second-best city in the world in a top American travel magazine. Readers of Condé Nast Traveller, a luxury and lifestyle travel magazine published in New York City since 1987, have secured the city a Readers’ Choice Award for the world’s second-best city, with an overall rating of 86.090. The Italian city of Florence came first in the vote, with a lead of some 500 votes above the Hungarian capital. Vienna, in Austria, came a close third, only seventy votes behind Budapest. Among the top ten, Budapest overtook global favourites such as Sydney, Rome, Bruges, Prague, Paris or London in the vote, which was organised for the twenty-eighth time this year and saw 128 000 readers pick their favourite city.

Founded by Harold Evans in 1987, the monthly magazine is circulated in some 820 000 examples according to December 2013 and has won twenty-five National Magazine Awards.

Source: hungarytoday.hu

29.10.2015

 

Report: Rental prices in university cities grow

Rental prices in Budapest and other university cities – such as Pécs, Debrecen and Szeged – have increased by 4-33%, while Győr saw a decrease in average rental fees, research by ingatlan.com published yesterday reveals.

In the majority of university cities, rental fees have been on the rise and are expected to rise further, the announcement said.

In Budapest, in the 40-59 sqm category, average rental fees are around HUF 140,000 per month, as compared to last year’s HUF 126,000, while the 60-79 sqm category saw a rise of 4% to HUF 187,000.

 

Moody’s Changes Budapest Outlook To Positive From Stable

Ratings agency Moody’s Investors Service raised the outlook on the city of Budapest’s Ba1 issuer rating to “positive” from “stable”. Moody’s also affirmed the capital’s Ba1 rating. Moody’s noted that on Friday it had raised the outlook on Hungary’s “Ba1” sovereign long term issuer rating, one notch under investment grade, to “positive” from “stable” and said that the upgrade to the capital’s rating reflected the improving Hungarian operating environment as well as the view that “the creditworthiness of Budapest is closely linked to that of the sovereign”. 

 

Fitch: Hungary Among Most Likely Sovereigns For Investment Grade Upgrade

Hungary’s “BB+” sovereign credit rating is a single notch below investment grade and its outlook is positive and it is likely to be upgraded to investment category, Fitch Ratings said. Ever since Hungary was downgraded to speculative grade in January 2012, its credit profile has improved considerably, consistent with the current positive outlook, Fitch said. 

 

OECD: Hungary’s GDP forecast for 2016 up to 2.4%

Hungary’s GDP forecast for next year has been raised to 2.4% by the OECD in its projection published today, up from 2.2% in the previous outlook released in June, while GDP is expected to be around 3% this year and at 3.1% in 2017

 
 
 
 
 
Passenger numbers at Liszt Ferenc airport reach new record in August

 MTI – Econews

 Monday, 7 September, 2015, 09:01

Passenger numbers at Budapestʼs Liszt Ferenc International Airport reached 1,086,000 in the month of August, a new monthly record, Hungarian news agency MTI reported on Friday. 

In August, passenger numbers at the airport were up 15% compared to the same month a year earlier. Passenger numbers in January-August rose 12.7% year-on-year to 6,800,000. London, Paris and Brussels remained the most popular destinations. Last year 9,155,000 passengers used the Budapest airport.

Holiday Rentals Booming In Budapest

Guest nights at private accommodations have gone up five-fold in Budapest since 2010 in tandem with the widespread use of popular home-sharing site Airbnb, according to Central Statistics Office figures published on tourism website turizmus.com. In the first six months of this year, the number of registrations by Budapest property owners surged from 1,500 to 7,000.

Of the 26,500 hotel rooms available in the capital, one in five are operated by private individuals, most of them in the central Fifth, Sixth and Seventh Districts. One in ten guest nights in 2014 were registered in such accommodations.

Whereas the Budapest holiday rental market is booming, elsewhere the number of individuals involved in private accommodation services fell by 9% to 35,000 in five years and the number of rooms rented out by them dropped by 5% to 93,000.

Last year, some 4.5 million nights were registered at private rooms, a 37% increase from 2013.

Source: Hungary Around the Clock

Third Of Homes Sold In July In Hungary Bought As Investments

Fully 30% of home purchases in Hungary in July were made as investments, according to data compiled by a leading firms estate agent. Investors planning to rent or resell at a higher price paid, on average, 19.5 million forints for a 70sqm home. First time home buyers accounted for one quarter of the purchases. They paid, on average, 18.3 million forints for a 60sqm home. The average home price in the Pest side of the capital was 279,000 forints per square metre. Prices averaged 390,000 forints per square metre on the Buda side and 439,000 in the city centre.

Prices exclude those of homes in pre-fabricated blocks of flats erected during the communist era. It took, on average, 85 days to sell a home in Budapest that was purchased in July. It took 216 days to close sales in the west of the country.

It is estimated that 12,355 homes were sold in Hungary in July.

Source hungarymatters.hu 

Gov’t to spend HUF 7 bln on electric car infrastructure

 BBJ

 Tuesday, 8 September, 2015, 08:44

The government will divert HUF 7 bln from carbon credit sales in 2015 to infrastructure development for electric vehicles, National Economy Minister Mihály Varga said on Monday, according to state news agency MTI. 

The government will soon begin purchasing electric vehicles for its own use, Varga added. The minister renewed his promise that 150 EV charging stations would be set up in the coming months and that the ministry would submit legislative proposals to Parliament about tax incentives to lower costs associated with electric vehicles.

Currently there are 58 electric charging stations in Hungary and the government wants to shorten licensing time for installing new ones.

Report: Airbnb listings up to 8,000 in Hungary

Christian Keszthelyi

Monday, 10 August, 2015

Online accommodation rental site Airbnb has already reached 8,000 home listings in Hungary, with some 3,500 of these located in Budapest, Hungarian daily Népszabadság reported today.

Another large portion of homes listed on the site are from the Lake Balaton region, the paper added.

Rates for Airbnb rooms are about 30% cheaper than those for comparable conventional commercial accommodations.

Klára Morvay Karakas, of the catering and tourism faculty at the Budapest Business School, told the paper.

Airbnb has an estimated annual growth of 70% in Hungary, Patrick Robinson, a spokesman for Airbnb in this part of the world, said earlier to the Budapest Business Journal. 

Airbnb "cuts into the typical tourist type of travelers, who look up Airbnb and try to get a reasonable deal with someone who is willing to share their place,"  Henry Kallan, founder of the unique boutique Library Hotel in New York City and owner of three other NYC hotels, one hotel in Toronto and the Aria Hotel Prague and Budapest, earlier told the BBJ.

http://bbj.hu/business/report-airbnb-listings-up-to-8000-in-hungary_102248
Hungary could become gas distribution center
Hungary could become gas distribution center

Hungary AM

Tuesday, March 24, 2015, 8:20 AM CET

Hungary could become gas distribution center

Taking into account the countryʼs storage capacity, Hungary could become a

regional gas distribution center with its gas supplied mainly by Russia, business daily Napi Gazdaság said, citing Russian ambassador to Budapest Vladimir Nikolaevich Sergeev, Hungarian news agency MTI reported.

In an interview with the paper, Sergeev said it would serve Hungaryʼs interests to establish a regional gas distribution center as this would improve security of supply. Hungary has the fifth largest capacity in the EU, with an ability to store approximately 6 billion cubic meters of gas.

He suggested that a local distribution center could be filled for the most part with Russian gas in the foreseeable future. Sergeev noted that sanctions imposed by the EU and Russian counter-measures are the main obstacle to Hungaryʼs exports to Russia, and he expressed hope that normal trade relations can be restored as soon as possible.

http://www.bbj.hu/economy/hungary-could-become-gas-distribution-center_94702

P+P completes HUF 3 bln expansion

Hungary AM

Tuesday, March 24, 2015, 8:15 AM CET

P+P completes HUF 3 bln expansion

German-owned automotive industry supplier Poppe+Potthoff (P+P) Hungária has completed a HUF 3 bln expansion at its plant in Ajka in northwestern Hungary, managing director László Gellen told Hungarian news agency MTI yesterday.

P+P won a HUF 622 mln European Union grant for the project, which increased capacity at its plant, introduced new technology and was used to purchase production equipment. The investment also created ten new jobs in bringing headcount to 420, according to Gellen. P+P supplies parts to Daimler, BMW, Renault, Caterpillar, Delphi and Cummins.

http://www.bbj.hu/business/p+p-completes-huf-3-bln-expansion_94701

Schaeffler plans HUF 12 bln investment

Christian Keszthelyi

Friday, March 20, 2015, 1:00 PM CET

Schaeffler plans HUF 12 bln investment

The Hungarian ball bearing unit of Germanyʼs Schaeffler is planning a HUF 12 bln investment in Debrecen, in eastern Hungary, Foreign Minister Péter Szijjártó announced today.

The project is being supported with a HUF 722 mln investment, which is expected to create 72 jobs, the minister said. The company currently employs approximately 4,000 people in Hungary.

The unit, called FAG, will add production and warehouse capacity to the site as well as new equipment, Hungarian news agency MTI said.

FAG managing director Péter Szabó said the investment would raise capacity of the base to an annual 30 million units from current 20 million.

http://www.bbj.hu/business/schaeffler-plans-huf-12-bln-investment_94552

Hungary C/A Surplus Euro 546m In Jan

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Hungary C/A Surplus Euro 546m In Jan

Hungary posted a current-account surplus of 545.6 million euros in January, National Bank of Hungary monthly balance of payment data show. The country’s external financing capacity—calculated as a combined surplus of the current and capital accounts—came to a preliminary 786.8 million euros in January.

Based on the financial account, the January external financing capacity was 377.4 million.

Net transfers from the European Union reached 305.9 million euros in the first month of the year, the accrualbased figures show.

http://www.xpatloop.com/news/hungary_ca_surplus_euro_546m_in_jan

Moody’s Places OTP Ratings Under Review For Upgrade

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Moody’s Places OTP Ratings Under Review For Upgrade

Moody’s Investors Service has placed the long- and short-term local currency deposit ratings of OTP Bank and OTP Mortgage Bank under review for upgrade because of methodological changes, OTP Bank said, citing a release from the ratings agency on Tuesday.

At the same time, Moody’s withdrew the Bank Financial Strength Ratings, OTP said.

Moody’s said that the rating actions related to its new bank rating methodology affected 1,021 out of 1,934 rated banking entities.

http://www.xpatloop.com/news/moodys_places_otp_ratings_under_review_for_upgrade

Budapest a candidate city for 2028 Olympics

Christian Keszthelyi

Monday, July 7, 2014, 12:00 PM CET

Hungary is planning to apply to host the 2028 Summer Olympic Games here in Budapest, according to a report.

“Budapest can present a credible, competitive application for hosting the 2028 Olympics”, Zsolt Borkai the president of the Hungarian Olympic Committee told Hungarian business daily Napi Gazdaság today.

The deadline for submitting the bid to the International Olympic Committee is 2019, the president added. He also noted that it is a “major challenge involving the construction of several sports complexes and appropriate facilities for transferring millions of people on land, air and water.”

Borkai, who is also the mayor of Győr, said that his city would host the 2017 European Youth Olympic Festival, which  could be the “dress rehearsal” for the 2028 Olympic Games.

World Bank projects 2.4% growth in Hungary in 2014

Christian Keszthelyi Wednesday, June 11, 2014, 12:50 PM CET

The Hungarian economy will grow 2.4% in 2014 and 2.5% in 2015, according to GDP projections by the World Bank. In its latest “Global Economic Prospects” report, the Bank predicted that overall growth in Central and Eastern Europe would reach 1.7% in 2014 and 2.7% in 2015. According to the analysis, exports to the rest of Europe have contributed to the growth in the Hungarian economy. March saw an 11.5% increase of exports in the region as compared to a year earlier. And according to a June 5 report from the Hungarian government, industrial production expanded 10.1 percent in April, as compared with a year earlier. Most of this boost came from Hungarian automakers, who have been dramatically increasing production and who export much of what they produce. The World Bank report said that higher external demand has clearly helped Hungary’s recovery of domestic demand and improved conditions in the labor market. The analysis pointed out that Hungary imports Russian natural gas by way of pipelines that travel through Ukraine. If there were an interruption in that supply, and Hungary had to start buying the gas from other international sources, GDP growth would probably be curtailed to 1.4% by 2014

Magnit to build forwarding base in Hungary

Wednesday, June 11, 2014

Russian retail chain Magnit is planning to build a distribution base near Záhony in Eastern Hungary, city mayor Imre Háda told Hungarian news agency MTI. Construction of the base could start as early as this summer. The base would allow Magnit to purchase food products in the west and distribute them to the chain’s 8,000 stores in Russia. The base would operate with a fleet of 1,000 transport vehicles and would employ 1,500, according Péter Szíjjártó, the state secretary for foreign affairs and external economic relations in the Prime Minister’s Office, who released information about the plan in December. Szíjjártó touted the distribution base as the successful result of the government’s concerted policy to open Hungarian markets to the East. Magnit currently transports goods from western Europe via Belarus. MTI reported the Magnit CEO Sergey Galitsky was giving the project priority, putting plans for the construction n ear Záhony ahead of his firms plans to purchase a banana plantation in Ecuador.

Companies to hire more people for Q3

Tuesday, June 10, 2014

Staffing company Manpower’s survey revealed that companies plan to hire more people in Q3 up from Q2 and Q1's respective 15% and 11%. Altogether 750 companies were involved in the study. Six percent of the respondents said that they were planning to lay off employees in Q3 as compared to 74% who claimed to make no changes in the numbers of employees in Q3. The rest 20% of companies are planning to hire more people, which figures consitute a slight rise as compared to the beginning of the year. The gap between those planning hires and those planning layoffs was 10 percentage 

Japanese Car Parts Firm Takata to Build EUR68.3M Hungary Plant

BUDAPEST-- 14/11/2013

Japanese vehicle parts maker Takata Corp. (7312.TO) will build an airbag manufacturing factory in Hungary at a cost of EUR68.3 million, the company said Friday.

The plant, which will be built in Miskolc, a town in the northeast of the country, is planned to start production in October next year. It will employ 1,000 people and make airbags and airbag components for car manufacturers in Europe.

Takata chose Hungary for the plant because of its highly-skilled labor force and Miskolc in particular as the company wants to establish a long-term cooperation with the town's university, Stefan Stocker, Takata president and COO said at a press conference.

Takata's move is the biggest green-field investment in the country since Daimler AG (DAI.XE) premium German car maker Mercedes-Benz's construction of a manufacturing plant in Hungary in 2011, Hungarian Prime Minister Viktor Orban said at the same briefing.

Car and car parts manufacturing is a major industrial sector in Hungary and a chief driver of its export-dependent growth. In addition to Mercedes, Hungary is also home to plants of fellow car makers Audi AG (NSU.XE), the luxury arm of Volkswagen AG (VOW.XE), Suzuki Motor Corp. (7269.TO) and General Motors Co.'s (GM) German car maker, Adam Opel GmbH.

http://online.wsj.com/article/DN-CO-20131115-007896.html

National Bank of Hungary cuts key rate to 3.40%

MTI – Econews

Tuesday, October 29, 2013, 3:40 PM CET

The National Bank of Hungary's Monetary Council decided at a meeting on Tuesday to reduce the bank's key rate by 20bp to 3.40%, yet another record low, in line with expectations.

The cut was the latest in an easing cycle started a year ago in August and came amidst inflation well under the central bank's 3% mid-term target.

The cut was the latest in an easing cycle started a year ago in August and came amidst inflation well under the central bank’s 3% mid-term target.

In a statement published after the decision was announced, the Council said there was still a “significant degree” of unused capacity in the economy and inflationary pressure was likely to “remain moderate over a sustained period”. Taking these factors into consideration, as well as perceptions of risk associated with the economy, the Council said “further cautious easing of monetary conditions may follow”.

“A sustained and marked shift in perceptions of the risks associated with the Hungarian economy may influence the room for maneuver in monetary policy,” it added.

Explaining their decision on Tuesday to continue the easing cycle, the Council repeated several points they have made in previous months. These included the disinflationary impact of weak domestic demand, decisions by companies to adjust wages rather than pass higher production costs on to consumers, and the possibility that the low inflation environment could help anchor inflation expectations.

The Council reduced the base rate by 25bp every month for twelve months until August, when they started making 20bp cuts.

KSH: Unemployment rate 9.8%, lowest since Q2 2009

David Landry

Tuesday, October 29, 2013, 1:30 PM CET

New figures released by the Central Statistics Office (KSH) show that in the third quarter of 2013, the number of unemployed in Hungary was 434,000, 24,000 fewer than in the same period of 2012, the unemployment rate decreased by 0.6% year-on-year to 9.8%, making for the lowest such mark in over four years.

In the July-September period, the number of 15- to 74-year-old unemployed males was 232,000, some 18,000 fewer than a year earlier, and their unemployment rate decreased by 0.9% to 9.7%. The number of unemployed women was 202,000, and their unemployment rate was 10.0%, 0.2% lower y.o.y.

KSH statistics showed that 20.4% of the unemployed ranks belonged to the 15-24 age group and remain underrepresented in the labor market. The unemployment rate for this age group was 27.4%, 2.0% lower y.o.y. The unemployment rate of those aged 25-54, i.e. persons belonging to the “best working age” was 0.7% lower than a year ago (8.6%), while the rate for persons aged 55-64 increased by 0.5% to 7.7%.

In Hungary, 54.3% of those unemployed had been searching for a job for one year or more. The average duration of unemployment was 19.1 months.

Of the seven statistical regions, four (Central Hungary, Central Transdanubia, Western Transdanubia and Southern Transdanubia) had unemployment rates below 9%. Unemployment meanwhile increased y.o.y. in Western Transdanubia, the Northern Great Plain and the Southern Great Plain while stagnating in Central Hungary.

According to data from the National Labor Office, the total number of registered jobseekers was 484,000 at the end of September, 8.1% fewer y.o.y.

Delphi Automotive Expands Its Plant In Tatabánya, Hungary

03.10.2013

On Wednesday, automotive components manufacturer Delphi inaugurated its 8000 square meter new production hall, which will double the company’s Tatabánya unit’s production and will create a hundred new jobs. The expansion is worth HUF 3.4 billion (EUR 11.3 million) of which HUF 686 million (EUR 2.3 million) was provided from non-repayable Hungarian and EU funds. more 

Daimler committed to production in Kecskemét over long-term

MTI – Econews
Thursday, May 9, 2013, 9:20 AM CET

German automobile manufacturer Daimler is committed to long-term production at its plant in Kecskemét, Mercedes-Benz Manufacturing Hungary CEO Frank Klein said on Wednesday. Klein said that the fact that Daimler has 281 hectares of unused land available for expansion at the Kecskemét factory opened in March 2012 represents evidence of Daimler's long-term commitment to production at the plant. Daimler manufactures Mercedes-Benz B-Class and CLA-Class vehicles at the plant in Kecskemét. The company produces the latter model exclusively at the factory. Daimler employs 3,000 workers at the plant in central Hungary.


Hungary seeks closer business ties with Kuwait

MTI – Econews
Thursday, May 9, 2013, 10:05 AM CET



Hungary seeks a closer cooperation with Kuwait in the oil industry, in farming, in innovation and in air travel, state secretary for foreign affairs and external economic relations Péter Szijjártó said at a press conference in Budapest on Wednesday, winding up a two-day meeting of the Hungarian-Kuwaiti Joint Economic Committee. Khalifa Musaad Hamada, state secretary at Kuwait's finance ministry, also summed up the meeting at the press conference. Afterward, Hungary's Cytotech signed a memorandum of understanding with Kuwait's National Technology Enterprises Company.


Hungary joins the Open Government Partnership

April 26, 2013 



Hungary has joined the Open Government Partnership (OGP), an international initiative launched in September 2011 with a view to increasing transparency of government activities and fighting corruption.

France Maude, the British politician who chaired OGP’s London session, welcomed Hungary among the members of the partnership. The government, which had launched the most intensive anti-graft campaign of the past 20 years, decided to join the OGP last year and defined its commitments in an action plan. The government pledged to increase the transparency of fiscal data, public procurements, the use of public property and the spending of taxpayers’ money.

For further information see: http://goo.gl/KVy2I


HUNGARIAN GROWTH SCHEME FUNDING

Thursday 4 April 2013

The National Bank of Hungary (NBH) has on Thursday announced the launch of a Funding for Growth Scheme (FGS). Below you can read the background material published by the bank.

In Hungary, outstanding corporate loans have been declining steadily since end-2008. This is an especially unfavourable phenomenon for small and medium-sized enterprises, as they are more prone to credit supply constraints, and it is more difficult for them to find alternative financing. In the current macroeconomic environment - in line the legal provisions - the MNB, in cooperation with credit institutions, is able to implement a targeted lending scheme to support sustainable economic growth without jeopardising price stability.

The primary objective of the Funding for Growth Scheme is to improve the financing conditions for small and medium-sized enterprises through preferential central bank financing, as their situation is of primary importance in terms of preserving and expanding production capacity and employment. The preferential interest rate reduces debt service costs of borrowing companies which has a positive effect both in terms of profitability and liquidity. Lower debt service burden also results in a decrease in the deterioration of the loan portfolios, and therefore may ultimately have a positive impact on banks’ portfolio quality as well. In addition, the programme may also improve lending capacity through the balance sheet positions of banks.

As there are various government programmes available for tackling the problem of household lending and foreign currency mortgages, the Bank does not plan to develop any similar programme for households.

The Funding for Growth Scheme also comprises a reduction of the external vulnerability of the economy which, in turn, allows the reduction of interest expenditures. The provision of central bank refinancing at a preferential interest rate, which aims at the stimulation of lending to SMEs, increases the MNB’s balance sheet as well as the two-week bills outstanding on the liabilities side, and thus the interest expenditures, currently amounting to close to 1% of GDP. The accumulation of two-week bills outstanding was mainly the result of the increase in foreign currency denominated debt within government debt and of the increase in foreign exchange reserves due to the financial vulnerability of the country, which was highlighted prior to and during the crisis. At present, two-week bills constitute the largest item on the liabilities side of the MNB’s balance sheet. However, its cost - which would otherwise increase further with the cost of funds of the preferential central bank financing - can be reduced through the reduction in the country’s vulnerability.

With the involvement of credit institutions, the MNB is initiating a Funding for Growth Scheme, under which it is going to provide a limited amount of refinancing loans with a preferential interest rate for commercial banks for a temporary period. The total amount of the programme is HUF 250 billion; the interest rate on the central bank loan is 0%.

Credit institutions wishing to participate in the programme will have to lend the central bank loan at a preferential interest rate with a fixed premium to the SMEs. According to our intentions, this premium will not be higher than 2 percentage points, so the interest rate on the corporate loan may be maximum 2%. To achieve this, recourse to guarantee programmes may become necessary. Regarding this and further details of the programme, the MNB is initiating negotiations with credit institutions.

During the negotiations the Bank will also count on the cooperation of business sector participants in formulating the adequate targets of preferential loans with the objective that the preferential loans exclusively reach those small and medium-sized debtors and in those sectors that have sound business models and that would like to grow. According to our estimates, the impact of the credit crunch varies across participants in the corporate sector. Small and medium-sized enterprises are particularly affected by credit supply constraints but, at the same time, there is no real alternative to bank financing for them. An analysis of the credit supply according to industrial sectors revealed that lending conditions had become considerably tighter even in sectors that may be of key importance in terms of potential growth. By contrast, in industrial sectors struggling with permanent sales problems, signs of forced lending are seen, i.e. companies with persistently low creditworthiness seem to be kept alive artificially. All this may justify a targeted use of the preferential loan according to sectors and company sizes.

The programme will result in an increase in the MNB’s balance sheet. In the case of full utilisation, its total assets will increase by the HUF 250 billion refinancing loan, while its liabilities side will also expand with the same amount. The interest paid on the additional sterilisation holdings will constitute the MNB’s direct contribution to the lending stimulus, as an interest-free loan appears on the assets side. However, this cost is offset by other part of the programme.

Commercial banks’ would contribute to the programme in a way that instead of a premium corresponding to a risk level typical of an average SME, only the 2% premium - which is the starting point of the negotiations with the credit institutions - would be included in the lending rates. However, the income that is lost due to the lower premium may be offset by the improving solvency of debtors, which can be expected as a result of the interest burden far below the market level.

The MNB will not undertake any corporate credit risk with the loan programme. It will remain the banking sector’s task to assess and manage this risk. Accordingly, apart from targeting smaller enterprises and perhaps including sectoral preferences as well, in the allocation of funds the programme will basically rely on commercial banks’ lending decisions.

As a result of its target, size and one-off nature, the lending programme will not influence the conduct and efficiency of the interest rate policy, i.e. no 'dual interest rate’ will be created. Interest rate policy will remain prudent and predictable. The targeted nature of the programme ensures that the preferential financing will stimulate business activity and will not influence the prices of financial assets. The maximum amount of the low-interest-rate refinancing that can be provided within the programme is limited: only 4% of domestic banks’ total corporate loans and 7% of SME loans.

This form of stimulation of lending does not jeopardise price stability, maintenance of which is the primary objective of the MNB. In the present macroeconomic environment characterised by a sustained weak domestic demand, inflation may remain below the target over the longer term. The targeted stimulation of lending may contribute strengthening the growth potential by not allowing a reduction in production capacity. Considering that in the medium term the programme will affect potential output as well, the resulting medium-term inflationary pressure is negligible, thus in terms of the primary objective it does not have any material impact on interest rate policy.

Preferential central bank refinancing for converting SME foreign currency loans into forints

Also with the involvement of credit institutions, on a temporary basis, the MNB intends to provide a limited amount of preferential refinancing loans for the conversion of SME’s outstanding foreign currency loans into forints. The total amount of the programme is HUF 250 billion; the interest rate on the central bank loan is 0%. The other conditions of the programme (size of the premium and the targeted manner) are also identical with those of the previous programme point. The maximum amount of the low-interest-rate refinancing that can be provided within the programme is limited in this case as well: it does not exceed 15% of domestic banks’ total foreign currency loans to SMEs.

In addition to the difficult access to forint loans, another major problem of the SME sector is the high ratio of foreign currency loans outstanding. Nearly half of total SME loans is foreign currency denominated, amounting to HUF 1,860 billion (54% of total loans), related to 15,000 companies. Most of these loans are denominated in euro (86%), with the remaining portion being denominated in Swiss franc (14%). SMEs with Swiss franc-based loans (HUF 257 billion) presumably do not have natural or artificial hedge; therefore, these firms are exposed to a considerable exchange rate risk. The programme aiming at converting the SME foreign currency loans into forints improves the creditworthiness of the companies concerned, allowing predictable financing management for them.

In order to prevent the conversion of the foreign currency loans into forints from resulting in exchange rate volatility, the MNB is following the procedure that has already proven successful in the case of the early repayment scheme: for the currency conversion of the loans it provides foreign exchange for credit institutions from its foreign exchange reserves at market price on the condition that credit institutions undertake to use it for repaying their short-term external liabilities. As a result, the short-term foreign currency debt and foreign exchange reserves of the country decline to the same extent, i.e. Hungary’s reserve adequacy remains unchanged.

Suspension of the two-year liquidity providing loan tender

Taking account of the permanently favourable external money and capital market environment as well as banks’ persistently stable liquidity situation, the MNB is suspending the two-year secured loan tender for an indefinite period of time. In case of future money market turbulence, reactivation of this instrument will allow the effective management of liquidity shocks and ensure that a shortage of long-term liabilities would not impede corporate lending.

Reducing the vulnerability of the economy and the related interest expenditures

Together with the Government and banks, the MNB is developing a scheme, in which the reduction of the country’s short-term external debt by HUF 1,000 billion allows for bringing the foreign exchange reserves to a lower level, in line with the rules also applied before. In parallel with this, the total amount of two-week MNB bills will decline to HUF 3,600 billion, without jeopardizing the primary objective of the Bank and of financial stability.

Reserve adequacy is ensured by the fact that the use of the foreign currency reserves of the MNB reduces the external debt expiring within one year to the same extent. Using nearly one-tenth of foreign exchange reserves to reduce the source of vulnerability due to which the reserves were accumulated is in full compliance with the fundamental principles of holding central bank reserves also respected by financial markets. At the same time, gross external debt of the country would also decline during the programme.
by portfolio.hu



SRI LANKA SIGNS $47 MILLION WATER-TREATMENT LOAN WITH HUNGARY

Monday 18 February 2013

Sri Lanka signed a 35 million-euro ($47 million) loan with Hungary’s Exim bank to rehabilitate water-treatment plants that serve parts of the capital Colombo.





HUNGARY - DENTAL SUPERPOWER - SAVE UP TO 75%

14/02/2013

As Hungary continues to become a leading tourist destination for world travelers and a leading destination for dental tourism, Hungarian dental treatment experts are seeing increased dental implant business from American and European travelers to the country and the practice. The dental treatment Hungary specialists provide a variety of dental treatments with specialization in dental implants and aesthetic dentistry.

With the advance of dental science, millions now have the opportunity for optimal dental health through advanced procedures such as dental implants. Unfortunately, the costs for the highest quality procedures in countries like the U.S. and the UK can be exorbitant. In recent years, Hungary has become a major tourist destination for international travelers. Of equal interest to many of those international travelers is the fact that the country is also a primary destination for high quality advanced dental procedures at a fraction of U.S. and UK costs.

Hungarian dental experts are seeing increased dental tourism from U.S. and UK tourists seeking the superior services of the dental implants Hungary experts. U.S. and UK patients can save anywhere from two thirds on the cost of dental implants to well over half the cost for a variety of dental procedures in Budapest.

According to a recent article in the Budapest Business Journal, Hungary commands as much as 40 percent of the continent’s dental tourism business with one in five people looking for dental treatments abroad choosing Hungary. The article further states that a report from the Hungarian central tax bureau NAV shows that about 500 of the 2,600 domestic dental clinics or companies deals with a high proportion of foreign patients.





OPEL ANNOUNCES INVESTMENT IN HUNGARY

Wednesday 13 February 2013

German carmaker Opel, part of US car giant General Motors, said on Tuesday it is expanding its Hungarian plant with an engine production facility costing 120 million euros ($A157.58 million). General Motors has a strategic tie-up with deeply troubled French group PSA Peugeot Citroen.

Opel is regarded as a struggling branch of GM and is in particularly difficult talks over the future of a plant in Germany. Joachim Koschnicke, Opel's deputy president, told a joint press conference held with Hungary's prime minister Viktor Orban in Budapest that the new production facility at its Szentgotthard plant in western Hungary would be "one of the most modern in the world".

The new facility, expected to begin operating by the middle of next year, will produce a new 1.6-litre direct injection (SIDI) engines.
"It will comprise around 1600 square metres and create over 100 new jobs," Koschnicke said. Opel's total investment in Hungary now comes to about 1.4 billion euros since the company first came to Szentgotthard in 1990, he added.

In 2012, Opel produced 293,000 engines at Szentgotthard, 30 per cent more than in 2011. Koschnicke said that the new facility will house 80 new machines able to produce an extra 100,000 units per year.
by news.com





NOKIA SIEMENS NETWORKS JOINS LIST OF HUNGARY'S STRATEGIC CORPORATE PARTNERS

Tuesday 29 January 2013, 

The government on Monday signed a strategic agreement with the local unit of Finnish-German joint venture Nokia Siemens. Economy Minister Gyorgy Matolcsy, who signed the pact with Robert Esik, managing director of Nokia Siemens Networks Kft, which makes telecommunications infrastructure, said an important national goal was to double Hungary’s economic output by 2025. To achieve this, the country has to triple its export activities, he said.

The government seeks to form partnerships with companies which can contribute to its efforts to boost employment and help Hungary become a regional centre of innovation, Matolcsy said. He added that the government relies on partner companies to participate in efforts to put the economy back on a growth path, and ensure that Hungarian products and services have high value-added.

“Nokia Siemens Networks is an innovative group, and will be a strategic partner which will help make Hungary a country of innovation, give it an ability for renewal and creativity in the coming decades,” Matolcsy said.

Nokia Siemens Networks employs almost 1,000 people in Hungary. It established an R+D base in the capital in 1998.

Esik said the agreement aimed to establish a dialogue to support Nokia Siemens Networks’ long-term presence in Hungary, provide assistance for the expansion of the company’s activities in Hungary, and boost the performance and competitiveness of the Hungarian economy.

He noted that Nokia Siemens Networks had opened a financial services centre in Budapest, handling accounting for Nokia Siemens units in almost 50 countries and employing nearly 180 people. The headcount could rise by year-end, he added.

Since the summer, the government has signed strategic partnership agreements with the local units of Coca-Cola, Alcoa, Daimler, Suzuki, Hankook, General Electric, Microsoft, Stadler Rail, Tesco, IBM and Tata Consultancy Services, as well as with Hungarian drugmaker Gedeon Richter. It expects to sign about 40 such agreements.
by mti





HUNGARY 2013 - MORE THAN EUR 1.5 BILLION INVESTMENT SECURED

19-12-2012

Earlier today an agreement has been concluded between the Government of Hungary and the Wanhua Industrial Group of China envisaging that the Wanhua Group will implement long-term, strategic investment projects worth around EUR 1.6 billion in Hungary, expected to create hundreds of jobs in a backward region. Together with the acquisition of BorsodChem Ltd in 2011, the investments of Wanhua Industrial Group in Hungary are totaling at EUR 1.5 bn, including an investment project of EUR 200 million at the Kazincbarcika plant of BorsodChem. Along with the efforts of the Government these projects have ensured that BorsodChem could keep all its 3500 jobs and the enterprises related to BorsodChem’s activities could also retain 500-600 people already on their payrolls.

On the basis of the agreement signed today the Wanhua Industrial Group will bring further investments amounting EUR 1.6 bn, concentrating in the chemical industry and the energy sector, primarily in sectors related to crude oil processing, paint-, and plastics production. Initial investments will be completed as early as 2013 and will unfold in 2014.

Since its first investments the Wanhua Industrial Group has committed itself to Hungary where it found skilled labour force and excellent infrastructure in addition to a competitive business environment. For the Government of Hungary the key objective has been to preserve jobs in the Hungarian manufacturing industry and eventually to increase their number, thus strengthening the role that Hungary plays in the region.







GOVERNMENT TO EASE FINANCIAL BURDEN ON FAMILIES

13-12-2012

Government Spokesperson András Giró-Szász announced on Wednesday the Government’s decisions to increase the minimal wage as well as to decrease gas, district heating and electricity prices.
Following a meeting of a consultative body consisting of representatives of the Government, the National Association of Entrepreneurs and Employers (VOSZ) and the National Trade Unions' Association (MSZOSZ), an agreement was reached to raise the minimal wage from HUF 93,000 to HUF 98,000, and from HUF 108,000 to HUF 114,000 forints for skilled labour, from January next year. According to the calculations of trade unions, this will enhance purchasing power of families by 2.2%.

Additionally, gas, district heating and electricity prices will see a 10% decrease as of 1 January 2013. The process will be overseen by a committee including representatives of the Ministries of National Economy, National Development, Human Resources and the Prime Minister’s Office. The Spokesperson pointed out that since the sector’s privatisation in 1995, companies saw on average an annual 20% profit. On the other hand, he pointed out that between 2002 and 2010, consumer prices for gas rose by 200%, while in the case of electricity by 100%, adding that an average Hungarian household spends 30% of its income on utility bills. In Europe this number is generally under 10%.

With these measures the Government has begun to ease the financial burden on families, unprecedented in the past 20 years. Also, Parliament approved the 2013 central budget bill with 248 yes, 79 no votes and a single abstention. The budget calculates with 0.9% economic growth, envisages revenue of HUF 15,314 billion and expenditures of HUF 16,156 billion, with HUF 400 billion set aside as a precaution, determining the deficit at 2.7%. It also earmarks HUF 300 billion for job protection, promoting the employment of unskilled workers, women returning from child-care leave, and those under 25 or above 55.
by www.kormany.hu



Wizz Air sees Budapest passenger numbers climbing to 2.2 mln in 2013

MTI – Econews

Monday, December 10, 2012, 3:20 PM CET
Hungarian low-fare airline Wizz Air expects the number of passengers on its Budapest flights to climb to 2.2 million next year from 1.8 million in 2012, CEO József Váradi said at a press conference on Monday.

Wizz Air will base one more aircraft in Budapest from March, bringing the total to seven, Váradi said. Wizz Air expects total passenger numbers to rise to 13.5 million next year from 12 million in 2012.
The airline flies 250 routes to destinations in 29 countries. It has a fleet of 39 Airbus A 320 aircraft worth more than $500 million. Váradi said Wizz Air would start using Warsaw's Chopin airport, instead of the Modlin airport, from December 21.



Deloitte International Tax - Hungary 2012

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BWSP Gobert & Partners Winter Newsletter 2012

2012-12-11

This contains very important information about the latest changes in Hungarian Corporate Law and data protection areas; we hope you find it useful. Please click here to download the PDF file (843 kb)





Forint Pares Week’s Slide as Hungary’s Industrial Output Expands

By Andras Gergely - Nov 9, 2012 4:57 PM GMT+0100
The forint snapped a two-day decline after Hungary’s industrial output unexpectedly expanded for a second month in September.
The currency strengthened 0.5 percent to 283.29 per euro, paring its slide this week to 0.4 percent. Yields on the government’s benchmark 10-year bonds fell nine basis points, or 0.09 percentage point, to 6.945 percent.
Production rose a workday-adjusted 0.6 percent from a revised 1.8 percent increase in August, the statistics office in Budapest said today, citing an expansion in vehicle output. The median estimate of 12 economists in a Bloomberg survey was for a 0.5 percent drop.
“The currency gained on the better-than-expected industrial production data,” Imre Kerekgyarto, a Budapest-based trader at Commerzbank AG, wrote in an e-mail today.

Link Here



Oracle, GE Lighting strengthen operations in Hungary

By Veronika Gulyas, Dow Jones Newswires
Monday 15 October 2012
Oracle will set up Applications Lab in Hungary and boost workforce there by 10%.
U.S.-based companies GE Lighting, part of General Electric Co. and Oracle Corp. have strengthened their operations in Hungary, the companies said Friday and Monday, in line with the government's goal to boost employment.

Link Here



Government of the Republic of Hungary : Bridgestone to triple production capacity in Tatabánya

10/24/2012| 04:19am US/Eastern
Bridgestone of Japan, the world number one rubber tire producer for motor vehicles, will triple its production capacity at the Tatabánya plant by creating 505 new jobs.

Link Here



Huawei chooses DHL as its Hungarian logistics partner

Published:23 October 2012 Channel:Distribution
Huawei, which supplies telecoms equipment, has chosen DHL Supply Chain to provide logistics services in Hungary.

DHL supplies Huawei’s European Supply Centres in Pécs (SW Hungary) and Komárom (NW Hungary) with raw materials required for the production of wireless, mobile transmission and telecommunications devices. Services include packaging, customs services, road transport and ocean freight forwarding of the products

Link Here





- Hungary ranks 31st on WIPO global innovation list By MTI ECONEWS
Hungary has been placed 31st in the latest global innovation list compiled by the World Intellectual Property Organisation (WIPO). From among the Visegrad countries, Hungary only trails 27th-placed Czech Republic on the 141-nation list while Slovakia was ranked 40th and Poland 44th

http://www.realdeal.hu/20120705/hungary-ranks-31st-on-wipo-global-innovation-list/



- Hungary trade surplus reaches €701 mln in May
Hungary's trade surplus for January-May was €2.827 billion, narrowing from €3.252 billion in the same period a year earlier.

http://www.bbj.hu/economy/hungary-trade-surplus-reaches-eur701-mln-in-may-_63634


- Hungary Tops Best To Invest List For CEE
"Hungary beat Poland and Czech Republic in the fourth annual Site Selection Best to Invest rankings of nations and metro areas for investment-attraction activity in 2011. The national Investment Promotion Agencies recognized here were particularly successful in 2010 at attracting capital investment projects — both expansions of existing facilities and new projects — from investors at home and abroad. Hungary comes in as the top E European country for inward investment by this prestigious and influential report."

http://www.siteselection.com/issues/2012/may/cover.cfm



Swiss investment group to invest HUF 1 bln in Est Media MTI
– Econews Tuesday, March 13, 2012, 8:20 PM CET Swiss investment group Global Emerging Markets Limited (GEM) will invest HUF 1 billion into Hungarian listed media company Est Media over the next three years and will be authorized to subscribe 3 million Est Media shares within five years at an issue price of HUF 280 per share, Est Media said on Tuesday.

Link Here



Knorr-Bremse investing HUF 5 bln in Kecskemét MTI

– Econews Tuesday, March 6, 2012, 1:20 PM CET Knorr-Bremse Fékrendszerek, the Hungarian unit of German braking systems maker Knorr-Bremse is building a more than HUF 5 billion production hall and development laboratory in Kecskemét, the company announced on Tuesday. Knorr-Bremse won HUF 1.2 billion in European Union support in the framework of the New Széchenyi Plan for the project. The investment will create 110 jobs.

Link Here



36 Hours in Budapest
LIKE much of post-Communist Europe, Budapest has replaced the image of the impoverished East with symbols of international luxury, like the Four Seasons Hotel Gresham Palace and a new branch of Nobu, the high-end Japanese restaurant. But unlike many other cities in the region, the Hungarian capital’s brightest spots are often native-born, rather than imports.

- Article from the New York Times Click Here

Business sector employment rises yr/yr for third month in a row
Friday 17:39, September 17th, 2010
The number of business sector employees in Hungary rose 2.8% yr/yr to 1,852,900 in July after a 2.2% rise in June and steady year-on-year drops between December 2008 and April 2010, figures published by the Central Statistical Office (KSH) show.

​Link Here


Foreign investors buy net HUF 126 bln forint government securities in January
February 4th, 2010
Non-resident or foreign investors were net buyers of Hungarian forint-denominated government securities in January, increasing their holdings by HUF 126 billion, or around €540 million, to HUF 2,218 billion at the end of the month,
Staff of 700 to work for Hungarian EU presidency
February 4th, 2010
Hungary will employ a staff of 700 to work under the Hungarian EU presidency in the first half of 2011, mainly civil servants already dealing with EU affairs, the Foreign Ministry told MTI.
Hungary To Overshoot Deficit Goal In 2010 - GKI
February 4th, 2010

"Hungary’s economy will be around stagnation status in 2010, with the general government deficit likely to come in around 4-5% of GDP, depending on the next government economic policy, according to the latest forecast of think tank GKI prepared in co-operation with Erste Bank. The current technocrat government projects a budget deficit of 3.8% of GDP in 2010.


Magyar Telekom wins international investor relations award
July 10th, 2009
he international Investor Relations Magazine (IR Magazine) has given Magyar Telekom the award for Best Investor Relations by a Hungarian Company and Krisztina Förhécz, head of Magyar Telekom's Investor Relations Department, the 2009 award for Best Investor Relations Officer in a Hungarian Company.
Magyar Telekom wins international investor relations award
July 10th, 2009
he international Investor Relations Magazine (IR Magazine) has given Magyar Telekom the award for Best Investor Relations by a Hungarian Company and Krisztina Förhécz, head of Magyar Telekom's Investor Relations Department, the 2009 award for Best Investor Relations Officer in a Hungarian Company.
Second wave of tax reforms passed July 8th, 2009
The second package of tax reforms, due to come into effect on 1 January, was passed by Parliament last Monday, which the government hopes will stimulate the economy and increase participation in the labour market .
Indotek plans residential-commercial complex in Budapest July 9th, 2009
Indotek, a property developer established by the US-based Bohemian Group of Companies and other private capital and venture capital investors, plans to build a HUF 49.5 billion residential and commercial complex in Budapest's District XV over the next ten years, Indotek told MTI.
Cash-strapped council may unload building to get hard cash
July 6th, 2009
According to the left-leaning daily Népszava, the council of Budapest’s District’s V is planning to sell the Párizsi courtyard and other valuable properties to offset the HUF 500 million (EUR 1.84 million) debt of the district. Népszava says that building most likely will be renovated and open as a luxury hotel. Several hotel projects in Budapest are on hold due to the financial crisis.

EC sees Hungary economy contracting 1.6p% in 2009
January 19th, 2009
Hungary’s economy is likely to contract 1.6% in 2009 and expand about 1% in 2010, the European Commission forecast on Monday.
Hungary Needs To Learn Lesson From 2008 Forint Story January 6, 2009
"If we were to write a brief summary of what happened to the Hungarian currency in 2008, the job would be relatively easy: Early in the year, abandoning the trading band seemed to open the path for the exchange rate to become a powerful tool in fighting inflation.
Inflation Eases To 5.1% In Oct From 5.7% in Sept
November 11, 2008
"Hungary's consumer prices rose 0.2% month on month and 5.1% year on year in October 2008, undershooting the 5.2-5.3% yr/yr consensus in a Portfolio.hu poll.
Daimler AG, Hungary ink deal to stop speculations
October 29,2008
Germany-based premium car manufacturer Daimler AG. signed an agreement with Hungary's government on Monday (Oct 27), to invest approximately EUR800 million ($1bn) in a new plant near Hungarian Kecskemét town (60 km south of Budapest), that will manufacture more than 100,000 compact cars annually from 2012, and create up to 2,500 direct jobs, indirectly employing up to 10,000 people.
Record activity on the industrial property market
August 13, 2008
As the industrial market of Budapest, and surrounding areas, has been rapidly evolving in recent years, property consultant CB Richard Ellis divided Budapest and its surrounding industrial locations graphically into three separated submarkets, the quarterly market view report of the company, published last Friday (August 8) states.
Regional bank growth slows but still strong
June 23,2008
The banking market in the Central Eastern European region remains dominated by foreign international players, who continue to profit from their investments in the region, says CEE Banking Study 2008, a report prepared by UniCredit Group economists.
DTZ reports 'best year' in Hungary
July 23, 2008
Preliminary results for DTZ Holdings Plc for the year ended Apr 30 2008 showed increased revenue through ongoing diversification and globalization, with the Hungarian division reporting a record year, the company said.
Despite Forecasts, Hungarian Currency Buoyant Again
July 30, 2008
Coupled with very low trading volume, the Hungarian forint is making a slow advance in the forex market this morning.
Hungary says Economy Near Turning Point after Austerity Package
June 2,2008
With the budget deficit likely to come in above target this year,  Finance Minister Janos Veres said on May 29 that the Hungarian economy is approaching a turning point.
Magyar Suzuki claims 'great' year
May 28, 2008
Despite the "severe market situation in the Hungarian car industry," Magyar Suzuki Corporation (MSC) closed the 2007 financial year with a "great" performance, the company said Friday, May 23.
MPs Pass Anti-Segregation Schools Bill
, 2008
Parliament yesterday passed a bill designed to reduce segregation in schools. It requires all local authorities that operate schools to draw up an equal opportunity plan against segregation. Those schools that do not draft such a plan will be barred from bidding for EU funds.
Power plant investment kicks off in NE Hungary
2008
The cornerstone of the 233.2 megawatt capacity, gas-fueled, combined cycle power plant to be built in Vásárosnamény (northeast Hungary) was set on Sunday
Former Rynart depot rebranded
April 8, 2008
Much of the Hungarian logistics market was shocked by the demise of Rynart, one of its largest operators, in October last year.
Orbán wants early elections
April 8, 2008
According to opposition leader Viktor Orbán, "the only solution left [for Hungary] is to hold early elections," the opposition leader told Fidesz's 20th anniversary party on Sunday (Mar 30).
Property investors need to know where to look
March 21, 2008
It seems to be impossible to switch on the television or open a newspaper without reading gloomy stories about the knock-on effect of the US sub-prime mortgage crisis and the resulting global credit crunch. But its not all bad news for the Budapest market.

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