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PROFILE: Hungary

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Tips for Doing Business in Hungary

 

  • Business culture is formal and polite.

  • Dress conservatively.

  • Personal relationships are important.

  • Hungarians are a proud people.

  • They place great importance on innovation and knowledge-based technologies.

  • It's important to be a trustworthy partner.

  • Face-to-face meetings are appreciated.

  • Avoid sensitive subjects like religion and politics.

  • They have hierarchical organizational business structures.

  • Small talk expected before meetings.

  • Hungarians are expressive.

  • Older generations normally do not speak English and German.

  • Avoid using the word "no".

  • Do not offer direct criticism.

  • People don't toast or raise glasses in Hungary.  (After the Austrians quashed the Hungarian Revolution in 1848, they celebrated their success extensively by toasting.)

 

Brief History

  • 1000 - Became a Christian kingdom

  • 1867- Became member of Austro-Hungarian Empire

  • 1945 -Became a communist country and part of the Warsaw Pact, which was controlled by the Soviet Union

  • 1956 - Revolted by announcing withdrawal from the Warsaw Pact. The revolt was put down by the Soviet Union. Many Hungarians died.

  • 1968 - Began liberalizing their economy

  • 1990 - Separated from the Soviet Bloc and initiated a free market economy

  • 1999 - Joined NATO

  • 2004 - Joined EU

 

Location

In Central Europe bordering on Austria, Croatia, Romania, Serbia, Slovakia,  Slovenia and Ukraine

 

General Information

  • Capital City: Budapest

  • Literacy Rate: 99.1%

  • Size: About the same size as Indiana

  • Population: 9.7M (2022 est.)

  • Population Growth: 0.3% (2022 est.) 

  • Population Distribution: Fairly even distribution throughout most of the country.  Urban population is 72.6%

  • Government Type: Parliamentary Republic

 

Economy:

The country was transitioned from a central planned economy to a more market driven economy. However, in recent years, the government has become involved to boost household consumption.

  • Besides a diverse agricultural sector, they have strong and diverse manufacturing and service bases.

  • Transportation equipment, mining, metallurgy, construction materials, processed foods, textiles, chemicals (especially pharmaceutical) are all very strong. The US is the largest investor in the country. Over 1600 companies have ties to the US.

  • Unemployment Rate: 3.8% (March 2022)

  • Currency Exchange Rate: 1 US Dollar = 357.40 Hungarian Forint (May 23 2022)

  • GDP: $302 B (2020 est.)

  • GDP Growth Rate: 4.58% (2019)

  • Labor Force: 4.4M  (2020 est.)

  • Labor Force Breakdown: Agriculture - 4.9%, Industry - 30.3%, Services - 64.5% (2015 est.)

  • Major Industries:  Automotive (115,000 employed), electronics, pharmaceuticals, medical technology, IT, communications technology, food

 

International Trade

Total Product Exports (2020):  $120.3B

 

Major Product Exports (2020): Electrical machinery/equipment - $29.5B; Machinery, including computers - $19.2B; Vehicles - $17.9B; Pharmaceuticals - $7.5B; Plastics, plastic articles - $4.5B; Optical, technical, medical apparatus - $3.6B; Mineral fuels including oil - $3.1B; Rubber, rubber articles - $2.4B; Cereals - $1.8B; Furniture, bedding, lighting, signs, prefab buildings - $1.7B

 

Major Product Export Partners: Germany – 2.8%, Slovakia – 5.4%, Romania – 5.3%, Italy – 5.2%, Austria – 4.5%, France – 4.2$; Poland – 4.1%; Czech Republic – 4.1%; Netherlands – 3.5%; UK – 3.1%; Spain – 2.8%; US – 2.7%.  

 

Total Product Imports (2020): $110B

Vehicle Parts - $5.7B, Cars - $4.05B, Packaged Medicines - $3.19B, Integrated Circuits - $3B, Broadcasting Equipment - $2.67B.

 

Major Import Partners (2020): Germany - $26.9B, China - $8.48B, Poland - $6.63B, Czechia - $6.13B, Austria - $6.06B

English Language Online Publications

 

Sampling of Companies

  • E.ON Hungaria - large public relations firm- www.eon.hu – Budapest

  • GE Hungary - healthcare, renewable energy, aviation, power generation technology etc. - www.ge.com/europe/content/ge-hungary - Veresegyhaz and Budapest

  • Granit-Polus Group - large financial advisory firm - www.granitpolus.com – Budapest

  • Bonafarm Group – Conglomerate - crop production, feed production, livestock, meat processing, dairy products, game management - www.bonafarmcsoport.hu/en - Budapest

  • Videoton Holding - manufacturing, consulting, logistics, warehousing, property management etc. (Note: conducts significant contract manufacturing)

 

National Holidays (2022)

  • January 1 - New Year’s Day

  • March 15 - 1848 Revolution Memorial Day

  • April 15 - Good Friday

  • April 17 - Easter Monday

  • May 1 - Labor Day/May Day

  • June 5 - Whit Sunday

  • June 6 - Whit Monday

  • June 21 - June Solstice

  • August 20 - National Day

  • October 21 - 1956 Revolution Memorial Day

  • December 24 - Christmas

  • December 25 - Christmas Day

  • December 28 - Boxing Day

 

By: Paul Mastilak

InterMark3, Inc.