In the opinion of Minister of State for Taxation and Financial Affairs Gábor Orbán, the Hungarian economy has been set on a sustainable growth path, as the structure of the economy has become sounder and positive trends appear to persist.
At a press conference Gábor Orbán said that in light of available data it appears more and more certain that Hungarian economic growth in 2013 had already reached the 0.9 percent figure predicted by former prognoses and it is likely to have even exceeded 1 percent. Recovering domestic demand, underpinned by real wage increase and subdued inflation, has been more and more instrumental in this year’s GDP growth. Investments are further facilitated by the preferential loans of the MNB’s Funding for Growth Scheme as well as the more efficient utilization of EU funds.
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Responding to a question Gábor Orbán said that for the time being the current weak exchange rate of the forint does not require a review of the budget’s headline figures, this may only happen in case the exchange rate deviates from the 310 EUR/HUF rate set in the budget for a long period of time.
As the Minister of State stressed, international institutions and analysts have recently upgraded their forecasts on the growth of the Hungarian economy, and instead of the Government’s estimate of 2 percent they are prognosticating larger expansion for 2014. Gábor Orbán emphasised that the Government at the present does not want to modify its prognosis.
He pointed out that as a result of improved foreign demand exports are expected to gain momentum this year, while import growth will also be significant. However, foreign trade and the current account will both keep generating substantial surpluses.
He added that owing to the positive economic confidence and the Government measures aimed at boosting labour market activity the private sector is expected to continue hiring this year.
TEVA Hungary Ltd CEO László Szabó stated at the press conference that the Hungarian pharmaceuticals industry has closed the gap concerning innovation and added value with the vehicle sector. He expressed hope that other sectors will also be capable of achieving a positive U-turn in Hungary.
He stressed that state incentives are crucial for the pharmaceuticals industry. The fact that producers can deduct the amount of R&D expenditures from the tax base motivates them to bring further investment projects into the country and create new jobs.
He added that Teva investment projects in Hungary thus far are valued at more than HUF 300bn. The largest investment project of the group was implemented in Gödöllő at a cost of some HUF 22bn. As a result of the development project, the company plans to produce modern oncology medicine.
László Szabó pointed out that the pharmaceuticals industry provides more than 5 percent of GDP and indirectly secures the livelihood of some 41 thousand people. Exports of the sector have increased by more than 60 percent over the past three years, while Teva exports have more than doubled in this period.
(Ministry for National Economy)
