In Berlin, a Memorandum of Understanding on establishing a new project centre in Hungary was signed by the largest European applied research institution, the Germany-based Frauenhofer Institute for Open Communications (FOKUS), the Budapest University of Technology and Economics as well as representatives of the governments of the two countries.

In the opinion of the Minister of State, this MoU is a milestone regarding the cooperation between the Frauenhofer Institute and Hungary, as this will be the third Frauenhofer project centre in the Hungary, and that is one step more leading up to the “ultimate goal” of establishing the Hungarian Frauenhofer Institute. Nothing demonstrates the significance of this development better than the fact that the only independent research institution of the German science think-tank outside Germany is situated in Austria, Zoltán Cséfalvay said. He underlined that after settling in Hungary the most prominent body in the field of production-focused applied research in Europe may significantly contribute to the technological modernization of small and medium-sized Hungarian enterprises.

The MoU was signed at the innovation forum of the Hungarian Embassy in Berlin. At the forum organized for German politicians and business people, seven Hungarian start-ups introduced themselves and Zoltán Cséfalvay presented the plan of turning Budapest into a regional start-up capital. The “Runway Budapest 2.0.2.0.” programme was first presented in London at the end of October, and the next stops of the road show are Stockholm and Copenhagen at the beginning of next year.

At his presentation in Berlin, the Minister of State emphasised that R&D expenditures increased to 1.3 percent of GDP last year, the highest level since the regime change, which was the result of a “marked change” since 2010. There is still room to expand, he added, as this ratio within the EU is more than 1.9 percent, but even so, according to the new innovation ranking of the European Commission, Hungary is already among the “leaders” in the Central and Eastern European region and first in the EU with regard to the share of venture capital investment as percentage of GDP.

Thanks to the Jeremie programme, in 28 venture capital funds resources totalling HUF 130bn “are awaiting new ideas”, while in the coming EU fiscal period 10 percent of EU funding – some HUF 700bn – will be spent on R&D, of which some HUF 140bn will be allocated for the development of start-ups, he added. Thus access to financial resources will become significantly broader which is one of the key requirements for creating a successful “start-up eco-system”.

Speaking about detailed GDP data for the third quarter Zoltán Cséfalvay said that as a consequence of the profound changes implemented over the past years the foundation for “sound economic growth” has been laid down. Facts such as Hungary is the ninth on the ranking of most globalized economies, it is one of the best in the CEE region with regard to labour market flexibility, fiscal balance is stable with a deficit of below 3 percent of GDP or the government debt is decreasing all confirm this assumption.

The Minister of State underlined that in the second half of this year the Hungarian economy was back to a growth path, GDP growth for entire year is expected to be 1 percent and the pace of growth may accelerate to 2 percent. Zoltán Cséfalvay mentioned exports and the Funding for Growth Scheme of the National Bank of Hungary among growth factors, but he stressed that domestic consumption is also becoming a driver of growth.

(Ministry for National Economy)