Despite of the continuing financial crisis and plummeting economic indices in Europe, the Hungarian economy showed significant growth compared to both recent years and other EU economies.

The successful decreasing of the government deficit has not stifled economic growth in Hungary, as a suitable economic policy mix has been applied. Thanks to this, the recent pick-up of the Hungarian economy has been broad-based and not limited to only a few sectors, Deputy State Secretary for the Budget Péter Benő Banai said.

GDP grew by 1.8% compared to the corresponding period of the previous year in Q3 of 2013 and both the Hungarian Government and Brussels are expecting economic growth to be about 1.5% for 2014.

The total number of people in employment reached a historic peak of 3 million 990 thousand in Q3 – in July-September 2013, 54 thousand more people were in employment compared to the corresponding period of the previous year. Wages also continued to rise; in January-August 2013, gross and net average wages within the national economy showed a year-on-year increase of 3.4% and 4.8%, respectively. In 2010-2013, the Hungarian gross minimum wage increased by 9.89%, the largest gain within the OECD. Inflation hit a record low of 0.9% in October 2013 compared to the previous year’s data.

According to the Central Statistical Office (KSH), Hungary's industrial output rose by an annual average of 4.8% in July, but reached 25% in the Southern Great Plain region for instance. The base interest rate has been gradually reduced by the Hungarian National Bank (MNB) since the end of 2011. The rate is currently 3.00%, the lowest it has ever been.

With this, the MNB aims to achieve rapidly increasing domestic consumption, a reduction in the cost of loans and to provide incentives for businesses to invest, as a lower borrowing rate means higher returns later, resulting in faster economic growth. Hungary’s external debt level is characterised by a positive trend which has been evident for almost two years: since the third quarter of 2011, the external debt of the Hungarian economy has decreased by some 18.7% of GDP.

The level of debt compared to GDP has decreased by 5.7% to 79.7% since 2010. In July 2013, the Premium Euro Hungarian Government Bond (PEMÁK) also sold exceptionally well. Investors bought 44 million euros worth of the bond, meaning there is a total of 1.7 billion euros worth of PEMÁK in investors’ hands, with only 38 thousand euros reaching maturity. According to the Central Statistical Office (KSH), July exports rose by 4.4% to 6.723 billion euros from the same period a year earlier. Imports were up 4.0% at 6.301 billion euros.

Hungarian foreign trade has registered permanent and steady surpluses since the onset of the global economic crisis as the value of Hungarian exports has repeatedly exceeded imports. Between January and November 2013, the number of tourists, the number of guest nights and tourism turnover all exceeded the record high figures of last year.

Between January-October 2013, according to the Central Statistical Office (KSH), the number of guests (7 665 949 persons) rose by 5.5 %, while the number of guest nights (20 069 652) increased by 4.4 % compared to the corresponding period of last year.

(Ministry for National Economy)