Speaking at a Budapest conference entitled Hungarian Exports Set to Renew, Minister for National Economy Mihály Varga said that one of the primary objectives of Hungarian foreign economic policy is to assist domestic SMEs to gain ground on international markets to a larger extent than before.

The Minister added that several measures will help achieve this goal this year and over the coming years: the sphere of the New Széchenyi Programme’s financial schemes was extended, the allotment of development funding under the Jeremie Programme was accelerated and the amount of preferential loans paid increased from HUF 37bn at the end of 2010 to HUF 149bn by the end of February 2013. In addition, the Government raised the capital of Eximbank’s guarantee fund from HUF 320bn in autumn 2012 to HUF 1200bn.

The Minister for National Economy stressed that in 2012 the volume of Hungary’s exports and imports totalled EUR 80bn and more than EUR 73bn, respectively, thus the country posted a trade surplus of some EUR 6.7bn, and this year’s data are signalling further improvement.

The composition of Hungarian exports is modern, as the majority of exported goods are products of high added value, but a significant share of outbound trade is conducted by large multinational companies owned by foreigners, therefore the export potential of domestic SMEs must be improved.

Mihály Varga called it also crucial to empower SMEs both as suppliers on the domestic market and exporters on external ones. In this aspect, the fact that Eximbank is now in the position of extending the scope of its activities regarding domestic suppliers and participate in the financing of export-oriented investment has increased the bank’s financing options.

As the Minister said, in order to provide enterprises with adequate financing, enterprises are already in the position of obtaining preferential loans totalling as much as EUR 100 million through the three elements of the Széchenyi Card, via the current account and the accounts for current assets and investment. Mihály Varga added that the Government provides subsidies for interest and guarantee fees as well as indemnities.

He said that that the Funding for Growth Scheme launched by the new management of the National Bank of Hungary assists SMEs to obtain financing through credit institutions, and it is another factor expected to help these businesses gain ground on external markets.

The Minister for National Economy reminded the audience that the policy of “opening to the East” is a key foreign policy objective – parallel to pursuing the policy of “keeping with the West”. “What we aim for is the substantial increasing of exports to countries of great growth potential while maintaining or even improving positions we have secured in the European Union,” he explained.

Among key foreign economic objectives, the Minister singled out the strengthening of economic cooperation in the Carpathian Basin and the reinforcing of economic relations with countries of the Western Balkan. He emphasised that the establishment of the Carpathian Region Business Network – with the aim of opening 11 representative offices in six neighbouring countries -- is one step in this direction.

Mihály Varga also said that the Ministry for National Economy currently has a network of foreign trade diplomats at 63 locations in 50 countries.

(Ministry for National Economy)