HUNGARY
A landlocked country with a large number of spa towns and hot springs
Home to Lake Balaton, the largest lake in Central Europe
Total area: 93,030 sq km (smaller than Indiana)
Population: 9.98 million
Government type: Parliamentary democracy
Administrative division: 19 counties (called „megye“), 22 urban counties (called „megyei varos“), and 1 capital city (called „fovaros“)
Capital + other major cities: Budapest (1.8 million) + (Debrecen (205,000), Miskolc (180,000), Szeged (163,000), Pecs (159,000), Gyor (129,000)
Currency: forint (HUF)
Languages: Hungarian (official) 93.6%, other or unspecified 6.4%
Ethnicity: Hungarian 92.3%, Roma 1.9%, other or unknown 5.8%
Religion: Roman Catholic 51.9%, Calvinist 15.9%, Lutheran 3%, Greek Catholic 2.6%, other Christian 1%, other or unspecified 11.1%, unaffiliated 14.5%
President: (Mr.) Pal Schmitt (since August 2010)
Prime Minister:(Mr.) Viktor Orban (since 29 May 2010)
Date of EU accession: 1 May 2004 |
 |
MACROECONOMIC OVERVIEW
Hungary's recent economic difficulties were not triggered only by the global economic crisis, but also by unreasonable fiscal policy of the previous populist left-wing government that boosted public spending which also led to misuse of social benefits, fast growing public debt and rising inflation. High taxes led to increased tax avoidance, and higher interest rates set by the national bank to fight off inflation led many companies and households in Hungary to take loans in foreign currencies. Hungary, as an open export-driven economy, was also negatively influenced by the faltering demand in its export markets, which especially hurt its key export-driven industries - consumer electronics and automotive manufacture. Fortunately, the financial crisis - state budget and economy - was brought under control by the end of 2009. The government had to implement austerity program to reduce the country's large budget deficit, which negatively affected domestic consumption.
The next two years will be a period of restructuring, and the government will introduce the simplest tax system in the region in 2011-2012.
Selected economic indicators, Hungary, 2005 - 2011
| |
|
2005 |
2006 |
2007 |
2008 |
2009 |
2010 |
2011* |
| GDP |
|
|
|
|
|
|
|
|
| Real GDP growth |
% |
4.3 |
4.1 |
1.1 |
0.8 |
-6.7 |
1.1 |
2.8 |
| GDP at current prices (1) |
€ bn |
|
|
|
106.37 |
92.94 |
98.41 |
104.51 |
| Foreign trade |
|
|
|
|
|
|
|
|
| Exports |
€ bn |
|
|
|
86.83 |
71.97 |
82.50 |
92.05 |
| Imports |
€ bn |
|
|
|
86.26 |
67.12 |
76.14 |
85.60 |
| Balance |
€ bn |
|
|
|
0.57 |
4.85 |
6.36 |
6.45 |
| Prices |
|
|
|
|
|
|
|
|
| CPI - average inflation rate |
% |
3.6 |
3.9 |
8.0 |
6.0 |
4.0 |
4.7 |
|
| Employment |
|
|
|
|
|
|
|
|
| Registered unemployment |
% |
6.1 |
7.5 |
7.4 |
7.8 |
10.0 |
11.2 |
|
| Average monthly gross wage |
€ |
638 |
571 |
617 |
663 |
|
|
|
| Exchange rates |
|
|
|
|
|
|
|
|
| HUF/USD average |
|
199 |
210 |
182 |
171 |
201 |
208 |
202 |
| HUF/EUR average |
|
248 |
264 |
251 |
251 |
280 |
274 |
273 |
Source: Hungarian Central Statistical Office, Hungarian National Bank
STRUCTURE OF ECONOMY
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KEY SECTORS
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| Source: CIA, The World Factbook, 2009 |
Source: Hungarian Central Statistical Office |
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