Hungary Economy - 2006

Economy - overview:
Hungary has made the transition from a centrally planned to a market economy, with a per capita income one-half that of the Big Four European nations. Hungary continues to demonstrate strong economic growth and acceded to the EU in May 2004. The private sector accounts for over 80% of GDP. Foreign ownership of and investment in Hungarian firms are widespread, with cumulative foreign direct investment totaling more than $60 billion since 1989. Hungarian sovereign debt was upgraded in 2000 and together with the Czech Republic holds the highest rating among the Central European transition economies; however, ratings agencies have expressed concerns over Hungary's unsustainable budget and current account deficits. Inflation has declined from 14% in 1998 to 3.7% in 2005. Unemployment has persisted around the 6% level, but Hungary's labor force participation rate of 57% is one of the lowest in the Organization for Economic Cooperation and Development (OECD). Germany is by far Hungary's largest economic partner. Policy challenges include cutting the public sector deficit to 3% of GDP by 2008, from about 6.5% in 2005, and orchestrating an orderly interest rate reduction without sparking capital outflows.

GDP (purchasing power parity):
$161 billion (2005 est.)

GDP (official exchange rate):
$104.5 billion (2005 est.)

GDP - real growth rate:
3.9% (2005 est.)

GDP - per capita (PPP):
$16,100 (2005 est.)

GDP - composition by sector:
agriculture: 3.9%
industry: 30.9%
services: 65.3% (2005 est.)

Labor force:
4.18 million (2005 est.)

Labor force - by occupation:
agriculture: 6.2%
industry: 27.1%
services: 66.7% (2002)

Unemployment rate:
7.1% (2005 est.)

Population below poverty line:
8.6% (1993 est.)

Household income or consumption by percentage share:
lowest 10%: 4.1%
highest 10%: 20.5% (1998)

Distribution of family income - Gini index:
24.4 (1999)

Inflation rate (consumer prices):
3.7% (2005 est.)

Investment (gross fixed):
23.1% of GDP (2005 est.)

Budget:
revenues: $51.4 billion
expenditures: $58.34 billion; including capital expenditures of $NA (2005 est.)

Public debt:
60.9% of GDP (2005 est.)

Agriculture - products:
wheat, corn, sunflower seed, potatoes, sugar beets; pigs, cattle, poultry, dairy products

Industries:
mining, metallurgy, construction materials, processed foods, textiles, chemicals (especially pharmaceuticals), motor vehicles

Industrial production growth rate:
7.5% (2005 est.)

Electricity - production:
32.21 billion kWh (2003)

Electricity - consumption:
36.96 billion kWh (2003)

Electricity - exports:
7.1 billion kWh (2003)

Electricity - imports:
14.1 billion kWh (2003)

Oil - production:
43,920 bbl/day (2003 est.)

Oil - consumption:
134,100 bbl/day (2003 est.)

Oil - exports:
47,180 bbl/day (2001)

Oil - imports:
136,600 bbl/day (2001)

Oil - proved reserves:
110.7 million bbl (1 January 2002)

Natural gas - production:
2.94 billion cu m (2003 est.)

Natural gas - consumption:
14.58 billion cu m (2003 est.)

Natural gas - exports:
4 million cu m (2001 est.)

Natural gas - imports:
9.587 billion cu m (2001 est.)

Natural gas - proved reserves:
34.26 billion cu m (1 January 2002)

Current account balance:
-$8.667 billion (2005 est.)

Exports:
$61.75 billion f.o.b. (2005 est.)

Exports - commodities:
machinery and equipment 61.1%, other manufactures 28.7%, food products 6.5%, raw materials 2%, fuels and electricity 1.6% (2003)

Exports - partners:
Germany 31.4%, Austria 6.8%, France 5.7%, Italy 5.6%, UK 5.1% (2004)

Imports:
$64.83 billion f.o.b. (2005 est.)

Imports - commodities:
machinery and equipment 51.6%, other manufactures 35.7%, fuels and electricity 7.7%, food products 3.1%, raw materials 2.0% (2003)

Imports - partners:
Germany 29.2%, Austria 8.3%, Russia 5.7%, Italy 5.5%, Netherlands 4.9%, China 4.8%, France 4.7% (2004)

Reserves of foreign exchange and gold:
$18.49 billion (2005 est.)

Debt - external:
$76.23 billion (30 June 2005 est.)

Economic aid - recipient:
$4.2 billion in available EU structural adjustment and cohesion funds (2004-06)

Currency (code):
forint (HUF)

Exchange rates:
forints per US dollar - 199.58 (2005), 202.75 (2004), 224.31 (2003), 257.89 (2002), 286.49 (2001)