Hungary Economy 2018, CIA World Factbook
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Hungary Economy 2018

SOURCE: 2018 CIA WORLD FACTBOOK AND OTHER SOURCES











Hungary Economy 2018
SOURCE: 2018 CIA WORLD FACTBOOK AND OTHER SOURCES


Page last updated on February 28, 2018

Economy - overview:
Hungary has transitioned from a centrally planned to a market-driven economy with a per capita income approximately two-thirds of the EU-28 average; however, in recent years the government has become more involved in managing the economy. Budapest has implemented unorthodox economic policies to boost household consumption and has relied on EU-funded development projects to generate growth.The economy is largely driven by exports, making it vulnerable to external market shocks. Following the fall of communism in 1990, Hungary experienced a drop-off in exports and financial assistance from the former Soviet Union. Hungary embarked on a series of economic reforms, including privatization of state-owned enterprises and reduction of social spending programs, to shift from a centrally planned to a market-driven economy, and to reorient its economy towards trade with the West. These efforts helped to spur growth, attract investment, and reduce Hungary’s debt burden and fiscal deficits. However, living conditions for the average Hungarian initially deteriorated as inflation increased and unemployment reached double digits. Conditions slowly improved over the 1990s as the reforms came to fruition and export growth accelerated. Economic policies instituted during that decade helped position Hungary to join the European Union in 2004; Hungary has yet to join the euro-zone, however. Hungary suffered a historic economic contraction as a result of the global economic slowdown in 2008-09 as export demand and domestic consumption dropped, prompting it to take an IMF-EU financial assistance package.Since 2010, the government has backpedaled on reforms and taken a more nationalist and populist approach towards economic management. The government has favored national industries, and specifically government-linked businesses, through legislation, regulation, and public procurements. In 2010 and 2012, the government increased taxes on foreign-dominated sectors, such as banking and retail, because the move helped to raise revenues and decrease the budget deficit, thereby allowing Hungary to maintain access to EU development funds. The policy deterred private investment, however. In 2011 and 2014, Hungary nationalized private pension funds. The move squeezed financial service providers out of the system, but it also helped Hungary curb its public debt and lower its budget deficit to below 3% of GDP, as subsequent pension contributions have been channeled into the state-managed pension fund. Hungary’s public debt (at 73.9% of GDP) is still high compared to EU peers in Central Europe. Despite these reversals, real GDP growth has remained robust in the past several years because EU funding increased, EU demand for Hungarian exports rose, and domestic household consumption rebounded. To further boost household consumption ahead of an anticipated 2018 election, the government has announced plans to increase the minimum wage and public sector salaries, decrease taxes on foodstuffs and services, cut the personal income tax from 16% to 15%, and introduce a uniform 9% business tax for small and medium-sized enterprises and large companies. Real GDP growth slowed in 2016 due to a cyclical decrease in EU funding, but increased to 3.8% in 2017, in part as Budapest front-loaded drawdowns of EU funds ahead of the planned 2018 election.Systemic economic challenges include pervasive corruption, long-term and youth unemployment, skilled labor shortages, widespread poverty in rural areas, vulnerabilities to changes in demand for exports, and a heavy reliance on Russian energy imports.

GDP (purchasing power parity):
$283.6 billion (2017 est.) $274.8 billion (2016 est.) $269.5 billion (2015 est.)
note: data are in 2017 dollars
country comparison to the world: 61

GDP (official exchange rate):
$132 billion (2016 est.)
[see also: GDP (official exchange rate) country ranks ]

GDP - real growth rate:
3.2% (2017 est.) 2% (2016 est.) 3.1% (2015 est.)
country comparison to the world: 106
[see also: GDP - real growth rate country ranks ]

GDP - per capita:
$28,900 (2017 est.) $28,000 (2016 est.) $27,300 (2015 est.)
note: data are in 2017 dollars
country comparison to the world: 69

Gross national saving:
24.4% of GDP (2017 est.) 24.5% of GDP (2016 est.) 25.1% of GDP (2015 est.)
country comparison to the world: 57
[see also: Gross national saving country ranks ]

GDP - composition, by end use:
household consumption: 52.3%
[see also: GDP - composition, by end use - household consumption country ranks ]
government consumption: 19.9%
[see also: GDP - composition, by end use - government consumption country ranks ]
investment in fixed capital: 19%
[see also: GDP - composition, by end use - investment in fixed capital country ranks ]
investment in inventories: -1.2%
[see also: GDP - composition, by end use - investment in inventories country ranks ]
exports of goods and services: 94.1%
[see also: GDP - composition, by end use - exports of goods and services country ranks ]
imports of goods and services: -84.1% (2017 est.)
[see also: GDP - composition, by end use - imports of goods and services country ranks ]

GDP - composition, by sector of origin:
agriculture: 4.4%
[see also: GDP - composition, by sector of origin - agriculture country ranks ]
industry: 30.9%
[see also: GDP - composition, by sector of origin - industry country ranks ]
services: 64.7% (2017 est.)
[see also: GDP - composition, by sector of origin - services country ranks ]

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:
5.5% (2017 est.)
country comparison to the world: 37
[see also: Industrial production growth rate country ranks ]

Labor force:
4.599 million (2017 est.)
country comparison to the world: 88
[see also: Labor force country ranks ]

Labor force - by occupation:
agriculture: 4.9%
[see also: Labor force - by occupation - agriculture country ranks ]
industry: 30.3%
[see also: Labor force - by occupation - industry country ranks ]
services: 64.5% (2015 est.)
[see also: Labor force - by occupation - services country ranks ]

Unemployment rate:
4.4% (2017 est.) 5.1% (2016 est.)
country comparison to the world: 59
[see also: Unemployment rate country ranks ]

Population below poverty line:
14.9% (2015 est.)
[see also: Population below poverty line country ranks ]

Household income or consumption by percentage share:
lowest 10%: 3.3%
[see also: Household income or consumption by percentage share - lowest 10% country ranks ]
highest 10%: 22.4% (2015)

Distribution of family income - Gini index:
28.2 (2015 est.) 28.6 (2014)
country comparison to the world: 133
[see also: Distribution of family income - Gini index country ranks ]

Budget:
revenues: $63.63 billion
[see also: Budget - revenues country ranks ]
expenditures: $66.96 billion (2017 est.)
[see also: Budget - expenditures country ranks ]

Taxes and other revenues:
48.2% of GDP (2017 est.)
country comparison to the world: 19
[see also: Taxes and other revenues country ranks ]

Budget surplus (+) or deficit (-):
-2.5% of GDP
note: Hungary has been under the EU Excessive Deficit Procedure since it joined the EU in 2004; in March 2012 the EU elevated its Excessive Deficit Procedure against Hungary and proposed freezing 30% of the country's Cohesion Funds because 2011 deficit reductions were not achieved in a sustainable manner; in June 2012, the EU lifted the freeze, recognizing that steps had been taken to reduce the deficit; the Hungarian deficit increased above 3% both in 2013 and in 2014 due to sluggish growth and the government's fiscal tightening (2017 est.)
country comparison to the world: 100
[see also: Budget surplus (+) or deficit (-) country ranks ]

Public debt:
73.9% of GDP (2017 est.) 74.1% of GDP (2016 est.)
note: general government gross debt is defined in the Maastricht Treaty as consolidated general government gross debt at nominal value, outstanding at the end of the year in the following categories of government liabilities: currency and deposits, securities other than shares excluding financial derivatives, and government, state government, local government, and social security funds.
country comparison to the world: 47
[see also: Public debt country ranks ]

Fiscal year:
calendar year

Inflation rate (consumer prices):
2.5% (2017 est.) 0.4% (2016 est.)
country comparison to the world: 114
[see also: Inflation rate (consumer prices) country ranks ]

Central bank discount rate:
0.9% (31 December 2016) 1.35% (31 December 2015)
country comparison to the world: 129
[see also: Central bank discount rate country ranks ]

Commercial bank prime lending rate:
1.6% (31 December 2017 est.) 2.09% (31 December 2016 est.)
country comparison to the world: 182
[see also: Commercial bank prime lending rate country ranks ]

Stock of narrow money:
$68.36 billion (31 December 2017 est.) $55.64 billion (31 December 2016 est.)
country comparison to the world: 47
[see also: Stock of narrow money country ranks ]

Stock of broad money:
$80.77 billion (31 December 2017 est.) $69.25 billion (31 December 2016 est.)
country comparison to the world: 59
[see also: Stock of broad money country ranks ]

Stock of domestic credit:
$77.36 billion (31 December 2017 est.) $70.11 billion (31 December 2016 est.)
country comparison to the world: 60
[see also: Stock of domestic credit country ranks ]

Market value of publicly traded shares:
$21.59 billion (31 December 2016 est.) $17.69 billion (31 December 2015 est.) $14.51 billion (31 December 2014 est.)
country comparison to the world: 64
[see also: Market value of publicly traded shares country ranks ]

Current account balance:
$6.339 billion (2017 est.) $6.797 billion (2016 est.)
country comparison to the world: 26
[see also: Current account balance country ranks ]

Exports:
$98.72 billion (2017 est.) $91.6 billion (2016 est.)
country comparison to the world: 37
[see also: Exports country ranks ]

Exports - commodities:
machinery and equipment 53.4%, other manufactures 31.2%, food products 8.4%, raw materials 3.4%, fuels and electricity 3.9% (2012 est.)

Exports - partners:
Germany 28.2%, Romania 5.2%, Slovakia 5%, Austria 4.9%, France 4.8%, Italy 4.8%, Czech Republic 4.2%, Poland 4.2% (2016)

Imports:
$93.28 billion (2017 est.) $85.78 billion (2016 est.)
country comparison to the world: 36
[see also: Imports country ranks ]

Imports - commodities:
machinery and equipment 45.4%, other manufactures 34.3%, fuels and electricity 12.6%, food products 5.3%, raw materials 2.5% (2012)

Imports - partners:
Germany 26.3%, Austria 6.4%, China 6.3%, Poland 5.5%, Slovakia 5.3%, Netherlands 4.9%, Czech Republic 4.9%, France 4.8%, Italy 4.8% (2016)

Reserves of foreign exchange and gold:
$27.02 billion (31 December 2017 est.) $25.82 billion (31 December 2016 est.)
country comparison to the world: 53
[see also: Reserves of foreign exchange and gold country ranks ]

Debt - external:
$131.8 billion (31 December 2017 est.) $131.3 billion (31 December 2016 est.)
country comparison to the world: 45
[see also: Debt - external country ranks ]

Stock of direct foreign investment - at home:
$302.9 billion (31 December 2017 est.) $298.2 billion (31 December 2016 est.)
country comparison to the world: 22
[see also: Stock of direct foreign investment - at home country ranks ]

Stock of direct foreign investment - abroad:
$225.3 billion (31 December 2017 est.) $222.6 billion (31 December 2016 est.)
country comparison to the world: 25
[see also: Stock of direct foreign investment - abroad country ranks ]

Exchange rates:
forints (HUF) per US dollar - 279.5 (2017 est.) 281.52 (2016 est.) 281.52 (2015 est.) 279.33 (2014 est.) 232.6 (2013 est.)


NOTE: 1) The information regarding Hungary on this page is re-published from the 2018 World Fact Book of the United States Central Intelligence Agency. No claims are made regarding the accuracy of Hungary Economy 2018 information contained here. All suggestions for corrections of any errors about Hungary Economy 2018 should be addressed to the CIA.
2) The rank that you see is the CIA reported rank, which may habe the following issues:
  a) The assign increasing rank number, alphabetically for countries with the same value of the ranked item, whereas we assign them the same rank.
  b) The CIA sometimes assignes counterintuitive ranks. For example, it assigns unemployment rates in increasing order, whereas we rank them in decreasing order






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