The German Chamber of Commerce and the Hungarian Government share a common denominator regarding the perception of Hungary’s economic opportunities and the results achieved to date. This is also reflected in the Chamber’s business survey prepared for the 23rd time this year which the Ministry regards as an important compass, the State Secretary for Economic Development and Regulation of the Ministry for National Economy said in Budapest, at the event of the German-Hungarian Chamber of Industry and Commerce (DUIHK).

István Lepsényi added: according to one of the most important, investor-centred surveys regarding the state of the Hungarian economy, the investor sentiment index has increased to 20 points from 18 last year which gives rise to optimism.

The index reflects the views of businesses on a scale extending from minus 100 to plus 100, inter alia, on the state of the national economy, the business situations and expectations of the businesses interviewed themselves, and their plans regarding sales revenues.

Dale A. Martin, President of the Chamber highlighted that the macro-economic processes are heading in the right direction. It was, however, surprising in the survey to what extent the shortage of workforce is beginning to become a restrictive factor that hinders economic growth.

He said that, by international comparison, Hungary’s relative perception has not improved, it continues to remain in the middle ranges, and is the 9th most attractive country among the region’s 20 countries. He took the view that the gap between the qualifications of workers and the needs of businesses is increasingly widening which may, in the medium-term and in the long run, reduce the competitiveness of businesses. The Chamber has been actively involved in the modernisation of the Hungarian vocational training system for years, and is focusing on the issue as a particular priority this year, by launching several specific programmes, the President of the Chamber said.

According to Mr Lepsényi, they agree that the shortage of labour is the biggest obstacle to growth as Hungary is no longer a country of cheap and unlimited supply of labour. By his account, upon addressing the problem, they copied a number of German examples, including dual vocational training. He drew attention to the importance of digital skills in which they rely on the knowledge and experience of large German companies.

The State Secretary took the view: it is a positive development that 45 per cent of businesses operating in Hungary are planning to expand, and 81 per cent of them said that they would repeatedly bring their investments here, which is an improvement compared with last year’s value. He said that German companies play a key role in the development of the Hungarian economy, Germany is Hungary’s number one economic partner, and exports to Germany accounted for 27 per cent of Hungary’s foreign trade last year which represents a 3.3 per cent increase compared with a year earlier. Germany is the largest foreign capital investor, there are more than 3,000 German-owned businesses in Hungary which employ some 200 thousand people, he said.

Dirk Wölfer, head of communications of the Chamber said that the Chamber reckons with a 3.5 per cent growth in Hungary’s gross domestic product (GDP) this year which is supported by the rise to the highest ever level, to 20 points, of the investor sentiment index. According to the head of communications, the shortage of workforce was described as a major problem primarily by larger businesses active in the processing industry which export their products. These are the very businesses which manifested an above-average investment level earlier, and as a result, their readiness to invest may fall in the future if they fail to find adequate workforce, he said. The research further showed that the shortage of labour causes disruptions at every third company, and 15 to 16 per cent of them are unable to take further orders due to this problem.

He also said that as regards legal security and the general conditions in the economy, dissatisfaction has decreased which is a favourable trend, as is the fact that Hungary performed above the regional average in fiscal administration for the first time.

At the same time, the number of those who are not satisfied regarding corruption and the transparency of public procurements has increased, and 70 to 75 per cent of company executives are not happy with the current situation, as a result of which Hungary scored below the regional average, the head of communications listed the results.

This year’s survey had 230 participants from Hungary, and 1,734 in total in combination with the other 15 Eastern-European countries involved in the research. Almost one half of those interviewed in Hungary were German investors, one quarter were Hungarian, and the percentage of other foreign-owned businesses was around 30 per cent.

(MTI)