“The development of the Hungarian economy must be moved forward into a new phase; attracting sectors of industry that rely on research & development and innovation is the next target”, Minister of Foreign Affairs and Trade Péter Szijjártó said in Budapest.
The Hungarian Investment Promotion Agency (HIPA) and the American Chamber of Commerce (AmCham) organised a conference to promote dialogue and cooperation between the private and public sectors called Business Meets Government for the second time.
At the event, the Minister stressed: “According to 2010 plans, Hungary must become the regions production centre, and we have succeeded in achieving this, but what we need now id for the Hungarian economy to move up into a higher added value category”.
“The global economy is experiencing major changes; we are living in the age of digitalisation, which means that many companies are performing major technology changes”, he pointed out, adding that “for the reason from the beginning of next year the Hungarian investment promotion system will include new elements that primarily facilitate technological change for companies operating here to enable them to remain competitive under the new conditions and maintain their workplaces”.
Mr. Szijjártó explained that low unemployment is good news, but finding suitable numbers of trained employees is beginning to be a challenge for newly arriving enterprises. “For this reason the Government will be introducing new tax benefits for companies that support workforce mobility. Employees’ travel to work may be subsidised at up to 15 forints/kilometre in addition to housing expenses, and in addition these may be deducted from companies’ tax base”, he explained, adding that ”to all intents and purposes twice the money spent on funding research & development will be tax deductible”.
Following his speech, the Minister told reporters that strategic partnership agreements are not agreements of a legal nature but are aimed at ensuring that the companies involved commit themselves to Hungary in the long term. “It is impossible to exclude the possibility that market processes could force a large international company to implement job cuts worldwide”, he said. “Luckily very few such instances affect Hungary and the companies that have concluded strategic partnership agreements with the Hungarian Government have crated 13 thousand new jobs and brought more than 1500 billion forints (EUR 4.9bn) in investment to Hungary since signing the documents”, he said. Mr. Szijjártó also mentioned that Procter & Gamble has two major ongoing investment projects that will make Hungary a kind of European centre of production for the company and create 250 new jobs.
President of the HIPA Róbert Ésik told the press that the Agency is working to facilitate direct dialogue between businesses and the Government and to ensure that the requirements of the private sector are included in the plan of action that the Government had launched to make the business environment even more attractive.
President of AmCham Ferenc Pongrác spoke about the fact that the Chamber’s recommendations, joint efforts and business-government consultations had contributed to next year’s changes in tax law, as a result of which tax benefits for companies that perform research & development will almost double in 2017, in addition to which companies that are successful in mobilizing their workforce will also be receiving significant tax cuts.
The organisers declared that the conference had been launched in the hope that it would be repeated regularly and that the first such conference led to the development of AmCham’s 19-point package of proposals that included concrete recommendations and undertakings within regard to the business environment, the job market, the digital economy and the field of innovation. The proposals were also put before Prime Minister Viktor Orbán and enterprises also conducted detailed talks with Minister of Foreign Affairs and Trade Péter Szijjártó.
“Partnership with American companies is extremely important to Hungary; the 1600 American enterprises currently operating here have brought more than 9 billion U.S. Dollars of investment to Hungary. The most important criteria for further increasing competitiveness are measures for training skilled labour, expanding the supply base and giving priority to higher added value investments”, the organisers stated.
(MTI)
