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See what the "Economy of Hungary" is in other dictionaries. Economy of Hungary Monetary system of Hungary

Hungary (Hungarian People's Republic)- a state located in the central part. It occupies an area equal to 93 thousand km2. It has no access to the sea, but important transport routes intersect on its territory, connecting different parts of Europe. The Danube waterway connects Hungary with a number of neighboring countries.

The population of Hungary is 10.6 million people. Over 96% of the residents are Hungarians. Germans and Romanians also live in Hungary. indicates a demographic crisis - a natural population decline. One of the reasons for this is the violation of the normal sex and age structure of the population as a result of the Second World War. The official language is Hungarian. Believers - mostly. Hungary belongs to the countries with a high level: about 60% of citizens live in cities. The capital of the state is the city of Budapest, where 2/3 of the country's industry is concentrated and 20% of the total population of Hungary (2.1 million inhabitants) lives.

Although Hungary has its own coal and gas, its reserves do not fully cover the needs of the country, so for a long time it imported oil and gas from neighboring states - the former USSR. Recently, Hungary has begun its own oil development in the south-east of the country. Both thermal power plants and nuclear power plants and hydroelectric power plants play an important role.

The country exports buses (30% of all exports), electronics, agricultural products (25% of all exports): wine, canned vegetables and fruits, pharmaceutical products.

Let's start with the fact that the richness of Hungary's natural resources is based on fertile land and a favorable climate. These natural advantages are realized in agriculture.

In Hungarian agriculture since the early 1990s. there were often signs of a crisis, which was then explained by the general recession of the economy as a whole and the large loss of the number of markets due to the collapse of the CMEA.

The export of agricultural products to the EU countries also suffered.

The reason for this was not the relationship between the EU and Hungary, but the internal problems of the agricultural sector. To be more precise, these were insufficient funding, belated modernization of the industry and low competitiveness.

Hungary's agricultural products are: wheat, corn, sunflower seeds, potatoes, sugar beets; pigs, cattle, poultry, dairy products.

The Hungarian government directs its agricultural policy to strengthen the role of agriculture in the economy, especially in the traditional sectors for this country: the production of corn, wheat, meat, vegetables, fruits, wine.

Agricultural land in Hungary is 6.1 million hectares, of which more than 50% is arable land. 1.5 million hectares are occupied by spike crops, 1.0 million hectares by corn.

Crop production is represented mainly by grain farming, as well as vegetable growing and horticulture (including viticulture).

Livestock provides more than 60% of domestic agricultural income. The most developed are, as mentioned above, pig breeding, cattle breeding for meat and dairy purposes, and poultry farming. The needs of the domestic market are also satisfied by sheep breeding and fish breeding in artificial reservoirs.

Industry

Hungary has favorable agro-climatic and recreational conditions. After analyzing its position, we can conclude that this country is very advantageously located geographically. But the only mineral found in significant quantities is bauxite, mined near Lake Balaton. In 1983, Hungary was the world's seventh producer of bauxite - 2.9 million tons were mined. The main mineral in Hungary is coal. Brown coal and lignites are mainly distributed. Mining is carried out in the area of the cities of Tatabanya, Dorog, Shalgataryan, Gyengyös, Ozd, Miskolc. The presence of other minerals in the country has already been mentioned in chapter I.

Manufacturing industries are the most developed in industry (90.6% of GDP) The leading branch of the manufacturing industry is mechanical engineering, including:

*automotive industry (the Ikarus plant in Budapest and Szekesfehervar is the largest bus manufacturer in Europe).

*Manufacture of locomotives, ships, cranes.

*Electrical and radio-electronic industry (including the production of communications, computers, medical equipment and devices (Budapest, Szekesfehervar)).

*Machine tool building (Budapest, Miskolc, Esztergom).

*Manufacture of agricultural machinery and equipment for light and food industries.

Electrical products, electronics, engines, diesel locomotives, motorcycles, buses, river boats, industrial equipment, televisions and radios, household appliances, etc. are produced. There are ferrous and non-ferrous metallurgy enterprises.

In the chemical industry, an important place is occupied by the production of mineral fertilizers, plant protection products, organic synthesis products, the rubber industry, various types of plastics, and synthetic materials are developing. Pharmaceutical production has reached a relatively high level (15% of the value of industrial products). With a long tradition, this industry relies on a strong research and development base, with the help of which ever more effective means of combating various diseases are being developed.

The food and flavor industry is significant: large meat and dairy and canning enterprises. Of the branches of light industry, the most developed are sewing, leather and footwear, and knitwear. Hungarian fabrics, ready-to-wear, shoes, furniture, as well as products of the meat processing and canning industries are well-deservedly known in many countries of the world.

The food industry relies almost entirely on the domestic raw material base, while some sectors of the light industry require significant imports of raw materials and semi-finished products. Hungary imports cotton, wool, flax, raw leather, timber, and cellulose.

In Hungary, as in many other countries, a large number of industries are developed, but I would like to dwell on one such as oil refining. (see appendix 3)

Industrial oil production in Hungary began in 1937, and a year later the Hungarian-American Society of the Oil Industry was created, which operated until the outbreak of World War II.

The leading role in the Hungarian fuel and energy market is played by the oil and gas industry joint-stock company Mol. JSC Mol is, in essence, a monopoly association for the extraction, processing and sale of natural gas, oil and products of their processing on the domestic and foreign markets. The company's total sales for 2009 amounted to $15,947 million.

AO Mol owns four centers for oil refining and production of petroleum products. These are: "Danube Refinery" in Sazkhalombatta, "Tisai Refinery" in Tissaujváros, "ZALA Refinery" in Zalaegerszeg and a refinery in Almashfuzit. Oil refining is carried out only at the Danube Oil Refinery, which was put into operation in 1965. As a result of economic reforms and rationalization of production, only semi-finished products are produced at the Tisai Oil Refinery, and special bitumen is produced at the ZALA Oil Refinery. Since July 2002, only various types of oils and additives for them have been produced at the plant in Almashfuzit.

The reduction in sales of various grades of gasoline over the past two years was caused by the global financial crisis. The increase in sales of diesel fuel was caused by an increase in the fleet of various types of vehicles with diesel engines, as well as the lower cost of diesel fuel compared to gasoline.

According to the management of the Hungarian Petroleum Association, as well as from experts of the company Lukoil Hungary, which is present on the Hungarian retail market of petroleum products, the dynamics of retail prices for motor fuel in Hungary does not depend on fluctuations in the costs of producing petroleum products.

The main price benchmark for Hungarian retail market participants is the weekly reviewed indicative average price for gasoline and diesel fuel, set by the price committee of the Hungarian national oil company Mol. Determination of indicative prices is carried out by the price committee based on the analysis of wholesale prices of European markets for petroleum products (Genoa, Italy and Rotterdam, Holland), published daily on www.platts.com, taking into account the following main factors: trends in wholesale prices for petroleum products in European markets; dynamics of the Hungarian forint against the European currency; excise tax on motor fuel; fee for the maintenance of strategic reserves of oil and oil products; general turnover tax (similar to VAT); other factors.

Fluctuations in the exchange rate of the Hungarian forint against the European currency also significantly affect the formation of retail prices for gasoline and diesel fuel. In addition to regulating the excise tax, the state can also provide, on the basis of the law on the formation of mandatory strategic reserves of imported crude oil and petroleum products, the Association for Reserves of Oil and Petroleum Products (KKKSz.), which provides for the mandatory membership of all market participants, was established. In accordance with the law, the Association must ensure the accumulation of strategic reserves corresponding to 90 days of domestic consumption, calculated based on the results of the previous year.

Strategic stocks consist of motor gasoline, diesel fuel, fuel for power plants and crude oil. In the short term, Hungary's dependence on Russian supplies of energy and raw materials will continue.

Hungarian industry is quite dependent on the state of the world market: more than half (52%) of all industrial production is exported. Large enterprises export - depending on the industry - 60-80% of their products. The needs of the domestic market are satisfied mainly by small and medium-sized enterprises (the number of employees, respectively, is up to 50 and up to 300 people).

A small country in Eastern Europe is widely known for its tough policy towards migrants from the Middle East and North Africa. The Hungarian economy is largely dependent on the work of transnational corporations. More than 50% of the country's GDP is produced by enterprises with foreign capital, which is much higher than the generally recognized optimal level of 30%.

general information

Hungary is a continental state in Eastern Europe, with a population of about 10 million people (89th place in the world) and an area of 93 sq. km (109th place). Has no access to the sea. Most of the population (54.5%) professes Catholicism, the second largest community is the community of Protestant Calvinists - 15.9%. In terms of ethnic composition, it is practically mononational, Hungarians make up 92.3%, 95% of the population consider Hungarian to be their native language.

According to the form of government, it is a unitary parliamentary republic. The legislative body is the National Assembly, which is elected by the citizens of the country for 4 years. Parliament elects a president who performs primarily representative functions. Executive functions, including the management of the Hungarian economy, are carried out by the Prime Minister and the Cabinet of Ministers.

"Goulash communism"

The country adopted Christianity in 1000 AD and for a long time resisted the Turkish expansion of the Ottoman Empire into Europe. For several centuries, a small Christian kingdom resisted a huge Muslim empire. After that, the country became part of the Austro-Hungarian Empire, which collapsed following the results of the First World War. After the Second World War, it fell into the sphere of influence of the Soviet Union. In 1956, only Moscow's military intervention stopped the country's departure from the socialist camp.

The liberalization of the economic system began in 1968. When businesses and people were given the freedom to do business. When asked what kind of economy in Hungary, then they answered "goulash communism", the so-called socialism, which they began to build under Janos Kadar. In 1990, the country held multi-party elections for the first time in post-war history and finally began the transition to a free market economy. In 1999, the country joined the North Atlantic bloc, and five years later it was admitted to the European Union.

Economy Overview

Hungary has almost completed the transition from a centrally planned economy to a free market economy. However, in recent decades, the government has become more involved in managing the economy. Budapest has used unorthodox economic policies to increase household consumption. The funds invested by the EU in projects to stimulate the growth of the Hungarian economy were also quite effectively directed.

The per capita income of the country has reached about two-thirds of the European Union average. The minimum wage set by the state in 2018 is HUF 137,000.

The country's economy is heavily dependent on exports, which have reached about $101 billion. The biggest trading partner is Germany, followed by the US and Romania. The main export positions are industrial equipment and goods, food, raw materials.

Some indicators

It belongs to the type of post-industrial states with a predominant service sector (64.8%), export-oriented industry occupies 31.3%, and highly developed agriculture - 3.9%. Hungary is a country in transition, where market reforms are almost completed. The country has a well-developed infrastructure, a relatively high level of education and qualifications of workers. The population has good social mobility and susceptibility to innovation.

According to statistics, the Hungarian economy with a GDP of $120.12 billion in 2017 is in 56th place in the world. GDP per capita at PPP is $28,254.76 (49th place). Despite the fact that the country is part of the European Union, the national currency is the Hungarian forint.

The key industry is industry

The main sectors of the Hungarian economy are high-tech industry, agriculture and services, especially tourism.

A highly developed industry (engineering, production of communications equipment, measuring instruments, machine tools) provides the bulk of export products. The material and energy-intensive production created with the assistance of the Soviet Union is gradually decreasing. Thus, Ikarus, once the largest bus manufacturer in Europe, has been reduced to a small bus-building enterprise. Thanks to a good investment climate, many modern factories of global corporations have been built in the country, including automobile factories of Audi, Suzuki and General Motors, electrical plants - Samsung, Philips and General Electric.

The pharmaceutical and chemical industries have been working well since socialist times. The country has developed metallurgical production, especially aluminum, which works on local raw materials. In the energy sector, the country seeks to reduce its dependence on the import of petroleum products, therefore it is developing the nuclear industry and renewable energy sources.

Other industries

Thanks to good climatic conditions, the country is famous for its agricultural products. Since 1990, privatization and restructuring of the industry began. Ownership of the land was returned, many cooperatives were dissolved, and their lands were privatized. Now in agriculture there are both private and family farms, as well as cooperative farms and land associations. Most of the arable land is privately owned.

Wheat, corn, sugar beets, sunflowers, various vegetables are grown, including onions, cucumbers, and peppers. The developed wine production is known for its table wines, Hungarian Tokay wine (from the slopes of Mount Tokay) is especially popular in Europe.

Many countries of the world are supplied with products of agricultural processing enterprises: compotes, juices, canned vegetables and meat. Famous from Soviet times, the Hungarian "Globus" is one of the few brands that have survived in the country since the days of "goulash communism". The company occupies more than a third of the local canned vegetable market. True, the presence of products on the Russian market is insignificant.

International tourism is one of the leading sectors of the Hungarian economy, generating up to 10% of GDP. The stable economic and political situation has made the industry very attractive for foreign investment.

Natural resources

The country's most important natural resources are fertile arable land and water resources. More than half of the Hungarian lands are arable. Which, together with a mild climate and vast reservoirs, create excellent conditions for agriculture.

The country is experiencing a deficit in energy resources, the deposits of which are relatively few. High-quality hard coal is mined in the Komlo region, brown coal near Ozd in the Northern Mountains and in the Transdanubia region. Previously mined local coal fully satisfied the country's energy needs. Due to the development of industry, at present it provides no more than a third of the needs of the Hungarian economy.

The country's most significant mineral resource is bauxite; one of the best European deposits is located on its territory. Raw materials are processed by the Hungarian steel industry. Manganese ores are mined in the Bakony mountains. In addition, copper, lead, zinc and uranium ores are mined. Mined in relatively small quantities of molybdenum, dolomite, kaolin.

Strengths

The main advantage of Hungary is a good investment climate, which has contributed to a large influx of foreign direct investment. A fairly effective tax system has been built in the country, bureaucratic procedures have been significantly reduced.

The Hungarian economy, having strengthened by the end of the 90s, demonstrates stable growth based on the stimulation of foreign trade. It has a well-developed industrial production, especially in new modern companies and branches of transnational corporations. The national currency has been fully convertible since 2001. Inflation is at an acceptable level and is steadily declining.

Weak sides

The weaknesses of Hungary's transitional economy include insufficient domestic energy production. Strong differentiation of regions according to the level of development, when the eastern, predominantly agricultural, territories do not receive sufficient investment.

In addition, there is a significant difference in the technical equipment of enterprises with foreign participation and purely Hungarian ones. There is a significant difference in the level of incomes of the population in the country. The country is on the "black list" of the OECD due to poor money laundering control. If we talk briefly about the weaknesses of the Hungarian economy, then this is, first of all, the legacy of socialism.

Transition to a market economy

After the destruction of the socialist camp at the end of the 20th century, the Hungarian economy experienced a significant decline due to the decline in exports and the cessation of financial assistance from the former Soviet Union. The country embarked on sweeping economic reforms that included the privatization of most state-owned enterprises, cuts in social spending, and a reorientation towards trade with Western countries.

The measures taken stimulated growth, attracted foreign investment and reduced national debt obligations. The transition from a centralized to a market economy had a strong impact on the standard of living of the population. Living conditions in the early years deteriorated significantly against the backdrop of strong inflation. A gradual improvement occurred as the reforms succeeded and export growth increased significantly. The economic policy of the first decades allowed the country to join the European Union in 2004.

As a result of the crisis in the global economy, Hungary suffered significant losses in 2008-2009 due to a decrease in demand in the global market and a contraction in domestic consumption. The country had to resort to financial assistance from the IMF and the EU.

New economic policy

Beginning in 2010, the government backtracked on many market-based economic reforms and adopted a more populist approach to managing the Hungarian economy. The new prime minister, Viktor Orban, has pushed for greater state involvement in key sectors, through public procurement, changes in legislation and regulation.

In 2011, private pension funds were nationalized, which contributed to the reduction of public debt and the budget deficit to an acceptable level (below 3% of GDP). Since pension contributions began to be collected by the state pension fund. However, public debt remained quite high compared to other Eastern European countries.

Nationalization and deprivatization

In 2014, the state bought the Budapest Bank from the American financial and industrial group GE, thus the government ensured the share of Hungarian capital in the banking sector in the amount of more than 50%. Orban considers it necessary to bring this figure to 60% in order to then sell the banks to local entrepreneurs. That should ensure the independence of the monetary system.

The government has taken other steps to de-privatize and nationalize key industries, including the purchase of a stake in Mol, the largest Hungarian oil and gas company, the buyout of E.ON Földgáz Storage and E.ON Földgáz Trade, engaged in the wholesale of natural gas, and many others. Probably, if we talk briefly about the modern economy of Hungary, then this is now "goulash capitalism."

Economy at present

Real GDP growth has been robust in recent years due to increased EU funding, stronger demand for Hungarian goods in the European market and a recovery in domestic household consumption. In 2018, the country's economy is projected to grow by 4.3%, last year it was 3.8%. The increase was due to the pre-investment of projects funded by EU funds.

The government has launched a six-year plan to gradually increase the minimum wage and public sector wages. It is planned to reduce taxes on food products and services. Income tax will also be reduced to 15% from the current 16%.

Economy of Hungary

Hungary - a state with a rapidly developing economy, market reforms in it are almost completed. Benefits: Stronger by 1998, Hungary opened up to foreign direct investment. An efficient tax system. Reducing bureaucracy. Since the end of the 90s. stable growth based on exports. Developed industrial production, especially in new modernized firms. Fully convertible currency since mid-2001 Decreasing inflation.
Weaknesses: insufficient energy production. Gap in domestic development, eastern rural areas do not receive sufficient funding. Big income disparity. Lack of control over money laundering. Hungary is on the OECD black list.
Hungary mainly exports engineering products and other manufactured goods.
The main partner in foreign trade is Germany (more than a quarter of Hungary's trade turnover in 2006).
September 19, 2006 in Budapest, popular unrest in connection with the publication of statements by the Prime Minister about the deplorable state of the economy.
The largest bank in Hungary is OTP Bank. Currency - Hungarian forint.

In the two decades following the end of World War II, Hungary transformed from a predominantly agrarian country to an industrial-agrarian country. In 1968, Hungary embarked on an economic reform known as the "new economic mechanism." Industrial and agricultural enterprises were given greater autonomy in the production process and in making sales and marketing decisions; trade with Western countries expanded significantly; domestic prices increasingly converged with world market prices, and people were given wide freedom to engage in all kinds of small private businesses.

In 1990 Hungary began the transition to a free market economy. Some important economic measures were taken in the early 1990s, but major reforms began in 1995 when Finance Minister Lajos Bokros presented his radical program.

The new government began to introduce a market economy by reducing the share of state ownership, increasing the share of foreign capital in investment, and removing obstacles to freeing the market and introducing open competition. By 1994, the share of the private sector in the gross domestic product increased to 45%, and foreign direct investment increased from $200 million to $5 billion. However, the abrupt transition created a significant budget deficit and left many on the brink of survival. In 1995, after the introduction of the Bokros reforms, Hungary's progress towards a market economy gained momentum. Foreign investment continued to grow, accounting for half of all foreign investment in the countries of the former Eastern Bloc. In 1995 more than $4 billion of foreign direct investment (FDI) was sent to Hungary, in 1996 and 1997 $3.6 billion were invested.

Hungary- industrial-agrarian state. It has a fairly developed infrastructure, a relatively high level of education, qualifications, social mobility and innovative susceptibility of the population. Hungary's most important natural resources are fertile land and water resources. More than half of the country's land is arable, and the climate also favors the development of agriculture. Energy fossil deposits are relatively modest. High-quality coal is mined in Komlo, brown coal in the Northern Mountains (near Ozd) and in Transdanubia. Previously, mined coal satisfied all national energy demands, now coal covers no more than a third of the country's needs. The most significant mineral resources that the country has are bauxites (one of the richest deposits in Europe), manganese ores (Bakony Mountains), copper and zinc ores. Lead ores, uranium, molybdenum, dolomite, and kaolin are being mined. As Hungary seeks to reduce its dependence on oil imports, nuclear power plants are given priority in the development of the energy sector.

During the 10 months of 2002, the volume of industrial production increased by 1.8% compared to the previous year. The most significant growth (2.6%) was observed in the processing industry. The increase in production was obtained through exports. Exports of goods manufactured by industry increased by 4.5%, while domestic sales decreased by 0.1%. Mechanical engineering played a leading role in the growth of export sales of industrial production. The chemical industry turned out to be the most competitive among traditional industrial sectors: by the mid-1990s. the growth of its production amounted to 25%. New promising industries have also appeared: the production of telecommunications and automotive equipment.
In the first 10 months of 2002, the construction industry experienced rapid growth. Production in the construction industry increased by 21.5% compared to the previous year. The main role among the sub-sectors was played by the growth in the productivity of underground and assembly construction. Significant investments were made in transport and communications infrastructure, as well as municipal utility networks, and the construction of industrial and commercial facilities and shopping centers accelerated. While at the beginning of the 1990s large state-owned enterprises dominated the construction industry, since 1994 more than 60% of production has come from domestic joint-stock companies. The share of foreign capital in the construction industry exceeded 1/3, and in the production of building materials is 70%.

One of the most important and most productive sectors of the Hungarian economy is tourism, which accounts for about 10% of GDP. The material base of tourism is more than 140 thousand places in accommodation facilities of various categories. About 300 thousand people work in tourism, which is about 7% of the active population. In 2001 tourism revenue was 4.4 billion euros, and the balance sheet was +2.9 billion euros. Hungary receives over 30.7 million foreign visitors, and for 11 months of 2002 - 29.4 million, more than half of which are tourists. The average duration of stay of foreign tourists in the country is 3-4 days. The Office of the Trade Advisor for Tourism of the Republic of Hungary (at the embassy) operates in Moscow.

In Hungary, wheat, corn, sugar beets, sunflowers, onions, cucumbers, and peppers are grown. Wine production is developed, mainly table wines are produced, Hungarian Tokay wine (from the slopes of Mount Tokay) is popular. The industry for processing agricultural products is developed: canned vegetables, compotes, juices, canned meat. In comparison with the previous year, for 10 months of 2002, the sale of agricultural products decreased by 5%. The number of cattle increased by 3.5%, while the number of pigs and poultry decreased by 11.1% and 6.5%, respectively. Sales of crop and horticultural products decreased. At the same time, the sale of fruits increased by 13.8%, while sales of grapes and wine decreased by 5.4%. The export of the food industry increased by 2.6%.

More than half of the national income comes from foreign trade. More than 2/3 of exports go to the EU countries: Germany, Austria, Italy, the Netherlands. The composition of exports: engineering products 51.9%, other industrial goods 32.7%, food and food industry products 10.5%, raw materials 2.9%, energy and electricity 1.9%. Composition of imports: engineering products 46.5%, other manufactured goods 40.2%, energy carriers and electricity 6.6%, foodstuffs and food industry products 3.7%, raw materials 3.0% The volume of domestic trade increased over the 10 months of 2002 by 11.4%. During the year, the growth rate slowed down. Food products accounted for the largest share (31.4%) in the total volume of retail trade.

The volume of foreign direct investment in 2001 was 2.4 billion euros. The amount of foreign direct investment, together with loans provided by investors for joint ventures (JVs) and material contributions to the founding capital of the JV, approached 28 billion euros by the beginning of 2002, and the number of enterprises with foreign capital participation exceeds 26,000. At the end of 2001, Hungary had 2,340 euros of foreign investment per capita. 45 of the 50 largest multinational companies in the world are already present on the Hungarian market. They generate one third of Hungary's GDP and employ 43% of the industrial workforce. Most of the capital came from Germany, the United States of America, France, Austria and Holland, with significant investors being Israel, Switzerland and Italy. The largest investments were made in the field of communications, electric power, heat, gas and water supply, processing industry. Significant investments of foreign capital were made in the financial and banking sectors.

On December 12, 1990, an Agreement was signed between the Government of the Republic of Hungary and the Government of the RSFSR on trade and economic relations, which created a modern framework for cooperation between the two countries. This agreement defines the market terms of trade, such as the settlement in hard currency, the use of world market prices, as well as the promotion of authorized state bodies in the development of trade carried out by public and private sector organizations.

In 1999, Hungary introduced new restrictions on imports from Russia and created conditions aimed at ousting Russian goods from the Hungarian market. Last year, Russian exports to Hungary fell by 21%, while deliveries from Hungary to Russia fell by 33%. In the first two months of this year, compared to the previous year, mutual supplies continued to decrease, while Hungarian exports to Russia decreased by 70%. Goods from Russia to Hungary are subject to the highest customs duties and fees. Thus, Russian metal products have been practically ousted from the Hungarian market. Since the new year, an additional 30% duty on nitrogen fertilizers from the Russian Federation has been introduced.

Russian exports consist almost entirely of energy and commodities, while Hungarian exports are dominated by food and consumer goods.

In Hungary, after the change of the social system, from year to year there was a significant increase in the number of business companies and other private enterprises. Currently, there are only 800,000 economic organizations operating in the country. In Hungary, economic companies, cooperatives, private entrepreneurs, as well as Hungarian subsidiaries of enterprises located abroad have the right to conduct business activities. Among the operating economic organizations, 96.5% are micro-entrepreneurs with less than 10 employees, the share of small enterprises is 2.7%, medium-sized enterprises 0.6%, while large enterprises account for only 0.2%.

Currently, there are several types of commercial organizations: a general partnership (PT), a limited partnership (CT), a limited liability company (LLC) and a joint-stock company (JSC). After signing the founding document, having secured the departmental permits necessary to start activities, a commercial organization begins its existence from the date of registration with the judicial authority (which registers and supervises the activities of commercial and non-profit organizations) at the location of the company. In parallel with this, the organization must register with the tax authority and the social insurance authority.

Of all forms of commercial and non-commercial organizations in 2001, the most popular are CPs (47%), followed by LLCs (40.4%), while JSCs represent only 1.1%. Of the total number of registered organizations, 96.6% are micro-enterprises (with less than 10 employees), the share of small enterprises (from 10 to 50) is 3.4%, medium enterprises (from 50 to 200) 0.9%. Large enterprises (more than 200) account for only 0.1%.

Since February 1, 1999, in Hungary, individual entrepreneurs can be not only domestic individuals, but also citizens of EU member states. The local administration, on the basis of relevant documentation and necessary departmental permits, issues a certificate of individual entrepreneurship to the applicant. Provides him with a social security checking account number, tax and statistical codes.

Hungarian monetary system

Since 1987, a two-tier banking system has been operating in Hungary in 1987: the Hungarian National Bank (VNB) carries out the emission and credit policy, general control over the financial market, and authorized financial institutions lend directly to economic entities.

In 1991–1994 the government's program of banking consolidation was implemented, aimed at improving the crisis state of most banks and increasing their assets, improving the loan portfolio. Since 1995, the sale of blocks of shares in consolidated banks to reputable Western financial institutions began. By 1998, the privatization of Hungarian banks was practically over. The level of presence of foreign capital in the banking system is 63%.

The Hungarian system of credit institutions by 2000 already consisted of 43 banks (90.3% of all financial and credit operations), 226 savings cooperatives (5.6%), 9 specialized financial institutions (3.6%) and 4 housing savings cash register (0.5%).

The degree of concentration of banks in Hungary is quite high: the top six banks collectively own almost 60% of the assets of the banking system.

The public finance system structurally consists of four subsystems: the central government (central level), local governments (local level), separate state funds, and social insurance bodies.

In 1998–2001 The overall level of the central government budget deficit has consistently decreased from 4.8% to 3.3% of GDP. In 2002, there was a sharp surge - up to 9.6% of GDP, caused by a change in government and a massive increase in social benefits.

At the same time, the revenue part of the state budget amounted to 17.8 billion dollars, of which about 80% were tax revenues (taxes, excises, duties). Measures to improve the efficiency of the private sector led to a reduction in the degree of centralization of budget revenues: the share of state budget revenues in GDP in 1994-2002. decreased from 52.5 to 27%.

The main place in tax revenues to the budget is occupied by the general turnover tax (analogous to Russian VAT), whose share is 39%, income tax (24% of revenues), consumer tax and excises (19%), business profit tax (called corporate tax) - ten%.

In Hungary, the treasury system of budget execution is used, i.e. all funds necessary for state institutions are received and spent from the so-called. single treasury account. The Hungarian State Treasury is responsible for the technical work of financing the central budget.

In addition, the divisions of the Hungarian financial system are also the State Supervision of Financial Organizations (activities related to monitoring compliance with the law by participants in the stock and currency markets), a set of banking and financial institutions, organizations providing services for non-state management of financial markets (stock and commodity exchanges, central clearing house, brokerage and dealer firms, etc.), insurance companies and pension funds.

All functions related to the management of public debt (including the currency and forint components) are performed by a specially created Center for Public Debt Management (PDMS). The CDGD was tasked with a gradual transition from the practice of attracting foreign loans to finance external debt obligations to the issuance of government bonds denominated in the national currency - forints.

The growth of the gross domestic product in 2005 was (according to preliminary data) 4.1% against 4.6% in 2004.

Hungarian transport

Hungary has a well-developed network of transport communications. The length of public roads is more than 30 thousand km, 90% of them have a hard surface. Railways - 7.9 thousand km. The length of inland waterways is 1.6 thousand km. The main river port is Budapest. Water transport is especially important for the transport of heavy goods such as iron ore and coal. Except during the coldest part of winter, the Danube is navigable throughout its entire length in Hungary, and the Tisza as far as Szolnok.

Domestic air transportation is not carried out, there is a network of small airfields for receiving small aircraft. Ferihegy International Airport is located near Budapest.

The transit role of the country is also important. Oil pipelines Druzhba-I (from Ukraine), Druzhba-II (from Slovakia) and Adria (from Croatia), gas pipelines Bratstvo (from Ukraine) and Baumgartner-Gyor (from Austria) pass through the territory of Hungary ); the total length of pipelines is 7.2 thousand km. The construction of high-speed highways is being actively carried out within the framework of the so-called. Helsinki transport corridors: in 2002, already 60% of the Hungarian sections of the “corridors” met the established European requirements.

The total freight turnover is 26.9 billion tkm (2002). Structure by types of transport: road - 51%, rail - 30%, pipeline - 15%, water - 3%. Structure by directions of transportation: international - 60%, domestic - 40%. Water and air transport are practically not used in domestic cargo transportation. Passenger traffic on intercity transportation is 785 million people, on intracity transportation - 2.8 billion people. (2002).

Agriculture in Hungary

The main agricultural regions of the country are located on the plains of the central and eastern parts of Hungary. The soils of Hungary are generally fertile and favorable for the development of agriculture, but vary greatly in composition and fertility. The dominant type is chestnut and podzolic soils, which cover 2/5 of the country's territory. About 25% of the area of Hungary is occupied by black soil. These soils are common in a large part of the Alfeld. Hungarian chernozems are distinguished by a powerful humus horizon, a weak alkaline reaction, and high fertility.

In 1990, the process of restructuring and privatization of agriculture began. The landowners were given back their property, many cooperatives were dissolved and their lands were privatized. A transition is gradually being made towards a mixed system of private and family farms, land associations and reorganized cooperatives based on shared ownership and market-oriented production. Already in 1995, only about 30.6% of suitable land was cultivated by cooperatives, 17.6% was in state ownership, the rest of the land belonged to private individuals and enterprises.

Despite a severe drought in the early 1990s and the difficulties associated with the transition to a market economy, agricultural products continued to be an important export item.

The agrarian policy of the government is aimed at strengthening the role of agriculture in the economy, especially in traditional sectors for Hungary: the production of corn, wheat, meat, vegetables, fruits, wine.

In the structure of agricultural production, the share of crop and livestock production is approximately equal.

Crop production is represented mainly by grain farming, as well as vegetable growing and horticulture (including viticulture). Grapes are grown almost everywhere in Hungary, the wines of 14 wine-growing regions, most of which are located at the foot of the middle mountains, are especially valued. Hungary is famous for the excellent quality of its white (Tokaj, Bada-chon) and red (Egribikever) wines. Suffice it to mention, for example, the famous Tokay wines "asu" and "nuggets", about which Goethe spoke as follows: "Tokay wine is the king of wines and the wine of kings."

62.6% of the sown area is occupied by cereals and grain legumes, 13% by technical crops, 2.9% by vegetables, and 19.1% by fodder crops. Among them: wheat, corn, industrial crops (sugar beet, sunflower), hemp. Fruit growing is also developed in Hungary, the climate is favorable for growing apples, apricots, peaches, plums, pears, cherries, etc. The famous Jonathan apple variety is grown in the northeast. Large arrays of apple orchards are also spread between the Danube and Tisza rivers, as well as in the southwest. In Europe, Hungarian apricots are well known, grown throughout the country, especially in the interfluve of the Danube and Tisza. The main peach growing areas are the Balaton Middle Mountains, the vicinity of Budapest.

Livestock provides more than 60% of domestic agricultural income. The most developed are pig breeding, breeding of cattle for meat and dairy purposes, and poultry farming. Hungary is a major exporter of chickens, geese, ducks, and turkeys. The needs of the domestic market are also satisfied by sheep breeding and fish breeding in artificial reservoirs. Hungary is one of the main honey producers in Europe.

Fish ponds supplied with fry from hatcheries occupy more than 25,300 ha, i.e. 0.3% of the entire territory of the country. Fish for commercial purposes is also caught in the Danube and Lake Balaton. In 1992, the total catch of fish, primarily carp, was 20,000 tons.

Hungary gradually restored its forests, which in 1998 covered an area of more than 1.6 million hectares, i.e. 17% of the entire territory of the country. Every year the country imports a large amount of timber.

Despite the steady positive trends in the development of agriculture, the volume of production here in 2001 amounted to only 72% of the 1990 level. In addition, integration with the EU has significantly increased competition in the sale of agricultural products in the domestic, Western European and other markets.

Hungarian industry

The country is not rich in natural resources, but has favorable agro-climatic and recreational conditions, and is advantageously located geographically.

The only mineral found in significant quantities is bauxite, mined near Lake Balaton. In 1983, Hungary was the world's seventh largest producer of bauxite with 2.9 million tons mined. However, by the end of the 1990s, many mines were closed, and bauxite production has fallen to around 1 million tons, down from 1.7 million tons in 1992.

The main mineral in Hungary is coal. Brown coal and lignites are mainly distributed. Mining is carried out in the area of the cities of Tatabanya, Dorog, Shalgataryan, Gyengyös, Ozd, Miskolc. Coal is also mined in the Mecsek mountains. In the Miskolc region (in the northeast) there are deposits of iron ore. Hungary also has reserves of metals such as iron, gallium, molybdenum, copper, zinc, gold, manganese. Hungary produces small amounts of oil and natural gas from wells in the Szeged Basin and the Zala region in the country's southwest. In 1998, 3.5 million tons of oil and 4.7 billion cubic meters were produced here. m of natural gas. Manganese and iron ore deposits are being developed. Hungary has uranium ore, but all information about its extraction is classified.

Manufacturing industries are the most developed in industry (90.6% of GDP) The leading branch of the manufacturing industry is mechanical engineering, including:

Automotive industry (Ikarus plant in Budapest and Szekesfehervar - Europe's largest bus manufacturer).

Manufacture of locomotives, ships, cranes.

Electrical and radio-electronic industry (including the production of communications, computers, medical equipment and devices (Budapest, Szekesfehervar)).

Machine tool industry (Budapest, Miskolc, Esztergom).

Manufacture of agricultural machinery and equipment for light and food industries.

After a recession in the late 1990s production is stabilizing in metallurgy and light industry, which works almost exclusively on raw materials supplied by the customer. The share of energy and water supply is 8.9%. In the extractive industries, production is gradually curtailed.

In addition, handicrafts are widespread in Hungary: embroidery, ceramics, curtains, wooden toys, dolls, wicker baskets, porcelain, goose down products.

Energy industry in Hungary

The energy needs of the country are less than 50% provided by their own resources. Oil and natural gas are imported from Russia in transit through Ukraine. The Adriatica oil pipeline is operating from the port of Rijeka in Croatia. Natural gas also comes to the country from Romanian Transylvania.

In 1997, about 69.3% of Hungary's total energy consumption came from hydrocarbon sources, 12.6% from coal, 10.1% from nuclear power, 7% from exported electricity, and 1.0% from wood.

In 1983, a nuclear power plant went into operation at Pakse, on the Danube, south of Budapest. The 4 reactors at Pakse produced 13,968 megawatts of electricity in 1997, providing approximately 38% of the country's energy consumption as a whole.

Foreign economic relations of Hungary

A characteristic feature of the Hungarian economy is a high degree of openness and participation in the international division of labor. Foreign trade has a positive trend, but is chronically passive. Thus, the volume of exports in 2002 was 34.3 billion dollars, imports - 37.6 billion dollars.

In the commodity structure of exports in 1998–2002. products with a high degree of added value prevailed: the groups “machinery and equipment” (57–59%; mainly communications equipment, sound processing equipment, automated data processing systems, household and industrial electrical appliances) and “manufactured products” (29–31% ). Agricultural products accounted for 7-8% of exports.

The main contingent of imports was also "machinery and equipment" (50-52%) and "processed products" (35-38%). The share of energy carriers in imports is 6–8%, and Russian energy carriers account for 70% of all energy supplies to Hungary.

More than 90% of Hungarian exports in 2002 were sent to European countries. 75% of imports came from there. The largest trading partners are Germany, Austria, Italy, and the share of the EU reaches 72%. Russia ranks 8th among trading partners.

They prefer to do business with America prudently, despite the attractiveness of trade and economic cooperation with it, because they see the overseas economy as the main factor of uncertainty and instability for the entire world economy. Hungary's relations with neighboring countries are developing dynamically, with Hungarian experts predicting high rates mainly in relations with Poland and Slovenia.

A favorable business climate in the country, a fairly high position in the rating of international agencies attract foreign capital. By the end of 2002, 24.5 billion dollars of foreign investment had been accumulated (3rd place in Eastern Europe after Poland and the Czech Republic). For comparison: in the second half of the 1990s. the influx of foreign capital investment was only about 2.0 billion dollars annually. 70% of investments are associated with the acquisition of privatized enterprises, 30% - the construction of turnkey enterprises.

Foreign economic relations are carried out not only at the state-formal level, but also at the level of business circles. In this regard, the example of business-like Russian-Hungarian cooperation is indicative. In 2004, according to the Ministry of Economy of the Republic of Hungary, the trade turnover of the Russian-Hungarian trading house should approach $10 million. Fifteen years ago, one of the leading CMEA countries, Hungary, strengthened the economy of the eastern bloc with electronics, optics, medical equipment, pharmaceuticals and Ikarus buses - 11 thousand per year.

For more than a decade, the political and economic ties between Hungary and the USSR have been strengthened by the Druzhba gas pipeline and the Mir energy system. Meanwhile, the country with the highest standard of living in Eastern Europe and a developed industrial infrastructure has significant potential not only for developing joint business with Russia, but also for integrating the interests of neighboring states seeking to trade with us.

Moscow businessmen took upon themselves the solution of these problems, having established the Russian-Hungarian trading house "G.A.K.-3000" in Budapest. ”, is engaged in deep processing of wood according to export standards. The annual production volume is about 25 thousand cubic meters of lumber.

Boards, moldings, garden houses are exported to Hungary from the Pskov region. The Russian-Hungarian Trading House (85% of Russian and 15% of Hungarian capital) began its activity by organizing permanent exhibitions of industrial and agricultural products: Russian - in Budapest and Hungarian - in Pskov.

When choosing an exhibition site, Pskov was preferred among several cities as a zone of cross-border cooperation, the center of the intersection of transit highways.

The exhibitions are designed to promote products from the regions and republics of the Northwestern Federal District to Europe. Pskov plants of mechanical drives, ADS, Pskovkabel, sewing factory Slavyanka have already expressed their desire to be exhibitors in Budapest. Hungarian entrepreneurs want to see the products of Novgorod, Vologda, Petrozavodsk, Kaliningrad enterprises in Budapest. Similar interest was expressed by businessmen from Slovenia, the Czech Republic, and Austria - countries bordering Hungary.

Hungarian textile and shoe makers, pharmacists and instrument makers, winemakers and producers of canned vegetables send goods to the permanent exhibition in Pskov.

Attracting the Union of Entrepreneurs and the Union of Hungarian Craftsmen to the Budapest exposition will give North-West manufacturers a chance to test the competitiveness of their goods before Russia joins the World Trade Organization, and someone to enter the Eastern European market without waiting for the WTO to tighten export conditions.

Socio-economic reforms in Hungary

The economic policy of the country's leadership in recent years has been aimed at deepening market reforms, consolidating economic growth trends, expanding the geography of foreign economic relations and integrating into European economic structures. It is based on the legislative protection of all types of property, including private property, privatization and the widespread attraction of foreign investment. The share of the private sector in the country's economy has exceeded 75%, and in terms of foreign investment, Hungary is the leader among the countries of Central, South-Eastern and Eastern Europe. The most significant investors are the USA, Germany, Austria.

In 2000–2001 The government failed to implement plans to reduce inflation. By the end of 2001, this figure was about 8%, and the stratification of society, the rather low growth in real incomes of the population (according to the results of 2001 - by only 1.9%) are fraught with an increase in social tension.

Nevertheless, in recent years, Hungary has been able to maintain relatively high economic growth rates. If in the early 1990s - during the period of change of the socio-economic system - GDP has been steadily declining, then, since 1995, its stable growth has been noted.

Hungary is notable for the comparative smoothness of social contrasts, although property stratification is growing.

The system of social benefits is being restructured according to the principle of need. The main goals of the reform are to reduce the burden of the state budget and reduce the volume of the shadow economy. However, the initiated transition to insurance financing of health care is accompanied by a reduction in hospital beds and medical staff, a revision of the drug reimbursement system, and an expansion of the range of paid services.

As for the pension system, its goal is to move to a mixed pension system, which implies the introduction of insurance principles for all elements of pension provision and an increase in the personal responsibility of the future pensioner for the accumulation of pension contributions.

Thus, the Hungarian pension system combines the principles of pay-as-you-go and funded systems and includes three elements: basic pensions paid as part of social insurance, based on the principle: one year of work experience - 1% of the pension paid; compulsory pension insurance, involving the deduction of 8% of earnings; voluntary pension insurance in about 250 non-state pension funds.

Hungarian tourism

One of the fastest growing sectors of the Hungarian economy is tourism. Tourist infrastructure (hotels, catering points, beach, health and entertainment complexes, swimming pools, hunting lodges, fishing spots, etc.) is aimed at visitors with different incomes. In recent years, the state has allocated for the development of resort tourism 29.3 billion for. (120 million euros). In addition, the state has announced tenders for the construction of thermal spas and health centers. In addition to building permits, private firms received subsidies and, adding their own funds of HUF 39.7 billion to the subsidies, invested a total of HUF 89 billion. in the construction of 11 new hotels and the modernization of 13 hotels.

Hungary annually receives from 10 to 30 million foreign tourists. Foreign exchange earnings from tourism is about 3.4 billion dollars a year. The increase in the number of foreign tourists visiting Hungary is primarily due to the appearance of cheap "discount" Western airlines on the Hungarian air transportation market, as well as an increase in the level of services, the development of natural, architectural, and health-improving facilities. Romania ranks first in terms of the number of foreign citizens visiting Hungary, followed by Slovakia, Austria, Serbia and Montenegro, Germany and Ukraine. In addition, the influx of tourists from Asia (by 22.6%) and America increased.

national income. In the 1980s, Hungary was the only country in the Soviet bloc (with the exception of Romania) that published national income statistics that corresponded to generally accepted world statistics. In 1980, Hungary's gross domestic product (GDP) - the value of goods and services produced within the country - was approximately the equivalent of $20 billion, or about $2,000 per capita. In the late 1980s, GDP began to stagnate, and during the transitional period of the 1990s, the volume of gross domestic product began to decrease in the economy. In 1991, GDP was 11.9% below its 1990 level. By 1996, Hungary's gross national product had increased to the equivalent of $75 billion (or $7,500 per person).

In 2003, Hungary's GDP was $139.8 trillion, or $13,900 per capita.

Labor resources. In the post-war period, the main structural change in the system of labor resources was the flow of labor from agriculture (in which in 1949 more than half of all employed people in the country worked) to industry. Between 1949 and 1983, the number of people employed in mining and manufacturing increased to 857,000, while in agriculture it decreased to 1,113,000. The number of employees registered in 1992 was distributed as follows: 29% in industry; 15% in healthcare, social infrastructure and culture; 14% - in agriculture and forestry; 13% - in trade; and 9% in transport and telecommunications. Another important change in the structure of employment was the increase in the share of women; in 1949 they were only 25% of the employed, but in 1994 the figure was 52.8%. The corresponding trend slowed down somewhat in the second half of the 1990s, as a result, the share of women in the number of employees decreased to 49.8%.

The transition to capitalism in the early 1990s caused a sharp increase in the unemployment rate: the number of registered unemployed people increased from 79,521 people in 1990 to 657,331 people at the end of 1993. However, starting from 1994, the unemployment rate began to slowly decrease and reached 10% at the end of 1998.

Agriculture. 70% of the territory of Hungary is occupied by agricultural land. Forests cover 17% of the territory. The main agricultural regions of the country are located on the plains of the central and eastern parts of Hungary.

During the post-communist period beginning in 1990, the government undertook a massive program of agricultural restructuring and privatization. The landowners were given back their property, many cooperatives were dissolved and their lands were privatized. It was not about going back to the old smallholder agriculture; the move to a mixed system of private and family farms, land associations and reorganized cooperatives based on shared ownership and market-oriented production seemed sensible. Already in 1995, only about 30.6% of suitable land was cultivated by cooperatives, 17.6% was in state ownership, the rest of the land belonged to private individuals and enterprises.

Despite a severe drought in the early 1990s and the difficulties associated with the transition to a market economy, agricultural products continued to be an important export item. In 1992, about 16.5% of GDP came from agriculture, but production of major crops declined as attempts to develop new markets and new farming methods led to an inevitable temporary decline.

In 1997, Hungary processed 717,000 tons of grapes, of which 612 tons were used to make wine. Wine production in 1997 amounted to 394 million liters, about a quarter of which is exported.

At the same time, the number of livestock, especially the number of pigs, increased significantly. In 1997 Hungary had 4.93 million pigs, 871,000 cattle, 858,000 million sheep and 31 million poultry.

Fish farm. Fish ponds supplied with fry from hatcheries occupy more than 25,300 ha, i.e. 0.3% of the entire territory of the country. Fish for commercial purposes is also caught in the Danube and Lake Balaton. In 1992, the total catch of fish, primarily carps, was 20,000 tons.

Forestry. Hungary gradually restored its forests, which in 1998 covered an area of more than 1.6 million hectares, i.e. 17% of the entire territory of the country. Every year the country imports a large amount of timber.

Mining industry. Hungary has very limited mineral resources. The only mineral found in significant quantities is bauxite mined near Lake Balaton. In 1983, Hungary was the world's seventh largest producer of bauxite, producing 2.9 million tons. However, by the end of the 1990s, many mines were closed, and bauxite production was reduced to about 1 million tons - compared to 1.7 million tons. tons in 1992. Near Pecs and Komlo in the southwest there are small reserves of low-grade anthracite, and in the Budapest area there are large deposits of brown coal (lignite). In 1985 Hungary produced 2.6 million tons of anthracite and 21.4 million tons of brown coal; in 1991 their production was reduced to 1.6 million tons of anthracite and 15.3 million tons of brown coal. Iron ore deposits are located in the Miskolc region (in the northeast). Hungary produces small amounts of oil and natural gas from wells in the Szeged Basin and the Zala region in the country's southwest. In 1998, 3.5 million tons of oil and 4.7 billion cubic meters were produced here. m of natural gas. Hungary has uranium ore, but all information about its extraction is classified.

Energy. In 1997, of the total amount of energy consumed (1055 petajoules), about 69.3% of it was obtained from hydrocarbon sources, 12.6% from coal, 10.1% from nuclear energy, 7% from exported electricity, 1.0% from wood.

In 1997 Hungary consumed 37,215 megawatt hours of electricity, 93% of which was produced in the country. In 1983, a nuclear power plant went into operation at Pakse, on the Danube, south of Budapest. The 4 reactors at Pakse produced 13,968 megawatts of electricity in 1997, providing approximately 38% of the country's energy consumption as a whole.

Manufacturing industry. Until the 1970s, successive Five-Year Plans channeled much of the investment into heavy industry, especially into those industries that produce iron and steel, industrial equipment, trucks and buses, cement, and chemicals. After the introduction of the New Economic Mechanism in 1968, greater attention began to be paid to the development of the food industry - the main source of export sales in the capitalist markets - and the production of computers, precision engineering products, scientific research instruments, industrial and consumer electronics, pharmaceutical products, communications equipment and consumer electronics. goods. Although most Hungarian factories were so outdated and inefficient that their products could only find export markets within the Soviet bloc, Hungary by the mid-1980s had developed modern, highly skilled industries that allowed it to enter international markets.

Although more than one-fifth of Hungary's national income came from manufacturing, heavy industry was in deep crisis by the early 1990s due to high production costs, limited mineral resources, and outdated machinery and equipment. Key industrial complexes in Debrecen and Győr continued to operate, but in traditional iron and steel centers like Dunaujváros and Miskolc, unemployment soared.

Transport. Budapest is the central hub of the Hungarian transport system, which in 1995 included 1,576 km of navigable waterways, 69,957 km of roads and 7,635 km of railways (1998), of which about 29% were electrified. Budapest airports Ferihegy 1 and Ferihegy 2 serve both domestic and international airlines.

In the 1950s, almost 80% of all cargo was transported by rail, and only 13% by cars. By 1992, only about 41% of all cargo was transported by rail and 40% by road. However, rail transport continued to carry the bulk of long-distance cargo. Water transport is especially important for the transport of heavy goods such as iron ore and coal. Except during the coldest part of winter, the Danube is navigable throughout its entire length in Hungary, and the Tisza as far as Szolnok.

Internal trade and services. From the end of World War II until the fall of communism, all wholesale and almost all retail trade was carried out by state-owned firms. In 1989 almost 40,000 retail and food outlets were privately owned. In 1992, their number reached 111,513, and by 1997 - 152,000 (two-thirds of all stores).

By 1997, more than four-fifths of the officially registered service market was occupied by private firms.

Foreign trade and payments. Before World War II, Hungary traded predominantly with European countries, with the Soviet Union accounting for less than 1% of its trade. In the first decade after the communists came to power, about 90% of Hungary's foreign trade was with the countries of the Soviet bloc. The main exports were heavy industry equipment, ships, locomotives and transport equipment, chemicals, textiles, petroleum and oil products, ores and products; imports - machine tools, agricultural equipment, coke, iron, cotton, wool and wood. After 1958 Hungary expanded trade with the West and third world countries. By 1982, the countries of the Soviet bloc accounted for 55.2% of foreign trade.

In the 1980s, West Germany became Hungary's main trading partner outside the Soviet bloc. In 1992, Germany accounted for 23.5% of imports and 27.7% of exports; to the successor countries of the former Soviet Union - 16.9% of imports and 13.1% of exports. Other important trading partners in the early 1990s were Austria and Italy. Business relations with the USA developed, although the volume of trade was not so significant (2.9% of imports and 3.2% of exports).

In 1995, Hungary's total foreign trade was $28 billion. Exports reached $13 billion and imports $15 billion. iron and steel. The main imports are oil and oil products, natural gas, textiles and textile products, iron and steel, machinery, vehicles and spare parts for them.

Until the early 1970s, exports and imports were balanced. However, during the 1970s, import costs, especially oil, grew much faster than export earnings. Already in 1981, Hungary had to export 25% more goods to cover the volume of imports. The result was a serious trade deficit, which was covered by foreign loans. They were obtained almost entirely from Western banks and the International Monetary Fund, which led to an increase in Hungary's debt from less than $1 million in 1970 to $25.5 billion in 1997.

Tourism. In the 1950s, most tourists came from other countries of the Soviet bloc, but in the 1960s, Hungary began to encourage the arrival of tourists from Western countries. The number of such tourists increased from 244,000 in 1960 to 37.6 million in 1990 and to 40 million in 1996.

Hungary is the eighth most attractive country in the world. Hungary has a number of resorts that are equipped with modern physiotherapy facilities, and Lake Balaton, with its hotels and a wide range of recreational facilities, enjoys the greatest attention of tourists. The largest number of tourists come from Romania (mainly because there is a significant ethnic Hungarian minority), Germany, Austria, Yugoslavia and the republics of the former Yugoslavia. The number of tourists from America reached 390,000 in 1996. In 1996 and 1997, annual tourism revenues were $2.2 billion and $2.6 billion, respectively.

Currency and banking. The monetary unit is the forint. Until 1976, the forint had several parallel exchange rates. One rate was set for "hard" currencies that could be used to purchase goods in the West; this was the so-called "foreign" exchange rate. The non-commercial rate was used for tourism and money transfers from abroad, and the commercial rate was used in foreign trade and accounted for half of the non-commercial rate. In 1976 the foreign exchange rate was abolished, and in 1981 the non-commercial and commercial rates were merged.

In the mid-1990s, most of Hungary's large banks were state-owned. The National Bank is central to the management of the Hungarian economy. In addition to its own banking functions - issuing money and setting the interest rate, it manages the commercial banking business, accepts deposits, provides loans to corporations and cooperatives for investment and working capital, and also deals with foreign trade transactions. Many banks accept major credit cards, but most consumer transactions in Hungary are done with cash. Hungary's foreign exchange reserve in 1998 was $8.8 billion.

Public finances. The state budget still has a predominant influence on the economy. In 1998, central government spending was 56% of the official gross national product (GNP). The budget deficit in 1998 was 2.9% of GNP, falling sharply to this figure (from 8.4%) in 1994. One of the main goals of the Bokrosh program is the elimination of the budget deficit.

The largest part of government spending, about 40% in 1997, goes to subsidies to budget organizations. Approximately 24% is allocated to social insurance and relief programs, 27% to debt service and interest payments, and 8.4% is spent on subsidies to state enterprises, agriculture, and consumer price support. Tax revenues are approximately 14% from the income tax of state and cooperative enterprises, 37.4% from taxes on individual consumption (additional taxation of luxury goods, excise duties), 18.2% from family payments (taxation of personal property, social insurance, etc. .d.), 13.9% from payments of budgetary organizations, 9% from receipts from the payment of capital debt and interest on public debt, and 7.5% from taxes on privatization.