Economy of Hungary

Economy of Hungary

NN headquarters in Budapest Danube towers in Budapest'S CBD Gedeon Richter R&D centre Budapest Stock Exchange Budapest, the R&D and financial center of Hungary
Currency	Hungarian forint (HUF)
Fiscal year	Calendar year
Trade organisations	European Union, OECD, AIIB and WTO
Country group	Developing country[1] High-income economy[2]
Statistics
Population	9,994,993 (2024)[3]
GDP	$223 billion (nominal, 2024)[4] $438 billion (PPP, 2024)[4]
GDP rank	56th (nominal, 2024) 53rd (PPP, 2024)
GDP growth	4.6% (2022) −0.9% (2023) 2.2% (2024)[4]
GDP per capita	$23,319 (nominal, 2024)[4] $45,692 (PPP, 2024)[4]
GDP per capita rank	48th (nominal, 2024) 43rd (PPP, 2024)
GDP by sector	agriculture: 3.9% industry: 31.3% services: 64.8% (2017)[5]
Inflation (CPI)	17.1% (2023)[4] 5.20% (2024)[6]
Base borrowing rate	0.90%[7]
Population below poverty line	12.3% in poverty (2018)[8] 19.7% at risk of poverty or social exclusion (AROPE 2023)[9]
Gini coefficient	29.0 low (2023)[10]
Human Development Index	0.851 very high (2022)[11] (47th) 0.800 very high IHDI (36th) (2022)[11]
Corruption Perceptions Index	42 out of 100 points (2023)[12] (76th)
Labour force	4,715,000 (2020)[13] 80.7% employment rate (2023)[14]
Labour force by occupation	Services: 64.8% Industry: 21.4% Construction: 6.5% Agriculture: 4.8% Other: 2.7% (2016)[15]
Unemployment	7.8% (September 2021)[16] 15.0% youth unemployment (15 to 24 year-olds; September 2021)[17]
Average gross salary	€1,456 per month
Average net salary	€1,002 per month
Main industries	mining, metallurgy, construction materials, food processing, electronics, textiles, chemicals, pharmaceuticals, motor vehicles, information technology
External
Exports	$125.75 billion (2017)[18]
Export goods	machinery and equipment: 53.5% other manufactures: 31.2% food products: 8.7% fuels and electricity: 3.9% raw materials: 3.4% (2012)
Main export partners	Germany 27.7% Romania 5.4% Italy 5.1% Austria 5% Slovakia 4.8% France 4.4% Czech Republic 4.4% Poland 4.3% (2017)[5]
Imports	$115.63 billion (2017)[18]
Import goods	machinery and equipment: 45.4% other manufactures: 34.3% fuels and electricity: 12.6% food products: 5.3% raw materials: 2.5% (2012)
Main import partners	Germany 26.2% Austria 6.3% China 5.9% Poland 5.5% Slovakia 5.3% Netherlands 5% Czech Republic 4.8% Italy 4.7% France 4% (2017)[5]
FDI stock	$290 billion (31 December 2017 est.)[5] Abroad: $212 billion (31 December 2017 est.)[5]
Current account	$4.39 billion (2017 est.)[5]
Gross external debt	$138.1 billion (31 December 2017 est.)[5]
Public finances
Government debt	66.3% of GDP (2019)[19] HUF 31.040 trillion (2019)[19]
Budget balance	HUF 958.1 billion deficit (2019)[19] −2.0% of GDP (2019)[19]
Revenues	44.0% of GDP (2019)[19]
Expenses	46.1% of GDP (2019)[19]
Economic aid	€25.3 billion from European Structural and Investment Funds (2007–2013)[20] €25 billion from European Structural and Investment Funds (2014–2020)[21]
Credit rating	Standard & Poor's:[22] BBB Outlook: Stable Moody's:[23] Baa3 Outlook: Stable Fitch:[24] BBB Outlook: Stable Scope:[25] BBB Outlook: Stable
Foreign reserves	$28 billion (31 December 2017 est.)[5]
All values, unless otherwise stated, are in US dollars.

The economy of Hungary is a developing,^[1] high-income mixed economy, ranked as the 9th most complex economy according to the Economic Complexity Index.^[26] Hungary is a member of the Organisation for Economic Co-operation and Development (OECD) with a very high human development index and a skilled labour force, with the 22nd lowest income inequality by Gini index in the world. The Hungarian economy is the 53rd-largest economy in the world (out of 188 countries measured by IMF) with $265.037 billion annual output,^[27] and ranks 41st in the world in terms of GDP per capita measured by purchasing power parity. Hungary has an export-oriented market economy with a heavy emphasis on foreign trade; thus the country is the 35th largest export economy in the world. The country had more than $100 billion of exports in 2015, with a high trade surplus of $9.003 billion, of which 79% went to the European Union (EU) and 21% was extra-EU trade.^[28] Hungary's productive capacity is more than 80% privately owned, with 39.1% overall taxation, which funds the country's welfare economy. On the expenditure side, household consumption is the main component of GDP and accounts for 50% of its total, followed by gross fixed capital formation with 22% and government expenditure with 20%.^[29]

Hungary continues to be one of the leading nations in Central and Eastern Europe for attracting foreign direct investment: the inward FDI in the country was $119.8 billion in 2015, while Hungary invests more than $50 billion abroad.^[30] As of 2015, the key trading partners of Hungary were Germany, Austria, Romania, Slovakia, France, Italy, Poland and the Czech Republic.^[31] Major industries include food processing, pharmaceuticals, motor vehicles, information technology, chemicals, metallurgy, machinery, electrical goods, and tourism (in 2014 Hungary welcomed 12.1 million international tourists).^[32] Hungary is the largest electronics producer in Central and Eastern Europe. Electronics manufacturing and research are among the main drivers of innovation and economic growth in the country. In the past 20 years Hungary has also grown into a major center for mobile technology, information security, and related hardware research.^[33] The employment rate in the economy was 68.7% in January 2017,^[34] while the employment structure shows the characteristics of post-industrial economies. An estimated 63.2% of the employed workforce work in the service sector, industry contributed by 29.7%, while agriculture employed 7.1%. The unemployment rate was 3.8% in September–November 2017,^[35] down from 11% during the Great Recession. Hungary is part of the European Single Market which represents more than 448 million consumers. Several domestic commercial policies are determined by agreements among European Union members and by EU legislation.

Large Hungarian companies are included in the BUX, the Hungarian stock market index listed on Budapest Stock Exchange. Well-known companies include Graphisoft, Magyar Telekom, MKB Bank, MOL Group, Opus Global, OTP Bank, RÁBA Automotive Group, Gedeon Richter and Zwack Unicum. Hungary also has a large number of specialised small and medium enterprises, for example many automotive industry suppliers and technology start ups.^[36]

Budapest is the financial and business capital of Hungary. The capital is a significant economic hub, classified as an Alpha- world city in the study by the Globalization and World Cities Research Network and it is the second fastest-developing urban economy in Europe. The per capita GDP in the city increased by 2.4% and employment by 4.7% compared to the previous year, 2014.^[37][38] On the national level, Budapest is the primary city of Hungary for business, accounting for 39% of the national income. The city had a gross metropolitan product of more than $100 billion in 2015, making it one of the largest regional economies in the European Union.^[39][40] Budapest is also among the Top 100 GDP performing cities in the world, as measured by PricewaterhouseCoopers. In a global city competitiveness ranking by the Economist Intelligence Unit, Budapest is ranked above Tel Aviv, Lisbon, Moscow and Johannesburg, among others.^[41][42]

Hungary maintains its own currency, the Hungarian forint (HUF), although the economy fulfills the Maastricht criteria with the exception of public debt. The ratio of public debt to GDP is significantly below the EU average at 66.4% in 2019. The Hungarian National Bank was founded in 1924, after the dissolution of the Austro-Hungarian Empire. It is currently focusing on price stability, with an inflation target of 3%.^[43]