Foreign firms, at 3.3%, employ 25%
Only 3.3 per cent of companies operating in Hungary are foreign-owned, yet the multinationals employ a quarter of all workers in the private sector and account for half of all investments and revenue.
The latest figures from the Central Statistical Office reveals that around 20 per cent of full-time employees work at fully-foreign owned companies and an additional 5.7 per cent labour for firms whose domestic ownership is less than 50 per cent.
The business daily Napi Gazdaság notes that the IT segment is the most foreign in terms of revenue, with 2.7 per cent of income going to firms that are majority Hungarian-owned. The computing industry is followed by the automotive segment (5.8 per cent), telecommunications, and the tobacco racket. Hungarian companies dominate the water and waste management industry, banking 85 per cent of revenue in the sector. In the construction game, similarly, local outfits pocket three forints out of every four.
Firms from about a hundred countries have a presence in Hungary, with 61.4 per cent of local subsidiaries owned by an entity based in the European Union. Austria alone accounts for 15 per cent of foreign firms operating in Hungary, and Germany is not far behind at 14.4 per cent, although as some of these firms are huge, Germany is by far the most important foreign investor. Among the non-EU countries the United States has the biggest share in Hungary, followed by Japan, the latter mainly present in the automotive and electronics segments.
Low tax lures firms
Ever more Slovak firms are moving their headquarters to Hungary to take advantage of lower corporate tax rates, Napi Gazdaság reported this week citing the Slovak daily Hospodárské Noviny. In the first half of the year, 680 Slovak firms relocated or entered partnerships with Hungarian companies. A further 150 Czech firms did the same. In recent years, Hungarian firms moved north to avail themselves of Slovakia’s 19 per cent flat tax regime. Under recent changes, however, Viktor Orbán’s centre-right government cut corporate tax on firms with a turnover of less than HUF 500 million to a preferential rate of 10 per cent.
Krause off to Turkey
Frank Krause, the Chief Finance Officer of Vodafone Hungary will leave the Hungarian branch of the telecommunications company to continue his career in the same position at the Turkish affiliate as of 1 September, the British-owned company announced on Tuesday, noting that his successor will be announced in due course. “In his position as Chief Finance Officer, Frank Krause did a lot to make the company successful in the past three years, a period full of challenges,” said Vodafone Hungary CEO Diego Massidda. Krause – who will join Vodafone Turkey effective of 1 September, 2012 – has been with Vodafone for a long time. Before the three years he has spent at Vodafone Hungary, he was Director of Controlling and Branches at Vodafone Germany, Head of Controlling at Arcor Germany, Department Head of Planning and Reporting at Vodafone D2 and Financial Controller at Mannesmann Mobilfunk Germany.
Audi motoring
The Audi Hungária factory in Gyõr produced its millionth engine in the first half of 2012, when output was up over 10 per cent compared to the same period last year. In a statement sent to state news agency MTI, Audi said it has invested EUR 300 million and hired 1,000 workers so far this year.
Erste Bank suffers
Erste Group, one of the largest banking and financial services providers in Central and Eastern Europe, posted a EUR 453.6 million net profit in the first half of 2012. Its Hungarian affiliate closed H1 EUR 72.7 million in the red, which the firm puts down to the bank tax and a government scheme allowing borrowers to pay off foreign currency mortgages at a preferential exchange rate.
Slovakia wants war crimes suspect
ustice minister Tomas Borec announced on Monday that Slovakia intends to request the extradition of the Hungarian war crimes suspect László Csatáry. Documents pertaining to a post-war trial in what was then Czechoslovakia have been handed to the regional court of Kosice, where Csatáry was in charge of a transit camp during the Second World War. Csatáry, who protests his innocence, was sentenced to death in absentia by a Czechoslovak court in 1948.
The former police commander, who tops the Nazi-hunting Wiesenthal Center’s “most wanted” list, has been under house arrest since mid-July. He is being questioned over his role in the transportation in 1941 of 300 Jews to Kamyanets-Podilsky, the scene of the Holocaust’s first five-digit massacre, and thousands more to Auschwitz in 1944. The 97-year old had apparently lived freely in Hungary since 1997 until his arrest following an exposé by the UK tabloid, The Sun.
Csatáry, who denied allegations of complicity in the Holocaust during a hearing on Tuesday, had already been sentenced to death in absentia by a Czechoslovak court following a one-day trial in 1948. By then, however, he had fled the country. He settled in Canada in the 1950s, where he remained until the mid-90s when his citizenship application was found to contain false data.
The Slovak justice minister Borec said he would aim for a new procedure to be launched against Csatáry. This is one of the last chances to punish war crimes committed during the Second World War,” he said. The municipal court of Budapest’s decision on whether to extradite is dependant on the issuing of a European arrest warrant, the Hungarian Justice Ministry said on Monday.
New red star case
Demonstrators who were arrested last week for displaying the red star, symbol of the erstwhile communist regime (and still part of the Heineken logo) say they are taking their case to the European Court of Human Rights. Among them was Attila Vajnai, head of the fringe communist outfit Workers Party 2006. Vajnai recently won a similar case in the ECHR, which ordered the government to compensate him. The government refused to recognise that ruling and maintained the law banning the red star along with symbols of fascist tyranny, but agreed to pay EUR 6,400 in compensation and costs.
Jobbik wants “Jewish” MEP’s seat
The far-right Jobbik party’s national executive was unanimous on Monday in its call for MEP Csanád Szegedi to hand over the European Parliament seat he won via the party’s list in 2009. Szegedi had resigned the previous Friday amid revelations that he had hushed up his Jewish ancestry.
Party leader Gábor Vona said the decision was not because Szegedi is of Jewish descent, but because he attempted to cover up the fact by offering bribes. If Szegedi does not stand down, the party may strip him of his membership, Vona said. That would not, however, prevent him from holding on to his job in Brussels. Szegedi is notorious for advocating the internment of Hungarian Roma in concentration camps and wearing the uniform of the Jobbik’s outlawed “Hungarian Guard” to work in Brussels.
Rabbi warns of antisemitism
Hungary’s chief rabbi Róbert Frölich warned against the revival of “familiar” antisemitic and anti-Roma remarks and slogans during a ceremony commemorating Roma victims of the Holocaust in Nagykanizsa on Monday. László Teleki, head of the local Roma community that organised the commemoration, said 3,000 Roma people were executed in the Auschwitz-Birkenau concentration camp on the night of 2-3 August. Frölich spoke of the genocide as an inevitable climax to a “relentlessly logical system evolving from laws, decrees and newspaper articles”. “Seventy years ago Hungary labelled some of its own citizens second-rate, stigmatised, to be exterminated, and did its best to execute that verdict”, he added. Teleki warned that the wave of openly made, far right antisemitic and anti-Roma expressions currently sweeping Hungary should not be allowed. “We know where it all leads to”, Frölich also said. Nagykanizsa has been home to a monument commemorating the Roma Holocaust since 1991.
Jobbik wants prosecutor in dock
The far-right party Jobbik and an association of former political prisoners has called for the arrest of György Mátszik, a former communist apparatchik who advocated the death penalty for Hungarian rebels in the wake of the Soviet Union’s suppression of the 1956 Uprising. Jobbik MP György Szilágyi said Mátszik, then a prosecutor, had sought the death penalty for the teenage freedom fighter Péter Mansfeld who was held in prison for two years until, at 18, he was old enough to be sentenced to death. Jobbik is also lobbying for the prosecution of the then interior minister Béla Biszku.
Gov’t ready for IMF compromise
The government’s chief IMF negotiator Mihály Varga said last Friday that Hungary was prepared to compromise on a new financial transaction tax seen as a likely obstacle to the EUR 15 billion pre-emptive bail-out Hungary is seeking. “”We have to see the European Commission’s stance on that”, he said, in reference to a review of the legislation by the EU’s executive. Earlier in the day, PM Viktor Orbán had complained in his weekly radio broadcast that “the IMF objects to everything that we consider to be a fair sharing of public burdens.”
A drop in the ocean
The “Unite Against National Debt” fund, which asks Hungarians to donate money to pay off Hungary’s creditors, has swollen to HUF 238.4 million (EUR 850,000) since it was set up a year ago, ATV reported this week. At this rate it will only take 88,000 years to clear Hungary’s government debt of roughly HUF 21 trillion. The independent TV station asked actor Károly Eperjés, who sits on the board of the fund, for comment. “No, no, thank you, thank you, thank you, all the best,” Eperjés said.
So far only a few other figures sympathetic to the ruling Fidesz party have joined government politicians publicly donating significant sums to the kitty. The Fidesz-Christian Democrat MEP László Surján donated HUF 4 million, Fidesz spokeswoman Gabriella Selmeczi HUF 2 million, and former president Pál Schmitt managed a month’s salary of HUF 1.5 million before he resigned over an academic fraud scandal. Economy Minister György Matolcsy apparently pays a “certain amount” of his salary into the fund every month. Prime Minister Viktor Orbán has not indicated whether or not he paid into the fund.
An attempt in February to boost the fund through benefit concerts in Budapest and Gyõr ended in farce. Only a handful of people turned up to watch Hungarian pop stars and graduates of local X-Factor type shows belt out crowd pleasers, despite tickets costing only HUF 2,012 and kids getting free entry. The precise sum raised was not made public.
City seeks to lighten lighting bill
Budapest’s street lamps are being switched on later than usual as the City Council tries to cut its electricity bill by HUF 66 million in the second half of the year, the news website index.hu reported on Tuesday. Numerous readers had written to complain that lights were only coming on at near pitch darkness. A web gallery of photos taken on Monday suggests that lights only came on at 21:53, half an hour after sun down and well after the Buda Hills cast their shadow across the Danube
Law will require voter registration
Hungarians will have to register in advance if they want to participate in the 2014 elections, Prime Minister Viktor Orbán said during his customary weekly radio address last Friday. Opposition parties were unanimous in perceiving a government bid to improve its chances in the ballot.
The prime minister knows that elections are decided by floating voters who are disappointed with the government, the Democratic Coalition party of former premier Ferenc Gyurcsány said in a statement. “Orbán also knows that he has lost their support and will not win it back. That is why he wants to keep them away from the ballot boxes in 2014,” the opposition party said.
Romanian PM slams Orbán’s “meddling”
Harsh words have once more crossed the border between Hungary and its southern neighbour as Romanian Prime Minister Victor Ponta accused his counterpart Viktor Orbán of meddling in the domestic affairs of another country. Ponta was referring to a speech Orbán made last Saturday in Baile Tusnad (Romania) in which he called for Transylvania’s ethnic Hungarians not to participate in the Romanian referendum to be held on the following day.
At stake in the referendum was the fate of Romanian president Traian Basescu, whom Parliament suspended from office on 6 July for allegedly acting beyond his constitutional powers. Voter turnout of over 50 per cent was necessary for the referendum to be valid, but the eventual turnout of 46.23 per cent means Basescu should be re-instated as president.
The outcome of the referendum is a setback for Ponta, whose left-wing coalition has been seeking to oust the centre-right president as part of a general overhaul of Romanian politics. He has nonetheless warned that cooperation with Basescu until this autumn’s parliamentary elections would be uneasy, as he “no longer has legitimacy”.
Basescu’s own Democratic Liberal Party opted for a boycott of the referendum as the best bet to save the president, whose popularity has plummeted owing to the introduction of harsh austerity measures in recent years.
Of those who did turn out to vote, an overwhelming majority of 87 per cent rejected Basescu.
Central election office figures show turnout to have been particularly low in ethnic Hungarian-dominated Covasna and Harghita counties (11.6 and 20.6 per cent respectively). Basescu explicitly expressed his thanks to Hungarians for their role in what he described as a “failed coup”.
The results were interpreted differently by Hungarian actors in and out of Romania. Hungarian foreign affairs state secretary Zsolt Németh said the boycott was to be ascribed to recent developments “suggesting a policy of intimidation” in Romania and noted the improvement in relations between the two countries during Basescu’s two presidencies since 2004. Hunor Kelemen, head of the ethnic Hungarian RMDSZ party, said however that low turnout among ethnic Hungarians rather reflected the absence of a stake for them.
Relations between the two countries soured earlier this year after Romanian authorities refused the go-ahead for a Hungarian initiative to rebury the ashes of ethnic Hungarian writer József Nyirõ, a wartime fascist sympathiser, on Romanian land.
Wayward teen sparks manhunt
Maltese police called off a search for a missing Hungarian teenager on Saturday after she was found alive and well, the Times of Malta reported. An aunt and uncle of 19-year-old Ágnes Révész, last seen a week earlier walking along a seaside promenade, had called the police after she failed to return home. Her mother flew out on Friday, convinced that a Facebook posting in which Ágnes asked to be “left alone” was a fake, and that her daughter had been kidnapped by white slavers.
The uncle, a Malta resident, said the police had informed his family that Ágnes had been found alive and well. “We haven’t seen her, but we’re pleased she is safe and thankful to the police,” he was quoted as saying. His niece was apparently staying with “a man” they have not met. The young woman vanished just a week after the disappearance of Russian Polina Rahman. Fears were heightening when the 17-year-old was found dead the day after Révész was reported missing. Police believe Rahman, who had been in Malta for a two-week English course, tripped and fell from a cliff.
Eating more greens
Hungarian households purchased 6 per cent more fruit and vegetables in 2011 than during the previous year, a study published on Tuesday by researcher GfK Hungária revealed. The most popular vegetable was the potato, accounting for 30 per cent of all purchases, while the most popular fruit was the apple.
