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Hungary-Germany economic ties on the upswing despite crises

The confidence of German investors in the Hungarian economy is unbroken, according to the Hungarian Investment Promotion Agency (HIPA) and the German-Hungarian Chamber of Industry and Commerce (DUIHK), the ministry of foreign affairs and trade said on Friday.

In a year-end review of Hungarian-German economic relations, the HIPA and the DUIHK concluded that bilateral economic cooperation had notable success stories “even in these times of crisis”, the ministry said in a statement.

Not only is the bilateral trade turnover set to see a new record this year, but German investor activity on projects managed by the HIPA was also strong as usual, the ministry said.

German businesses make up the largest investor community in Hungary today, accounting for 21 percent of total foreign direct investment, according to 2021 central bank figures.

The HIPA successfully concluded negotiations in 171 German investment projects between 2014 and the first half of 2022, bringing a total of 7.86 billion euros and 32,000 jobs to Hungary, the ministry said. It is therefore unsurprising that more than 2,700 German companies employ some 225,000 people in the country, it added.

Bilateral trade turnover in the first nine months of the year increased by 12.7 percent, the statement said, adding that there was a good chance for the full-year turnover to exceed 60 billion euros for the first time.

Detailing this year’s success stories, the ministry noted that BMW had laid the cornerstone of its 2 billion plant in Debrecen, in eastern Hungary. Mercedes-Benz announced the investment of 1 billion euros in its plant in Kecskemet, in central Hungary, while Audi opened its new tool plant in Gyor, in the northwest.

Andras Savos, the president of DUIHK, said Hungary was strategically important to several German businesses as either a purchasing or sales market or a production venue. He pointed out that in recent years, the majority of German investments were upgrade and expansion projects.

The ministry noted that DUIHK marks its 30th anniversary next year.

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