While GDP was positively affected by the combined performance of services, the economy's performance was held back by industry and construction.Continue reading
Based on data from the Hungarian Central Statistical Office (KSH), industrial production in March 2025, remained at the same level as in the same month of the previous year, while adjusted for working-day effects, it was 5.4% lower than a year earlier. On the basis of seasonally and working-day adjusted data, industrial output was 0.1 percent higher than in February 2025, the Ministry for National Economy quoted the latest figures in a statement on Thursday.
Among the most important sub-sectors, the manufacture of transport equipment, computer, electronic, and optical products, and food, beverages, and tobacco products expanded compared to the same period in 2024, the ministry said. They noted that the performance of domestic industry continues to be dragged down by negative external factors: “The weakness of our foreign markets, especially the prolonged crisis in Germany, is limiting the performance of the export-driven Hungarian economy, including industry.”
“The European Union has been pursuing a misguided economic policy for a long time, while giving all available money to Ukraine,” they added. The ministry stressed that they are constantly working to achieve the highest possible economic growth despite these negative factors.
To this end, the government has announced the ‘100 new factories‘ program, that since then grew to 150, thus ensuring a boost to domestic industry and investment activity,”
reads the statement.
The program will play a significant role in boosting the economy’s performance while supporting domestic businesses and job creation. In addition, Germany’s €500 billion infrastructure investment program and the country’s fiscal easing could lead to increased external demand for the Hungarian economy.
The statement also points out that the government will give priority to supporting micro, small, and medium-sized enterprises (SMEs) in Hungary through the 21-measure New Economic Policy Action Plan. The Demján Sándor Program provides HUF 1,400 billion (EUR 3.5 billion) in funding, including non-reimbursable grants, soft loans, and a HUF 100 billion capital program to help Hungarian SMEs improve their productivity, thus contributing to the strengthening of Hungarian industry.
To boost investment, the government has launched the “1+1 Investment Incentive” program, providing a total of HUF 50 billion (EUR 123 million) in non-reimbursable funds to support investment by Hungarian SMEs.
In the first evaluation phase of the program, nearly HUF 28 billion (EUR 690 million) will be allocated to 300 companies. “We will firstly support enterprises operating in the least developed regions of the country (Northern Great Plain, northern Hungary, Southern Great Plain and Southern Transdanubia), as it is very important that investment promotion and rural development go hand in hand,” the statement explains.
In addition to the recovery of external markets, large-scale investments such as the expansion of production capacities at CATL, BYD, BMW, SEMCORP, and EcoPro could provide a new boost to Hungarian industry,
they added. Moreover, the domestic industry is supported by strengthening domestic demand and positive trends in the domestic economy: employment remains high, with nearly 4.7 million people in work, while the number of registered jobseekers is at a record low. Real wages have been rising dynamically for 1.5 years, and domestic tourism is set to post another record year in 2025, following its record performance in 2024, the ministry concluded.
Via MTI, Featured image: Pixabay