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Industrial output in Hungary grew by an annual 5.8 percent in December, based on adjusted data, and by 9.6 percent in the full year of 2021, the Central Statistical Office (KSH) said in its first estimate on Friday.
According to unadjusted data, output increased by 3.6 percent in December.
Month on month, it fell by 0.1 percent, according to seasonally and working-day adjusted data.
Output fell heavily in vehicle production, while the computer, electronics, optical products and food, beverages and tobacco segments saw big increases.
László György, state secretary at the innovation and technology ministry, said industry had made a major contribution to Hungarian economic growth. He noted automotive as the dominant sector, adding that Hungary was in the forefront of the industry’s renewal.
While traditional vehicle making has lagged due to a global shortage of semiconductors, Hungary’s production of electronic equipment produced “two-digit growth”, he told public broadcaster M1. Hungary is “doing extremely well” in battery production and in industries linked to electro-mobility and self-driving cars, he added.
Analysts told MTI that the full-year figure for last year was tied up with base effects, adding that a positive development, however, was that the downturn in the automotive sector had been offset by the strong performance in other sectors.
Gergely Suppan of Takarékbank said the December figure was higher than expected. Whereas chip shortages continue to weigh on vehicle production, other sectors went some way towards making up for it. Without the chip shortages, output may have topped current levels by 6-8 percent, he said, adding that automotive output in the coming months may return to growth as a gradual improvement is likely in the supply of semiconductors. Takarékbank anticipates 5.5 percent growth in industrial output this year on base effects and the commissioning of new capacities, he said.
Péter Virovácz of ING Bank highlighted the solid performance of the electronics industry, the second largest industrial sector. But since the impact on the headline figure in December was minimal, it suggested the decline in automotive output may have been even greater than anticipated. Last year’s 9.6 percent growth was on the back of a low base in 2020 rather than a healthy increase in 2021, he noted.
Gábor Regős of pro-government Századvég said positive data for December augured well for 2022, though there was a risk that a shortage of raw materials affecting vehicle production and, to a lesser extent, other sectors, as well as transport problems, could delay economic growth this year, he added.
Featured photo by János Vajda/MTI