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Multi-billion Euro Railway Development and Ten-year Road Program Announced

Hungary Today 2024.07.04.

The Minister of Construction and Transport named a series of public investments, writes Világgazdaság. János Lázár announced a comprehensive railway development and a road construction program for the next ten years.

The year 2023 was the black year of the Hungarian construction industry, the minister said in the latest edition of the podcast of the National Federation of Hungarian Building Contractors, Spakli. János Lázár recalled that in the autumn of 2022, the Ministry of Construction and Transport stopped some HUF 5,000 billion (EUR 12.6 billion) of public investment.

Photo via Facebook/Lázár János

Among the consequences, he noted that there have been redundancies in the construction sector, companies have had difficulties and some have been sold. “There was trouble,” he added. However, he seemed to see some consolidation in 2024 in the context of construction inflation falling to 1-2%.

Private investment has picked up, including factory construction. “These represent the light at the end of the tunnel.”

The minister remarked that the state has not got back into the construction industry, even though a third of orders are related to it. That is why the home renovation program is a very important step, which is estimated to generate a turnover of around HUF 200 billion (EUR 507 million). János Lázár stressed that the construction industry can be considered Hungarian, as two out of three sectors are dominated by domestic players.

  • In the trade sector, the Hungarian presence is 80%,
  • in the construction sector it is already 90%,
  • however, 80% of the building materials are in foreign hands.

The sector has become much cleaner, but there is also a need to improve efficiency. Quality has to be improved, as construction companies have been recapitalized. Funds must be reinvested in quality. At this point, the politician added, it is generally true that the building stock in Hungary will need renovation in the next twenty years.

A ten-year program for civil engineering has been drawn up, including motorways, expressways and upgrading the road network. There is a program, with thousands of billions of euros, the question is whether there will be resources. The minister pointed out that the state currently collects around  HUF 600 billion (EUR 1.5 billion) in tolls, which will double to between HUF 1,000 and HUF 1,200 billion (EUR 2.5 and EUR 3 billion). The more expressways there are, the more money the state will make. Hungary is a key state in terms of transport, as it is located on the West-East axis, thus it is worth investing in road construction.

He also announced that

Hungarian railway lines will definitely be renewed. Currently, speed limits are in force for about 3,000-3,500 kilometers of the 6,000 kilometers of the network.

“We are in talks with European investment banks to take out loans and spend billions of euros over the next four years to renew the railway,” he emphasized. “This is being done to eliminate delays.”

Photo via Facebook/Lázár János

In addition, he also announced building projects. János Lázár said that every cycle they start building bridges, and this is the case now. The construction of a new bridge will start, probably at Mohács (southern Hungary), but several crossings are also on the agenda. Finally, he also indicated that symbolic projects will be started. He highlighted the Pázmány Péter Catholic University campus, worth HUF 250-300 billion (EUR 633-760 million). The new center of the institution will be built on 50,000 square meters in Budapest. There will be similar public developments, including gymnasiums and hospital renovations, he underlined.

“The idea is to build better with less money.” This will not happen this year, but will start in the second half of 2025 and throughout 2026: there will certainly be major road, rail and engineering works, the politician noted. Many of Hungary’s 800 bridges are in need of renovation, he said, adding that public housing developments will also start in 175 districts.

He particularly drew the attention of construction contractors to Debrecen (eastern Hungary) and Szeged (southern Hungary). The minister stressed that

Debrecen is being rebuilt, made possible by a gigantic industrial development.

Twenty thousand new jobs are being created and the population could jump by 60,000 in the next few years. Szeged is on a similar path with the arrival of Chinese giant BYD. “The next three to four years will see a big boom, there is life outside Budapest,” he concluded.

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Via Világgazdaság; Featured image via Facebook/Dömötör Csaba

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