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The Hungarian Government Announces the Closure of Several Foreign Trade Offices

Gábor Sarnyai 2018.07.27.
Hungarian Foreign Trade Offices

The Hungarian government has decided to close several foreign trade offices. The state-owned enterprises struggled to generate profits and have shrunk to a small network of five offices around the world.

Magyar Nemzeti Kereskedőház Zrt. maintained contracts with 41 countries and even had more than one office in a few of them. The most closures were made in Africa and South America. The Hungarian foreign trade policy had two waves: The Eastern and Southern opening. It seems the second wave of the policy did not produce the expected results.

Magyar Nemzeti Kereskedőház Zrt. will merge with Magyar Kereskedelemfejlesztési és Promóciós Kft. to become the HEPA Hungarian Export Development Agency Nonprofit Zrt. The recently closed trading house lost 10 billion HUF (34 million EUR) over the years. According to the government, the office’s services are primarily non-profit due to the provision of support for the SME sector, and the real value is generated by tax revenues when Hungarian products go to international markets.

According to a vague statement issued by the Ministry of Foreign Affairs, under the direction of the new company – following international trends – a smaller number of Export Development and Promotional Centers will be established.

The trading house has been controversial since its inception. In 2015, Magyar Nemzeti Kereskedőház Zrt. was involved in the Quaestor scandal for taking billions of forints from the insurance company prior to its bankruptcy. Many blamed the government founded offices for the acceleration of Questor’s bankruptcy, and critics argued that the government shouldn’t invest in these types of financial companies. In the same year, MNKH’s account saw a huge 6 billion forint loss – later paid back by a company related to Lőric Mészáros.

Via: Hir24