The economy takes a step back – optimism didn’t last

By: trademagazin Date: 2015. 01. 08. 10:25

The autumn is expected to bring a negative turn in the economy, due to changes in taxation and the 2015 budget. Growth rate will probably be around 2.5 percent in the second half of 2014 and 2 percent in 2015 – reports GKI Economic Research Zrt. Political crisis situations all over the world and close to Hungary have negative influence on world economy. There will be a reduction in the funding we receive from the European Union, and by 2015-16 it is quite likely that the level of investment will drop in Hungary. Calculated as a percentage of the GDP, Hungary targets a 2.4-percent budget deficit for 2015. In 2013 net EUR 1 billion working capital came to Hungary, but if we deduct the safety-purpose EUR 1.9 billion received by the bank sector, there was actually a capital outflow. What is more, it is increasingly expensive to bring investment into Hungary, as it is well indicated by the case of the Apollo tyre factory: after every new employee the company receives HUF 30 million in subsidies, 3-4 times more than earlier. All the news about corruption in Hungary will also result in more cautious investor behaviour and it may also become more difficult to access EU funding.