Decline of investments

In the second quarter of 2008 the volume of investments in the national economy – on the basis of preliminary data – decreased by 2.1% compared to the same period of the previous year.

 The value of investments came to HUF
1026.5 billion at current prices. Investments in the national economy – according to seasonally
adjusted volume indices – expanded by 1.1% compared to the previous quarter. In the first half of
2008 a total of HUF 1835.5 billion was spent on investments,3.3% less in volume than in the same
period of 2007.

Within the decline of investments in
the national economy in the second quarter of this year (2.1%) the volume of construction investments
fell by 11.2%, which was influenced mainly by decreasing investments in dwelling construction.
Investments in machinery and equipment rose by 10.5%, mostly due to
machinery investments in transport and wholesale and retail trade.

Among the sections representing greater
weights the volume of investments in real estate, renting and
business activities decreased by 11.7% compared to the level of the
previous year. This section covers dwelling constructions, in which a
significant fall was observed in comparison with the same period of
the year before. Investments in manufacturing were down by 2.4%.
Within this, investments in the manufacture of rubber and plastic
products, other non-metallic mineral products and transport equipment
decreased to the highest extent, which was partly caused by the very
high base in the second quarter of 2007. The greater part of the
extension (7.2%) in transport, storage and communication comes from
significant investments in telecommunications and transport.

Among the sections representing medium
and little weights in total investments public administration and
defence and compulsory social security investments, and especially
those in the central government dropped the most (39.8%). Investments
declined by 15% in other community, social and personal service
activities, and by 12.1% in education. The greatest increase (28.3%)
was measured in investments in the section of hotels and restaurants,
having little weight, which increase resulted from the reconstruction
and extension of the buildings of smaller hotels. Within the increase
of 16.5% of section wholesale and retail trade the investments of big
chain stores are remarkable.