NGM: the weakness of foreign markets is hindering the recovery of industrial performance

By: Trademagazin Date: 2024. 03. 06. 12:17

According to the data of the Central Statistical Office (KSH), industrial performance decreased by 3.6 percent on an annual basis in January 2024, while a decrease of 1.1 percent was experienced compared to the previous month. Industrial production continues to be negatively affected by the negative effects of war and sanctions that have caused significant damage to the European economy. The weak foreign market demand associated with the weak European economy dragged down the domestic output of the sector through the moderation of export activity – this is what the Ministry of National Economy (NGM) concludes from the latest statistical data.

It was repeated: in 2024, the government’s goal is to restore growth and to increase the GDP dynamically again by around 4 percent. To this end, labor market activity must be further increased, consumption must be restored and increased by gradually removing the motive of caution and strengthening confidence, and investments must be kept above the 25 percent level.

The government supports the industry’s performance and investments with state-supported programs such as the Gábor Baross Reindustrialization Loan Program, which has been increased to HUF 1,200 billion, the Széchenyi Card Program, and the Food Industry Supplier Development Program, which has been expanded sixfold. The voluntary action of commercial banks, launched on February 1, 2024, which reduced the interest spread above the BUBOR to 0 percent, thereby significantly reducing loan interest rates and encouraging development, will also contribute to the increase in investments, the ministry’s statement said.