NGM: German economic recession drags down Hungarian industry’s performance

By: Trademagazin Date: 2025. 02. 06. 12:06

The German economic recession is dragging down the performance of Hungarian industry, the Ministry of National Economy (NGM) told MTI on Thursday, commenting on the latest data from the Central Statistical Office (KSH).

The statement recalled that, according to the latest data from the Central Statistical Office, the volume of industrial production decreased by 5.3 percent in December 2024 compared to the same period of the previous year, and by 1.8 percent compared to the previous month based on seasonally and working day adjusted data. In 2024, the performance of industry overall decreased by 4 percent compared to 2023.

The performance of domestic industry continues to be dragged down by the crisis in the German economy, and thus by weak external demand. The European Union suffers from competitiveness problems, and Germany has been struggling with a two-year recession and political and economic instability. The German economy is currently crushing the Hungarian economy, which is also having an impact on investments, exports and industrial performance through supply chains.

In Hungary, modern factories and capacities are available, but due to the crisis in foreign markets, they are producing at lower utilization rates. However, thanks to the recovery of domestic demand, there are already encouraging signs in the domestic industry, and last December the production of computers, electronics, optical products, and food, beverage and tobacco products also increased

– they wrote.

The Hungarian economy has reached a turning point: the domestic economy is recovering, the middle class is strengthening, and family confidence is gradually improving. Real wages have been increasing for more than a year, consumption is expanding, domestic tourism closed a record year in 2024, employment is outstanding, the new and used car market is picking up, the number of housing transactions is growing dynamically, and retail lending is also booming – they added.

The government is working to make Hungarian SMEs more efficient and competitive. This is supported by the Sándor Demján Program, which is part of the New Economic Policy Action Plan, which consists of 21 measures and is now starting to have an impact.