Message from Ambassadors

Hungary: Promising partnerin the Central-Europeanindustrial growth engine

István Szerdahelyi

Ambassador of Hungary to Japan

Hungary as an Attractive BusinessLocation
Hungary is located in Central and Eastern Europe atthe crossroads of four main pan-European corridors,in the very heart of central Europe. Hungary has anominal GDP of over EUR100 billion, a populationof 10 million and an advanced and export-oriented
economic structure centering on the automotive andchemicals industries, with per capita GDP exceeding
EUR 20,000. In 2015 Hungary’s GDP increased by2.9 %, and this was one the highest figure in the EU,
as Central-Eastern Europe - including Hungary- hasbecome Europe’s industrial growth engine in therecent years. Inward FDI stock amounted to 78% of
GDP the highest ratio in the region and FDI flow has
been a key factor behind productivity growth inHungary, technology modernization, a sound growth
structure and the creation of new jobs. Thanks to thegovernment’s firm stance of reining in fiscal deficits
at 3% or lower of GDP, fiscal deficits have been kept
in check at close to the 2% level of GDP since 2012.
The general government debt is on the decline and is
78% relative to GDP as of end 2015.
Since the early 1990s, following Hungary’s
transition from a socialist economy to an open market,
the country has positioned itself as a key investment
destination for Japanese companies looking for accessto European and regional markets - while offering

world-class infrastructure and a highly educatedworkforce. Hungary is a full member of the European
Union since 2004, which makes it easy for companies
to reach more than 500 million people in the EU andanother 200 million to the East. Thanks to its favorablelocation, its stable macroeconomic and investorfriendly political environment, Hungary is a perfectinvestment location.
Particular emphasis is placed on encouraging
foreign investment. Partnership with potential investors
is considered a national priority. Special attention ispaid to the needs of companies already settled in
Hungary and to the further improvement of the businessclimate. In order to improve the business climate, theHungarian government reduced the corporate tax rate
to the lowest level in the CEE region (10/19%), createda new, even more flexible labor code in favor ofemployers, created free enterprise zones with special
tax and contribution allowances and entered into
strategic agreements with numerous companies.

146 years: Japan’s partner in the heartof Europe
Despite the geographical distance, Hungary has
traditionally a strong relationship with Japan. The
Austro-Hungarian Empire established diplomatic
relations with Japan 146 years ago, and Hungary reestablished them 56 years back. During this long

H.E. Mr. István Szerdahelyi was appointed as ambassador toJapan in 2011, this is his third diplomatic mission to Tokyo:
the first assignment took place as cultural attaché in the early’90s, the second term was as ambassador to Japan between
1999 and 2003. Beside his foreign career he has a successfulcareer course in the academic life as well. Before taking thepresent post, he had led the Department of Japanese studies
at Eötvös Loránd University.

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特集１：新・日本のモノづくり

One of the most visible Japanese investments in Hungary- Suzuki Motor and its new Vitara/Escudo model
Japanese-Hungarian Prime Minister’s meeting,
November 2013, Tokyo

history of Hungarian-Japanese relations, we havecounted ourselves lucky for the excellent bilateral ties
in all fields, especially in politics, economics, culture,sport, higher education and technology. Hungarian
Prime Minister Viktor Orbán paid an official working
visit to Japan in November 2013. During this visit, aswell as Foreign Minister Kishida’s visit to Hungary inAugust 2014 and Foreign Minister Szijjarto’s visit toTokyo in November 2014 a series of bilateralagreements were signed, all of which substantiallycontribute to further deepening our cooperation andstrengthening the Japanese-Hungarian friendship.
Cultural exchanges represent the most visible tiesbetween Hungary and Japan.

Bilateral investment and trade relations
Based on the total volume of exported goods andservices and investments, the Hungarian- Japaneserelation can be regarded as a success story of
Hungary’s “Eastern Opening” policy. Japan has
apparently become one of the most importantinvestors in Hungary with a total stock of invested
capital amounting over 3.9 billion Euros, having
brought in not only a significant amount of direct
investment but also a highly-developed corporate
culture. Thus, the Hungarian Government pays
special attention to improving the overall conditionsof Japanese company operations. As regards Japanese
economic presence in Hungary, there are 141
successful Japanese companies in the country out ofthem 47 opened their manufacturing facilities,employing more than 25,000 people. The following
Japan based companies have made major direct
investments in Hungary: Suzuki, Alpine, Asahi Glass,Bridgestone, Denso, Hoya, Nissin Foods, Ibiden toname a few. Hungary esteems Japanese investors

consequently the government has signed strategic
partnership agreements with the leading companies
like Suzuki, Bridgestone, Denso, Takata, Alpine,Toray, Ibiden. The construction and food industry, therenewable energy sector, water and waste management
and IT are among possible fields of HungarianJapanese economic cooperation. Besides investments,
the trade volume has also been showing a growing
tendency, especially the export of Hungarian fooditems to Japan. Japan is the biggest export market for
Hungarian food items in Asia.

Economic diplomacy
The Hungarian Investment Promotion Agency (HIPA)
was established to provide professional help to foreigncompanies intending to invest in Hungary. HIPA’stask is to support the implementation of theGovernment’s key investment promotion targets andto foster bilateral and multilateral international
economic relations. To this end, HIPA seeks andmaintains contacts with potential foreign investors,
helping them to prepare and implement strategic
investment decisions, as well as providing postdecision support and encouraging their intention tore-invest. The trade and investment representatives
play an ever growing role in Hungary’s diplomatic
missions: investment promotion, introduction of the
Hungarian economy and investment environment,
breaking down trade barriers and maintaining close
contacts key Japanese corporate and government
decision makers are all significant tasks.
＊ This message was contributed in February 2016.

HIPA では、世界 120 カ国で 136 人の外交官が現地窓口として投資家をサポートしています。日本でのお問い合
わせは、ハンガリー大使館 アンナ・バーリン二等書記官（ 電 話 :03-5730-7120、Fax:03-57307124、E-mail:ABalint@mfa.gov.hu、URL: www.hipa.hu）まで。

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