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Hungary Economy

    Economy—overview: Hungary has consolidated its March 1995 stabilization program and undergone enough restructuring to become an established market economy. The country appears to have entered a period of sustainable growth, gradually falling inflation, and stable external balances. The government's main economic priorities are to complete structural reforms, particularly the implementation of the 1997 pension reform act (the first in the region), taxation reform, and planning for comprehensive health care, local government finance reform, and the reform of education at all levels. Foreign investment has totaled more than $17 billion through 1998. In recognition of Hungary's improved macroeconomic situation, all major credit-rating agencies listed the country's foreign currency debt issuances as investment grade in 1996. The current IMF stand-by arrangement expired in February 1998, and Budapest and the IMF agree that there is no need to renew it. The OECD welcomed Hungary as a member in May 1996, and in December 1997 the EU invited Hungary to begin the accession process. Forecasters expect 4%-5% growth in 1999.

    GDP: purchasing power parity—$75.4 billion (1998 est.)

    GDP—real growth rate: 5% (1998 est.)

    GDP—per capita: purchasing power parity—$7,400 (1998 est.)

    GDP—composition by sector:
    agriculture: 3%
    industry: 30.3%
    services: 66.7% (1996)

    Population below poverty line: 25.3% (1993 est.)

    Household income or consumption by percentage share:
    lowest 10%: 4.1%
    highest 10%: 24% (1993)

    Inflation rate (consumer prices): 14% (1998 est.)

    Labor force: 4.2 million (1997)

    Labor force—by occupation: services 65%, industry 26.7%, agriculture 8.3 (1996)

    Unemployment rate: 10.8% (1997)

    Budget:
    revenues: $11.2 billion
    expenditures: $13.2 billion, including capital expenditures of $NA (1998 est.)

    Industries: mining, metallurgy, construction materials, processed foods, textiles, chemicals (especially pharmaceuticals), motor vehicles

    Industrial production growth rate: 11.1% (1997 est.)

    Electricity—production: 33.162 billion kWh (1996)

    Electricity—production by source:
    fossil fuel: 58.76%
    hydro: 0.62%
    nuclear: 40.62%
    other: 0% (1996)

    Electricity—consumption: 35.362 billion kWh (1996)

    Electricity—exports: 2.2 billion kWh (1996)

    Electricity—imports: 4.4 billion kWh (1996)

    Agriculture—products: wheat, corn, sunflower seed, potatoes, sugar beets; pigs, cattle, poultry, dairy products

    Exports: $20.7 billion (f.o.b., 1998)

    Exports—commodities: machinery and equipment 51.9%, other manufactures 32.7%, agriculture and food products 10.5%, raw materials 2.9%, fuels and electricity 1.9% (1998)

    Exports—partners: Germany 37.3%, Austria 11.4%, Italy 6.1%, Russia 5.0% (1997)

    Imports: $22.9 billion (f.o.b., 1998)

    Imports—commodities: machinery and equipment 46.5%, other manufactures 40.2%, fuels and electricity 6.6%, agricultural and food products 3.7%, raw materials 3.0% (1998)

    Imports—partners: Germany 26.7%, Austria 10.5%, Italy 9.5%, Russia 7.4% (1997)

    Debt—external: $22.1 billion (1997)

    Economic aid—recipient: $122.7 million (1995)

    Currency: 1 forint (Ft) = 100 filler

    Exchange rates: forints per US$1—215.960 (January 1999), 214.402 (1998), 186.789 (1997), 152.647 (1996), 125.681 (1995),105.160 (1994)

    Fiscal year: calendar year

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Revised 1-Mar-99
Copyright © 1999 Photius Coutsoukis (all rights reserved)