Recent impact of FDI on the Hungarian economy and foreign trade

Loján Dorina (2024) Recent impact of FDI on the Hungarian economy and foreign trade. Külkereskedelmi Kar.

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Absztrakt (kivonat)

Foreign direct investment (FDI) plays a key role in global economic development, especially for smaller, open economies like Hungary. After the 1989 regime change, Hungary became one of the most important FDI destinations in the Central and Eastern European (CEE) region. It has this position due to its favourable geographical location, its accession to the European Union, favourable tax policies and state support. FDI not only generates economic growth, but also contributes to Hungary's global competitiveness by modernising the industrial structure and introducing new technologies and work cultures. FDI inflows in Hungary are mainly concentrated in a few strategic industries, in particular automotive, electronics and pharmaceuticals. These sectors have now become the backbone of the Hungarian economy. The automotive sector, which is characterised by the presence of multinationals such as Audi, Mercedes-Benz and Suzuki, not only creates a significant number of jobs but also contributes significantly to export growth. The integration of these companies into global value chains helps to diversify Hungary's exports, reducing the country's dependence on its domestic market while increasing economic stability. The electronics industry is also attractive to FDI, given Hungary's highly skilled workforce and proximity to European markets. Companies such as Samsung and Bosch have made significant investments, not only to support technological development but also to stimulate domestic innovation. The regional distribution of FDI in Hungary is uneven, resulting in significant economic disparities. The Central-Hungarian region, with Budapest at its heart, continues to account for a particularly large share, while rural regions attract less investment. This regional concentration further deepens economic disparities within the country. Public incentives such as targeted tax breaks, vocational training subsidies and infrastructure development can improve the catching-up potential of rural regions. A key benefit of FDI is to promote technological development and stimulate innovation. The advanced technologies and modern work processes introduced by foreign companies can also benefit Hungarian small and medium-sized enterprises (SMEs), in particular through the development of local supplier networks. This increases the competitiveness and adaptability of SMEs in the global market. Job creation is also a significant FDI contribution in Hungary, especially in high value-added sectors. In addition to the automotive sector, jobs created in the electronics and pharmaceutical sectors require high skills, which contributes to raising the skill level of the Hungarian labour force. The geographical sources of FDI into Hungary have diversified in recent years. While European Union countries remain among the largest investors, investments from Asia, especially China and South Korea, are becoming increasingly important. This trend is a sign of global economic restructuring and offers new opportunities for the Hungarian economy. The Hungarian government is using a number of strategies to attract FDI, including tax incentives, state subsidies and infrastructure development. However, the lack of skilled labour and tight labour markets pose serious challenges. Infrastructure development and improving the investment climate in rural regions are also key to attracting further FDI. The role of FDI in Hungary's economy is crucial, in particular in promoting export growth, stimulating innovation and supporting technological development. In addition to the immediate effects, such as job creation and increasing economic stability, FDI also has significant long-term effects, such as modernising the industrial structure and improving the competitiveness of SMEs. However, further government efforts are needed to address regional disparities and labour market challenges. Hungary's ability to attract FDI will depend to a large extent on its capacity to adapt to global economic trends and on effective policy measures to boost investor confidence.

Intézmény

Budapesti Gazdasági Egyetem

Kar

Külkereskedelmi Kar

Tanszék

Nemzetközi Gazdaságtan Tanszék

Tudományterület/tudományág

NEM RÉSZLETEZETT

Szak

Nemzetközi gazdálkodás

Mű típusa:	diplomadolgozat (NEM RÉSZLETEZETT)
Kulcsszavak:	gazdaság, külföldi közvetlen beruházások, külgazdaság, külkereskedelem, Magyarország
SWORD Depositor:	User Archive
Felhasználói azonosító szám (ID):	User Archive
Rekord készítés dátuma:	2025. Már. 12. 11:09
Utolsó módosítás:	2025. Már. 12. 11:09

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