Trends in Hungary’s Foreign Trade and Competitiveness in 1999 and 2000 in the Light of EU Accession
Trends in Hungary’s Foreign Trade and Competitiveness in 1999 and 2000 in the Light of EU Accession
Hungary’s foreign trade turnover increased by more than 250%, more specifically, the trade in goods with the European Union’s (EU) member states multiplied sixfold, since the deregulation of foreign trade and economic restructuring that began in 1988 and 1989. Hungary’s foreign trade was restructured also in terms of its direction (country groups) and structure (key product groups) over the last decade. In 1989, nearly half of the country’s exports were directed to the former COMECON states, with just one-third destined for the European Union. These figures exhibited a reversal by 1999, with the European Union becoming our key trading partner; its member states received 76% of Hungary’s total exports, while the Central and Eastern European (CEE) Countries only 13% thereof. A similar process took place in the last decade regarding imports as well, with the difference that the European Union’s share was slightly less: its member states accounted for only 65% of all Hungarian imports during the same period.
Hungary’s foreign trade performance is well demonstrated by the fact that, according to the statistics of the Union calculated for its external trade (i.e., subtracting the turnover between the member states) Hungary was found to be the 8th most important foreign trade partner (it was outperformed, though by Russia and Poland) of the European Union in 1999. According to 1999 Eurostat1 data forming the basis of EU statistics, the participation of Hungary in the total foreign trade turnover of the European Union was almost 2.4%, in contrast to the 1989 figure of 0.6-0.7%.
The foreign trade boom picking up momentum beginning with the second half of 1999 – first of all the accelerating economic growth of the member states – had a favorable impact on the evolution of Hungarian foreign trade. Preliminary calculations of the Hungarian Bureau of Statistics (HBS) show that in the first ten months of 2000 the rate of increase of exports (imports) – measured at current prices in USD – was 13.1% (15.1%) higher than in the previous year. During the same period, our foreign trade ratio of exchange dropped by approximately 2.6%, however, this was primarily due to the price increase witnessed for energy carriers. At the same time, the downward trend of the euro was reflected in the 12.1% increase of Hungarian exports into the European Union, which thus remained slightly below the rate of increase for total exports. Consequently, the share of the European Union within exports decreased by one percentage point to attain 75%. On the contrary, the share of the 15 member states within imports decreased significantly, more precisely by 7 percentage points to reach 58% with respect to the same period of the previous year. This was due to the “only” 3% growth of Hungarian imports from the EU, as a result of which our trade surplus with respect to the European Union increased threefold in the first 10 months of 2000 compared to 1999, and totaled USD +2.016 billion.
Agreements Regulating Trade between Hungary and the EU
Trends in Foreign Trade in Goods in 1999
Most Important Trade Partners
Key Product Groups
Trends in Foreign Trade in the First Ten Months of 2000
