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Seeking more investment from Korea-Hungary offers favorable conditions

Hungary offers favorable conditions

By Rachel Lee for koreatimes.co.kr

Direct flights between Hungary and Korea would pave the way for further economic ties, says Hungary’s Minister for National Economy, Mihaly Varga .

“To meet the growing demand, we are discussing setting up direct flights between the two counties with Korean Air,” he said. “This would also make it more convenient for those on business trips.”

Seoul and Budapest concluded an aviation agreement last May. About 80,000 tons of air cargo is transported each year between the countries each year, according to the ministry.

Varga, who was in Korea for the second Hungarian-Korean Joint Economic Committee meeting on Feb.

25, held talks with Minister of Trade, Industry and Energy Joo Hyung-hwan.

They discussed in detail the points raised at the Korea-Hungary Summit last December.

These included Korean companies being involved in Hungary’s construction projects, and exports of

Korea’s KUH-1 Surion helicopters to Hungary.

“This year, the committee is looking at current economic conditions and discussing ways to cooperate in other various fields,” Varga told The Korea Times at the Lotte Hotel Seoul on Feb. 25.

“Tourism is one of the key sectors to develop, which will bring multiple advantages for the two sides.”

The minister said more Koreans and Hungarians were visiting each other’s countries every year, with, a growing number of Hungarians visiting Korea for medical reasons.

According to Hungary’s Ministry of National Economy, the number of Korean tourists reached 120,000 last year.

The Hungarian economy, unlike that of other European Union (EU) countries, has been growing steadily since the 2008 financial crisis. While other EU member states have a 1 percent growth rate, Hungary has 3 percent growth . Gross domestic product rose 3.2 percent from October to December from last year.

“The main reason for the stable economic situation comes from a huge influx of overseas investment,” Varga said. “Our relatively low costs compared to other EU nations have also made us more competitive.”

About 40 Korean companies, which employ about 235,000 people, are active in Hungary.

“Korean enterprises have invested about $2.2 billion in our country at the moment, and we are aiming to encourage more investment by offering more favorable conditions, such as offering loans of up to $500 million,” Varga said.

The minister said he hoped Hungarian companies would enter Korea, which would reduce the gap between the countries’ investments in each other.

“We have strong IT industry like Korea, and using our skills we are hoping to reduce the gap,” the minister said.

Varga, who graduated from the Karl Marx University of Economic Science of Budapest in 1989, was Minister of Finance from 2001-2001, Chairman of the Parliamenrary Committee on Budget, Finace and Audit from 2006-10 and State Secretary of the Prime Minister’s Office from 2010 and 2012.

The next economic joint committe is scheduled to be held in Budapest in 2017, the ministry said.

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