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Hungary’s annual GDP growth accelerated to 5% in the fourth quarter of 2018, the Central Statistical Office (KSH) said in a first reading of data. The rate was well above the 4.5% estimate by analysts polled by business daily Világgazdaság. Growth accelerated from 4.9% in both Q3 and Q2, bringing full-year growth to 4.8%. KSH said “most sectors of the economy contributed to growth; market-based services to the greatest degree”.
Commenting on the fresh data in a statement released by his ministry, Finance Minister Mihály Varga said the big contribution of services to GDP growth last year was supported by a six-year agreement on minimum wage rises paired with payroll tax cuts the government reached earlier with employers and unions. The construction sector, boosted by government measures supporting home building, lifted the production branches of the economy, he added. The global economy and the region face “political and economic uncertainty”, Varga said, noting that the European Commission had recently lowered its projection for economic growth in the European Union. “In the interest of maintaining the high rate of growth in Hungary and keeping it at least two percentage points over the EU average, the government is helping improve competitiveness with a number of measures and is working on an action plan to protect the economy,” he added.