Economy Hungary
Economy - overview:
Hungary has made the transition from a centrally planned to a
market economy, with a per capita income nearly two-thirds that of
the EU-25 average. Hungary continues to demonstrate strong economic
growth and acceded to the EU in May 2004. The private sector
accounts for over 80% of GDP. Foreign ownership of and investment in
Hungarian firms are widespread, with cumulative foreign direct
investment totaling more than $60 billion since 1989. Hungarian
sovereign debt was upgraded in 2000 - together with the Czech
Republic, Hungary holds the highest rating among the Central
European transition economies. Rating agencies, however, have
expressed concerns over Hungary's fiscal and current account
deficits. Inflation has declined from 14% in 1998 to 3.7% in 2006.
Unemployment has persisted above 6%. Hungary's labor force
participation rate of 57% is one of the lowest in the Organization
for Economic Cooperation and Development (OECD). Germany is by far
Hungary's largest economic partner. Policy challenges include
cutting the public sector deficit to 3% of GDP by 2008, from about
6.5% in 2006, and orchestrating an orderly interest rate reduction
without sparking capital outflows.
GDP (purchasing power parity):
$172.7 billion (2006 est.)
GDP (official exchange rate):
$113.1 billion (2006 est.)
GDP - real growth rate:
3.8% (2006 est.)
GDP - per capita (PPP):
$17,300 (2006 est.)
GDP - composition by sector: agriculture: 3.1% industry: 32.1% services: 64.8% (2006 est.)
Labor force: 4.2 million (2006 est.)
Labor force - by occupation: agriculture: 5.5% industry: 33.3% services: 61.2% (2003)
Unemployment rate:
7.4% (2006 est.)