Budapest remains an attractive destination for foreign investors, despite somewhat mixed opinions over the political course the Hungarian government is taking.
“Investor sentiment and their interest in Hungary have been very stable,” said Róbert Ésik, president of the Hungarian Investment Promotion Agency (HIPA). “They are looking for two things: stability and an economic environment that fosters investment. We can count on both political and economic stability, a plus for long-term investments. Furthermore, we registered five per cent GDP growth last year, more than double than the EU average.”
What most attracts investors however is the lowest rate of corporation tax in Europe, just nine per cent.
“Our philosophy is to reduce the burden of taxes as much as possible, through reducing the social contributions. From July 2019, we can expect a 9.5 per cent decrease [of the total tax burden] compared to 2016, which will continue to attract FDI, which already reached record highs in 2018,” Mr Ésik told Emerging Europe at MIPIM, the world’s largest property market.
Budapest is now looking forward to attracting more tech investment, boosting the R&D sector. In 2018, HIPA brought 98 projects to Hungary with a total capital of more than 4.31 billion euros, creating 17,024 new jobs.
“Our strategy is to focus on quality instead of quantity. We have the historic opportunity to elevate the Hungarian economy to the next level. We need to create jobs with a high-added value, relying on the most advanced technologies,” Mr Ésik continued.
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