Hungary as a market

Market information and Danish footprints

The Hungarian economy is on a path of slow recovery. Due to an effective monetary policy response, supported by declining commodity prices and a stricter fiscal approach in 2023, inflation has decreased rapidly. Meanwhile, the labour market and financial sector have shown resilience. The substantial current account deficit of 2022 has shifted to a surplus, and economic output is beginning to recover. Hungary is a relatively open market, with almost 14 thousand foreign owned companies present in the country. These investments account for a large share of manufacturing, telecommunications, finance, retail and the energy sectors in Hungary.

Leading Danish brands include Abacus Medicine, Hagens, Carlsberg, Coloplast, Danfoss, DSV, Grundfos, Hartmann, Jysk, Lego, Novo Nordisk, Nilfisk, Pandora, Rockwool, Tiger, Velux, Vestfrost, and Xellia.

What is the reason behind this success story? The answer is partly Hungary's central location and its excellent transport, logistics and info-telecommunications infrastructure. Features that makes Hungary a preferred destination among foreign investors. Another of Hungary's strengths is its well-qualified labour force at relatively low wage costs. Several incentives are available for those considering a sizeable investment. Hungary also offers a simple and low corporate taxation (European record low 9 percent), a flat personal income tax rate of 15 percent and a decreasing burden of contributions on the employers’ side. At the same time, continued growth and increase in public and private investments have produced a shortage in the labour market and is a challenge in several sectors.

Danish subsidiaries in Hungary employ around 16,000 people. Recently, more and more Danish companies focus on innovation and research – with examples of the local units of Foss A/S in Pécs, Xellia Pharma in Budapest or Grundfos in Székesfehérvár/Tatabánya.

Sectors in focus

Hungary is a dedicated member of the EU, with a stable economy, low unemployment. The Danish-Hungarian business relations have a long and significant history, including cooperation with various smaller and bigger Danish companies. The particular opportunities for Danish products and services are in:

Machinery, metalworking, parts supply, automation and robotics sectors
Energy efficiency and renewable energy, climate and water management
Food and agriculture, including organic foods and food processing, smart solutions for the agricultural sector
Digital, IT and tech solutions
Healthcare and healthy living
Consumer goods and especially Danish design, fashion and furniture

Export/import with Denmark

Export

Hungary was Denmark's 25th largest export market (goods) in 2023.
During the period from 2017 and 2022, Denmark's exports to Hungary grew at an annual rate of 36.9%, rising from USD 131 million to USD 632 million.
The commodity group with the highest export value was general industrial machinery and equipment, as well pharmaceutical products.

Import

During the period from 2017 and 2022, exports of Hungary to Denmark have increased at an annualized rate of 64.5%, from $71.8M to $864M
The commodity group with the highest import value was general industrial machinery and equipment, cars and machine parts.

Direct investment

Denmark is the 21st largest investor in Hungary in terms of foreign direct capital stock in the country, with a direct capital investment stock of USD 1,374.23 million in 2022, accounting for 1.3% of the total FDI stock in Hungary.

Denmark's trade with Hungary

Million USD	2017	2018	2019	2020	2021
Export	545	591	508	502	599
Import	820	862	817	725	823

Largest export categories in 2022

Export goods category	Volume (million USD)
Machinery, mechanical appliances and parts	157
Medicinal And Pharmaceutical Products	113
Plastics and articles thereof	89
Electrical machinery and electronics	76
Total goods exports to Hungary	632