Industry groups seek to pull in government for more intensive partnership.
In what is planned as an annual event, the American Chamber of Commerce, the Hungarian Investment Promotion Agency and the National Council for Telecommunications and Information Technology co-hosted the first “Business meets government” summit in Budapest on October 27.
In light of progress on the nine-country Trans-Pacific Partnership, growing cooperation between China and the United States, an emerging Russia-led Eurasian trading block and the rise of Latin America and Africa as investment destinations, keynote speaker Péter Szijjártó, Hungary’s Minister of Foreign Affairs and Trade, said Europe risked being left behind in the global competition.
“We Europeans debate the necessity of T-TIP, which is going nowhere,” he warned, talking about the much hyped Transatlantic Trade and Investment Partnership. He called for “pragmatic cooperation” with Russia and warned that Europe should not “limit ourselves regarding trade with China”.
Szijjártó said the EU should learn from the Hungarian experience in coping with the mass movement of people across the Continent. “We [Hungary] have proved that without gaining back control of the external borders of the EU, it is impossible to find any kind of answer to the migrant crisis.”
Noting that it was no longer enough to compete just in the immediate neighborhood, the minister identified two key areas: A skilled labor force that can meet the demands of current and future investors; and the need to widen the Hungarian supplier base for multinationals based here.
He acknowledged a longstanding complaint about predictability and “decisions made too quickly” which unnerved the boards back in the corporate headquarters. “We do not want to give you ‘hard days’ any more in this respect. We would like to give just very limited surprises to the business community in Hungary in the future.”
He also admitted there was a problem in connecting the lack of labor in the west of the country with the lack of jobs in the east, although he did mention Hankook as an example of best practice in this area. “We would especially welcome your feedback in how to mobilize the Hungarian workforce, and how to incentivize and subsidize more vocational training. If we can address these two challenges, we will be able to have progress” in moving up the world competitiveness rankings, he said.
Second keynote speaker Kálmán Kalotay, from the UN’s Conference on Trade and Development, said for all the Visegrád Four countries it is “very important to nurture foreign investment because FDI is an essential source of economic development for the group”. Suggesting that Hungary needs to improve access to finance and its capacity for innovation (“by far the lowest in the Visegrád Group”) by leveraging its scientific tradition, where it is a clear leader, he was hopeful the 1990s front runner in attracting FDI could regain lost ground (it now ranks behind Poland and Czech Republic). “Hungary and the Visegrád countries have the potential to attract more FDI, that is clear,” he concluded.
In his closing remarks, Farkas Bársony, AmCham board member and head of its investment policy task force, said a summary of the summit and its four breakout roundtable discussions, featuring both business leaders and government representatives, would be submitted to the prime minister as soon as possible so as “to make sure not to lose momentum”.