Hungary’ GDP was up 1.9% in the fourth quarter from the same period of the previous year, according to the Central Statistical Office (KSH). Seasonally adjusted data show a 1.7% quarterly increase. In 2010, GDP rose 1.2% to HUF 27,120 billion at current prices. GDP per capita reached HUF 2.7 million.
Industrial performance increased 9.7%, primarily due to an expansion in export-oriented manufacturing. KSH blamed the almost 19% quarterly drop in agriculture on the poor harvest caused by the unfavorable weather. Construction continued to show a decline, falling 7.2%.
Only 17,000 new housing permits were issued in 2010, while the low number of new accommodations, at 21,000, indicates a further decrease in construction. Output from services rose slightly for the second consecutive quarter, led by a 2.8% increase in transport, storage and communication in Q4.
On the expenditure side, household consumption fell by 0.8%, which came as a disappointment after slight growth in Q3. Volumes decreased in most commodity groups, especially in transport, health and food, partly because of the high base figures. Total consumption decreased by 1.9% in Q4.
Investments fell by a sharp 9.1%, which is hardly surprising given the current unpredictable business environment. The significant growth in arts, entertainment and recreation was due to investments in the city of Pécs, which was a European Capital of Culture last year, as well as to projects related to Hungary’s EU presidency.
Analysts say that Hungary’s economy is likely to grow by a little over 2% in 2011, which is well under the government target of 3%. Employment could be up 1% through 30,000 new jobs, according to the latest forecast of economic think tank Pénzügykutató. Thus, it remains doubtful how the government will be able to create 300,000 new jobs by the end of 2014 and one million within ten years.
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