Investment volume up 2.5% y.o.y. in Q4 2020
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In the fourth quarter of 2020, the volume of investments increased by 2.5% compared to the same period of the previous year and by 4.8% compared to the previous quarter (seasonally adjusted), following the decline measured in the first three quarters of the year, according to data by the Central Statistical Office (KSH).
The recovery of investment was caused primarily by the increasing activity of the general government and that of the households, while the enterprises continued to reduce their developments, the statistical agency notes.
Compared to Q4 2019, The volume of investment activity increased by 2.5%, within it construction investments representing close to six-tenth of the total volume of investments increased by 1.8%, investments in machinery and equipment representing four-tenth of the total value of investments grew by 3.7%. In the case of the last indicator the growth was caused primarily due to the surge in machine investments of import origin.
The volume of investments in the case of enterprises employing at least 50 people and realizing more than half of the investment performance decreased by 3.6%, where subdued investments of foreign-owned enterprises played a prominent role. At the same time in the case of budgetary units, realizing 18% of investments, the acquisitions of new tangible assets were up to a great extent, by 10% compared to the base period.
The change in investment volume in certain sections of the national economy wasn’t even. The investment performance of the current period’s largest weight representing real estate activities, realizing close to a quarter of total investments, largely increased, by 24%, the growth being attributed to the determining weight representing dwelling constructions. In addition, developments oriented toward business facilities for rent (e.g. commercial properties) grew moderately.
Developments in the second-largest weight representing manufacturing – being responsible for 24% of investments – slightly fell (by 5%) in the 4th quarter compared to the high basis. Within it developments decreased in the majority of the subsections, among others in the greatest weight representing manufacture of transport equipment, in the manufacture of chemicals and chemical products as well as in the manufacture of rubber and plastic products. At the same time – due to ongoing high-volume projects as well as newly started developments – in some subsections, the volume of the current period increased significantly, for example in the fields of manufacture of electrical equipment, in the manufacture of basic pharmaceutical products and pharmaceutical preparations, and in the manufacture of food products.
The measure of decrease in the third-largest field, transportation and storage eased down (investments decreased by 9.7%). The relapse was still caused mainly by the reduction of infrastructural developments by the state, and investments of state-controlled enterprises engaged in transportation also fell behind compared to the base period.
Overall the general government contributed positively to the performance change of the national economy’s investments. The volume increased by 21% in public administration, the area with the fourth largest weight. In connection with the epidemiological situation as well, through outstanding asset acquisitions in the in-patient care area the developments in human health and social work activities grew outstandingly (by 23%), too. In education and in the state-dominated, 6th largest weight representing arts, entertainment and recreation investments of current period increased equally by 20%, in the latest case primarily due to the high volume of the competitive sport projects.
In the field of wholesale and retail trade, and repair of motor vehicles and motorcycles carrying the fifth-largest weight, investments increased slightly (by 3.1%), where enterprises operating in retail trade and in wholesale and retail trade and repair of motor vehicles and motorcycles increased their investments.
In several medium weight carrying sections of the national economy developments have decreased significantly. Investments in agriculture, forestry and fishing fell significantly (by 26%), where mainly the larger companies dealing with stock-raising or crop production reduced their investment expenditure. Investments fell substantially (by 28%) in the energy industry, mainly because of lesser developments in electricity production.
In several smaller weight carrying sections of the national economy investment performance has increased significantly. Investments grew outstandingly (by 28%) in the field of information and communication, where the modernization of telecommunication networks also played a role. Investments in financial and insurance activities grew as well (by 8.6%), mainly as a result of procurement of IT assets. Among business units in construction developments grew by 21%, mainly as a result of vehicle purchases.
Investment volume down 3.8% in 2020 as a whole
The volume of investments in the national economy decreased by 3.8%, within it the volume of construction investments lessened by 2.8%, investments in machinery and equipment fell by 5.4%.
Investment performance decreased in the case of enterprises employing at least 50 persons, providing 54% of investments by 7.5% and in the case of the budgetary units by 5%.
Considering the whole year investment volume decreased in all sections except four. Among the most important investing sections investment volume fell in manufacturing – being responsible for more than a quarter of total investments – by 8.1%, in transportation and storage by 9.5%; on the other hand in real estate activities the volume grew by 16%, being responsible for more than a fifth of total investments. These three sections realized around six-tenth of investments.
The volume was almost unchanged (–0.2%) in public administration and defense, the fourth largest area of investment, and decreased (–9.3%) in wholesale and retail trade, and repair of motor vehicles and motorcycles, the fifth-largest section.
The volume of developments grew at the second-highest extent, in connection with the pandemic situation, too, in the field of human health and social work activities (by 15%).
At the same time KSH registered significant decreases in several, small weight representing sections; for example in the field of other service activities by 35%, in case of accommodation and food service activities the volume fell by 16%.
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