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Gov't plans to support FDI of Hungarian businesses

The Hungarian government is preparing a scheme to give financial support to the direct foreign investment (FDI) of Hungarian businesses, the financial daily Vilaggazdasag reported on Monday.

The pilot project may be launched in the summer.

The scheme will target companies with Hungarian owners, and it will focus on promoting the FDI of medium-size companies, National Economy state Secretary responsible for external economic affairs Zsolt Becsey told the paper.

The support scheme could bring forward foreign projects of these companies through providing finance. One motive behind supporting Hungarian capital investment abroad is that the profit repatriated would improve Hungary's current account balance, Becsey said.

Foreign units of Hungarian businesses paid out EUR 665m or 65.1% of 2009 profits as dividend to their Hungarian parents last year, the paper wrote.

FDI by Hungarian companies fell from EUR 1.9 billion in 2009 to EUR 628m in 2010.