Economic Analyses in Spring 2014
Having experienced the last year’s surprise GDP growth, the economic research institutes foresee for 2015 slowdown, temporarily continuing deflation – without hard tensions in the state budget. That’s the common message of the spring forecasts of the various institutions. The press usually informs only about the most important economic data, providing less and less room for the analyses, the detailed studies prepared by the institutions do not reach those who are interested. This is the reason why we have been publishing short summaries of these reports and prognoses since 2001. The recent analyses have been discussing the possible consequences of the economic policy, the path of the gross state debt, how to reach the budget deficit targets and the uncertain prospects of the economic growth and deflation.
Agricultural trade implications of Hungary’s EU accession
ZSUZSANNA HEGEDÜS – JUDIT KISS
The main objective of this paper is to analyse the impact of European Union (EU) membership on Hungarian agricultural trade with the EU-27 in the period 2003-1013, based on own calculations using the latest statistical data. It was concluded that the agricultural orientation of Hungarian foreign trade and the export orientation of the agricultural sector have strengthened during these 10 years. Hungarian agricultural trade with the EU-27 grew dynamically, with export expansion being accompanied by increasing import penetration. As a result of the three-fold export and import value growth, the EU-27 became the leading market for Hungarian export products (with an 83% share) and the main source of imports (with a 91% share). While the Hungarian export commodity structure is dominated by raw materials and semi-processed goods due to low competitiveness, the import structure is rather diversified, though processed goods oriented. The share of the New Member States has increased to almost 40% in Hungary’s intra-EU agricultural trade at the expense of the EU-15. Following a post-accession deterioration, the balance of Hungary’s agricultural trade with the EU had improved to a record of 2.7 billion euro by 2012.
The effect of return migration on SME Internationalisation: a comparative case study of Hungarian IT sector entrepreneurs
TIM GITTINS – RICHARD LANG – ÁGNES OROSZ
Transition to a market-based economic structure in the post-Communist countries of the Central and Eastern Europe region since the early 1990s has been accompanied by intense IT-driven technological change. Internationalisation opportunities have emerged for IT sector small and medium sized enterprises based on the region’s strong possession of technical skills. Furthermore transition has facilitated outward migration, return migrants who acquire social capital abroad and establish businesses upon return home may positively influence entrepreneurship, organisational human capital and SME internationalisation in the CEE region. This chain of phenomena remains relatively unresearched in a CEE context. A process-oriented qualitative case study approach is used to compare the experience of three IT sector entrepreneurs in Hungary who previously worked and studied abroad. Primarily, the acquisition of social capital from abroad is crucial for re- configuration of organisational human capital at home in order to drive ‘born-global’ SME internationalisation.
Labour market and labour migration on the Slovak-Hungarian border after the economic crisis
TAMÁS SZÉKÁCS
This study presents the project of Kopint Foundation For Economic Research about the migration on the Slovak-Hungarian border. The author introduces that the labour market differences are still significant between two sides of the Slovak-Hungarian cross-border, horizontally and vertically too. The writer of this study points out regarding the labour migration that numbers of the Slovak workers have been declined in a large measure between 2008 and 2013. He represents that number of the Hungarian workers in Slovakia haven’t been became important after the economic crisis.
Legal supplement
Decline of the Principle of Equal Treatment
JÁNOS MARTONYI
The multilateral regulatory framework of international trade driven by universal inspirations, as created by the GATT and the WTO, was based upon the principle of equal treatment. The ingenious legal implementation technique of this principle, the most favoured nation treatment, invented a long time ago, was not only multilateralized, but also elevated – with some notable exceptions – to be the main rule of the GATT system. As a result of the ever expanding and deepening regulation, as part of the globalization process, the world trade has become more and more liberalized. However, after many decades of successful development, roughly 15 years ago the process came to a standstill, in a way, became the victim of its own success. Among the various economic and political factors one reason of this slowing down was that the principle of equal treatment and its legal technique of implementation progressively lost its importance. The faltering of one of the main pillars of the system inevitably put the whole system at risk. In the first stage the most favoured nation treatment ceased to be the main rule and turned into an exception. Later on the exception, after being applied in an ever widening scope, brought about a new system based upon a wide network of bilateral and regional free trade and preferential agreements. Hence the decline of the original universalism and the fragmentation of the global regulatory framework. It is of utmost importance that the achievements of the multilateral regulation of world trade are preserved, while recognizing the fact that the global system is by far not as uniform and homogenous as it is frequently thought and the economic, political, cultural-civilizational differences – also as reflected in the field of legal rules and regulations – make the world much less flat than it may look like.
Financing problems related to the budgetary system of the European Union
ANNA BAJUSZ
The European Union’s budgetary system, even if it is able to fulfil its primary roles (such as the financing of the common European objectives), entails a lot of handicaps. In recent years, several problems occurred in the functioning of the annual budget, leading to a de facto lack of funds in certain budgetary years. This article gives a short insight into the functioning of the common European budgetary system (with a special emphasis on budgetary flexibility) and presents the nature and the reasons of the deficiencies. We argue that the problems encountered result from the new stipulations of the Lisbon Treaty, the political motivations of the institutions concerned as well as from the broader political and economic context.