Photo: HEPA
Eurasia
14/05/2025 13:00
Economic potential of Hungary
Hungary is located in the heart of Central Europe and borders with several key countries in the region, such as Austria, Slovakia, Ukraine, and Romania. In 2024, the country's GDP reached $221.9 billion, which amounts to $23,100 per capita. The structure of the economy is characterized by the dominant share of the service sector (64.8%), followed by industry (31.3%) and agriculture (3.9%). The leading industrial sectors remain mechanical engineering (including automotive and shipbuilding), metallurgy, chemical and pharmaceutical industries, as well as food and light industries.
Hungary's foreign trade volume in 2024 amounted to $480 billion. The structure of Hungary's imports shows significant demand for products in which Uzbekistan can offer competitive solutions - textiles, leather goods, chemical and pharmaceutical industry products.
Political dialogue and institutional framework for cooperation
The foundation of bilateral cooperation is a comprehensive legal framework, including 64 documents covering a wide range of areas - from trade and investment to scientific and technical cooperation and education. Among the key agreements are the Agreement on Trade and Economic Relations (1992), the Agreement on the Protection of Investments (2002), and the Agreement on the Avoidance of Double Taxation (2008).
Active dialogue at the highest level has become an important factor in deepening ties between the countries. The visit of Hungarian Prime Minister Viktor Orban to Uzbekistan in 2021, followed by the visit of Uzbek President Shavkat Mirziyoyev to Hungary in 2022, marked a new stage in bilateral relations - their strategic institutionalization. As a result of these visits, dozens of agreements were signed, including declarations on the development of strategic partnership.
In addition, the Intergovernmental Commission on Economic Cooperation, which has been operating since 2013, plays an important role. The Commission's recent meetings (8th and 9th) held in Budapest and Tashkent respectively, as well as the planned 10th meeting in July 2025, underscore the systematic nature of bilateral cooperation.
Trade and investment cooperation
The basis of trade and economic relations is the most-favored-nation regime established by the Partnership and Cooperation Agreement between Uzbekistan and the EU.
The investment direction is of particular interest within the framework of Uzbek-Hungarian relations. As of April 1, 2025, 17 enterprises with Hungarian capital participation operate in Uzbekistan, including 10 joint ventures and 7 with 100% foreign ownership.
Among the most significant projects are the creation of poultry clusters in the Syrdarya region, the privatization of "Ipoteka-bank" by the Hungarian "OTP" bank, Pharmaceuticals, the localization of auto component production with "Joyson Safety Systems" and others.
Prospects and recommendations
Hungary views Uzbekistan as an important partner in Central Asia, and Tashkent, in turn, is interested in utilizing Hungary's potential as an "entry point" into the EU economic space. At the same time, the key drivers of further growth could be the development of production and logistics chains in pharmaceuticals and agriculture, promotion of Uzbek textiles, agricultural and other products on the Hungarian market.
In order to eliminate the imbalance in bilateral trade, measures are needed to stimulate exports from Uzbekistan, including promotion of export-oriented clusters, development of quality standards and certification of products for the European market.
Conclusion
Over the recent years Uzbekistan and Hungary have evolved from partners in individual projects to strategic allies interested in multi-level and long-term cooperation. If the current dynamics is maintained and the planned initiatives are realized, bilateral relations can reach a qualitatively new level, providing mutually beneficial conditions for economic growth and sustainable development.