Page 34 - CE Outlook Regions 2022
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2.3.4 Industrial production
The recovery of Hungary’s external trade partners has lent
support to Hungary’s industry in H1, which shifted to a higher
gear from a low base. Hungary is one of the most open
economies globally. Ranked 94th in terms of population, the
country is 34th in terms of export sales, which equal annual GDP.
The industry has been in a downward trend since H1.
As opposed to the upswing in domestic demand, Hungary’s
industrial exports gradually deteriorated as a result of the global
semiconductor shortage and deceleration in exports. Smaller
sectors of the industry were not able to offset the slump of the
main sectors.
The global shortage of chips has caused disruptions in vehicle
manufacturing as factories were compelled to operate either in
reduced shifts or shut down for weeks. The underperformance of
the German industry has impacted the economies of the region
as well, since many of them are deeply embedded in the German
supply chain.
The share of the automotive industry and electronic products
within goods exported is over 40%, which is slightly less than in
Czechia and some 10pp lower than in Slovakia.
The National Bank projects shortage of semiconductors may
continue for most of 2022 as well; in a best-case scenario, the
problem may be solved in H2 next year, or in a worse case only
during 2023.
New capacities built out in the industry during the pandemic
boosted by generous subsidy schemes could further boost output
in 2022 after a 10-11% growth in 2021.
34 CE Outlook 2022 www.intellinews.com
