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Wednesday, May 07, 2008

Hungary External Trade February 2008 (Updated on Revised Data)

Well, Hungary's external trade balance continues to improve. according to the latest (provisional) data from the Hungarian Statistics Office (KSH) in February 2008 Hungarian exports amounted to HUF 1,612 billion (up 21% y-o-y), while the value of imports was HUF 1,571 billion (uo 17% y-o-y. The euro value of exports rose by 18%, while that of imports increased by 14% over the equivalent month of the preceding year.

In February 2008 the trade balance had a surplus of HUF 41 billion (EUR 149 million). The balance improved by HUF 54 billion (EUR 200 million) compared to the same month of 2007. The surplus compares with a deficit of EUR 79.5 million in January this year and a gap of EUR 50.8 m in 2007. As Portfolio Hungary wrly observes "It has not happened since 'time immemorial' that the 12-month trailing balance showed a surplus (EUR 32 m now)".

The steady and constant improvement in the external position can be clearly seen in the trade balance chart.

KSH also reported that Hungary sent 77% of its exports to the European Union and imported 68% of its goods from the EU in February.

Updated Tuesday May 6 2008

Hungary trade surplus in February was EUR 157 million, revised up from the preliminary EUR 149.3 m (see above), according to the Central Statistics Office (KSH) today. The 20% jump in Hungary's export volume does not reveal any impact at that point from the slowdown in the EU business sector, however the improved performance is largely attributable to a sharp increase in sales in Russia.

Exports in February totalled EUR 6,205 m, up 18% year on year, while imports totalled EUR 6,048 m , up 14% from the same month of 2007.

This improved export performance was to some extent attributable to strong growth in foreign sales in several product groups. The export volume of machinery and transport equipment jumped by 26% year on year in Jan-Feb. The engine behind growth - based on forint data at current prices - was telecommunications equipment, with 52% export and 63% import growth in annual terms. The export of mobile handsets doubled and their import grew 2.5 times year on year. The key market for mobile handsets remained Russia where exports were more than three times as large as in Jan-Feb last year. Some 13% of exports went to Russia, while more than 50% of the increased imports came from China.

While growth dynamics are the highest in machinery at transport equipment, this would not explain the surplus, since import growth is still larger than export growth in this sector. On the other hand, the increase in exports at manufactured goods was much larger than that of imports (12% and 7%, respectively). Looking at forint data at current prices, the sale of medical and pharmaceutical products grew by 30%, more than the overall export average. Exports of rubber manufactures leaped by 60% year on year. The substantial increase in foreign drug sales can be attributed to an over 60% rise in this product category going to Russia.

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