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At the earliest, the performance of the Hungarian economy can only reach or approach the 2019 level by the end of next year. At the same time, nothing will be like it was before the pandemic.
The uptrend of the crisis is beginning to wane again, marking a shift in the form of aw and displacing the achievement of the 2019 performance by yet another year. Hopefully, starting in the spring of 2021, there will be no more relapses with a repeated attack of the epidemic.
In any case, the general opinion that neither the economy nor society will be the same as before will be true. Computer science and robotics will become more important and the usual forms of employment until now will also change. It now appears that, in a favorable case, the overall performance of the Hungarian economy will return to the 2019 level by the end of 2021, the Policy Agenda writes in its latest forecast.
Another wave of the coronavirus epidemic, which began in the third quarter of the year, has again changed previous forecasts, which were already uncertain. Although the crisis caused by the epidemic began to recover, the performance of most branches of the national economy expanded compared to the previous quarter, but the second wave of the epidemic arrived.
The performance of the economy in the third quarter decreased 4.6% year-on-year, but increased 11.3% quarter-on-quarter. As a result of the second wave of the crisis, the economic recession and recovery will be shaped like a “w”. In 2020, the decline is expected to be 7-8 percent annually, and in 2021, GDP growth may be low. The general government-to-GDP ratio is expected to be between 8 and 9 percent per year. As a result of the crisis, public debt is expected to increase to around 75 percent.
In January-September 2020, industrial production fell 9.2 percent compared to the previous year. Foreign sales volume, which accounted for 64 percent of total industrial sales, was 9.5 percent, and domestic sales, which accounted for 36 percent, were 6.6 percent lower than the last year. As a result of another economic downturn expected in the fourth quarter, the fall in industrial production could reach 11-12 percent in 2020. The fall in construction production could be 8 percent on an annual average.
Tourist traffic is also on a steep slope in the first eight months, with a 52.8% decline in the number of guests, including 33.8% in August, 51.2% of guest nights, and 33.2% in the eighth month below 2019. Gross sales of commercial accommodation in the first eight months were 50.8 percent lower at current prices and 32.6 percent lower in August than in the year previous.
Consumer prices remain high due to constant price pressure in the Hungarian economy. This is indicated by high and stable core inflation and persistently high levels of food prices. In the EU, consumer prices rose 0.2 percent in September, while in the eurozone they fell 0.3 percent from September 2019. Hungarian inflation is the second highest among the EU member states. European. The Policy Agenda predicts that by 2020, consumer price increases could reach 104.2 percent. Overall, retail volume could drop 2 percent this year.
According to the National Employment Service, the number of job seekers registered at the end of September was 6% less than a month earlier and 80,000, 32.9% more than a year earlier. In the ninth month of the year, employers were 26.8 percent less than a month earlier and 23.2 percent less than a year earlier. Almost two-thirds, 60.5 percent, of the new jobs announced in September were for public works.
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