China-Hungary bilateral economic and trade growth against the trend
Zhai Chaohui, reporter based in Budapest
The Sino-European Trade and Logistics Cooperation Park in Budapest.
Photo by Zhai Chaohui
Despite the impact of the new crown pneumonia epidemic, the bilateral trade volume between China and Hungary still maintained a substantial growth of 12.3% from January to October 2020.
Hungarian Deputy Prime Minister and Minister of Finance Volga said that the bilateral trade volume between Hungary and China exceeded 9.5 billion U.S. dollars. China has become Hungary’s most important trading partner outside Europe, whether it is in the economic, trade, investment or financial fields. The pragmatic cooperation relationship with China can be regarded as a model.
The circle of cooperative friends is getting bigger and bigger
What is striking is the investment data.
From September to November 2020 alone, in just three months, a number of large projects invested by Chinese companies landed in Hungary one after another.
Among them, Lenovo announced that it will invest about 22 million euros (1 euro or about 1.2 US dollars) to build the first European factory, and Nanjing Quanfeng Automotive Precision Technology Co., Ltd. will invest about 60 million euros to establish the world's first overseas subsidiary and build automotive parts intelligent To manufacture the European production base, Shanghai Enjie New Material Technology Co., Ltd. invested 183 million euros to build a lithium battery isolation membrane plant, and Wanhua Baosteel Chemical Company increased its capital by 33 million euros to start a new chemical project.
These projects will not only bring a lot of jobs to Hungary in the future, but also increase Hungary's confidence in restoring the economy.
According to statistics, in 2020, Chinese-funded enterprises will choose Hungary for 10 investment projects throughout the year, with a total investment of over US$460 million.
As of 2020, China’s cumulative investment in Hungary has exceeded US$5.5 billion, accounting for half of China’s investment in the entire Central and Eastern European countries.
Hungary has been a well-deserved investment hot spot in Central and Eastern Europe for many years.
The friendly relations between China and Hungary are firm and stable. This is the most important ballast in the political relations between the two countries.
Hungarian Prime Minister Orban once stated that despite the constant changes in the international environment, the profound friendship between China and Hungary is built on a solid foundation and has withstood the test of time. The comprehensive strategic partnership established by Hungary and China, the The connection between the “One Road” initiative and the “17+1 cooperation” has been effective for a long time.
The economy and trade between China and Hungary are highly complementary, and Hungary's investment in depressions has an obvious effect, and it occupies the natural geographical advantage of European logistics centers.
In recent years, more and more Chinese-funded enterprises have come to Hungary to develop. What they value is Hungary's political stability and good investment environment, and the circle of friends of China-Hungary partners is expanding.
New ideas bring "golden keys"
In an interview with our reporter, Liu Bo, Minister of Economic and Commercial Counselor of the Chinese Embassy in Hungary, said: "Traditional advantages only mean having a good foundation. In the global economic downturn, protectionism and unilateralism are on the rise, especially when the new crown pneumonia epidemic has not yet occurred. Under the severe situation that is fundamentally contained, only by finding new focus, exploring new methods and new ideas, can we rise to the difficulties and nurture new development opportunities for China and Hungary in the crisis."
During the epidemic, Chinese and Hungarian companies were unable to find suitable partners due to the cancellation of previous offline business meetings and exhibitions, information channels were not smooth, and the old methods were not working, which hindered the traditional business model of the companies.
Therefore, the China-Hungary local cooperation mechanism was officially launched in November 2020. As the first bilateral local cooperation mechanism between China and Central and Eastern European countries, it directly implements the "matrix precise docking method" combining point, surface and line between Chinese and Hungarian enterprises, including Promote point-to-point docking between Chinese and Hungarian companies; docking between Chinese and Hungarian cities with complementary resources and potential for cooperation to improve docking efficiency in a face-to-face manner; and the government-level docking between China and Hungary to help companies solve practical problems encountered. Work is a vertical line of responsibility, connecting from top to bottom.
In particular, city cooperation provides a new platform for industrial clusters and industrial chain extension, and opens up a multi-level, wide-ranging, and deep-interconnected bilateral cooperation path of "cities + industry associations + enterprises".
At present, the effectiveness of the local cooperation mechanism is beginning to show. A total of more than 40 Hungarian companies and investment promotion agencies have achieved precise docking with more than 20 Chinese companies and reached multiple cooperation intentions, which are welcomed by the Chinese and Hungarian business community.
At the same time, domestic cities have proposed to the Hungarian cities their intentions to establish sister cities.
The new development pattern provides the "golden key" to solve difficult problems for China-Hungary economy and trade.
The “two-zone linkage” initiated in 2020 is another innovative measure to effectively face the complex international business environment, implement the country’s task of stabilizing foreign trade and the main body, and helping enterprises to extend the supply chain of the industrial chain.
"Dual-zone linkage" refers to the linkage and cooperation between domestic cross-border e-commerce comprehensive pilot zones and overseas national economic and trade cooperation zones to help open up all links in the entire chain of foreign trade import and export, and realize the cross-regional and cross-pilot platform resources of the two types of parks Integrate, complement each other with functional advantages, promote "dual drive" with "dual zone", and achieve the effect of "1+1>2".
The Sino-European Trade and Logistics Cooperation Park in Budapest, Hungary, is a national-level overseas economic and trade cooperation zone, a national-level cross-border e-commerce overseas warehouse pilot unit and a national-level international marketing service public platform. It also operates the China-Europe Express and China-Europe-Sea Express And cargo flights from Zhengzhou to Budapest.
Under the "dual zone linkage" mechanism, the Sino-European Trade and Logistics Park has signed a memorandum of cooperation with the Linyi Comprehensive Pilot Zone in Shandong Province to provide it with cross-border e-commerce, international logistics warehousing and international marketing and other full-chain one-stop services; The cross-border e-commerce comprehensive pilot zone in Haidong City, Qinghai Province and the cross-border e-commerce comprehensive pilot zone in Ganzhou City, Jiangxi Province have reached cooperation intentions, and relevant agreements are being promoted.
At present, the effect of "dual zone linkage" is obvious, saving more than 50% of freight time, about 33% of logistics costs, and more than 10% of warehousing costs.
It is conservatively predicted that through the "dual zone linkage" in 2021, only the first seven companies in the Linyi Comprehensive Pilot Zone can achieve exports to Europe exceeding 100 million euros, an increase of over 20% year-on-year.
Cross-border e-commerce becomes a new bright spot
The epidemic has brought about the prosperity and development of e-commerce. In 2020, Hungary's e-commerce will grow strongly.
Compared with the same period in 2019, e-commerce sales in the first quarter of 2020 increased by 21%, and the second quarter increased even more, reaching 47%.
Online sales in Hungary in the first 9 months increased by 30% year-on-year, an increase of approximately 1.5 billion euros.
The data shows that the sales growth in 2020 will be mainly concentrated in the fields of computers, assembled furniture, food, medicine and household products.
Except for the anti-epidemic materials and equipment that are urgently needed in Central and Eastern Europe, the goods arriving from China through the China-Europe Railway Express are roughly in line with the types of goods that are popular online in Hungary.
Liu Bo said: “Cross-border e-commerce cooperation will be another bright spot for China-Hungary cooperation in the future. Emag, the largest e-commerce company in Central and Eastern Europe, and Arukereso, the largest e-commerce company in Hungary, are in contact with Chinese companies. Alibaba and other e-commerce and logistics companies are also Interested in expanding the market in Hungary. It has been successfully held for 6 sessions in Budapest, and the largest Chinese brand merchandise exhibition in Central and Eastern Europe. This year, the transfer to the "cloud" promotion is an exploration path for the digital display of Chinese goods in the future."
Hungarian Minister of Foreign Affairs and Foreign Economic Affairs Sialto stated on multiple occasions that Hungary is China's best partner in Europe. The two countries have experienced strong economic and trade growth, showing a healthy and sound development momentum.
Liu Bo said: “This kind of confidence and advantage has become more resilient after the impact of the epidemic, and the pace of China-Hungary friendly cooperation will not change. It will promote Hungary to share more opportunities for China’s development. Create brilliance."