Bordering seven other European countries, Hungary occupies a strategic location in Central Europe.  Hungary is a member of the European Union, the North Atlantic Treaty Organization, and the Organisation for Economic Co-operation and Development.  As with many Central and East European economies, the transfer from a planned to a market economy has not been easy for Hungary, and it suffered greatly during the transition and subsequent global recession.  Compounding its problems, Hungary has suffered from an uncertain political climate since the election of a centre-right government led by Prime Minister Viktor Orban in April 2010.  Mr. Orban’s tenure has been marked by controversy, including criticisms that press freedom has been curtailed, and that Orban’s government has undermined the independence of the central bank and constitutional court.  As a result, Hungary’s relationship with the European Union has been tense at times.

The Hungarian currency, the forint, has suffered from the uncertainty, but there are signs that the Hungarian government has moderated its stance.  In recent weeks, Mr. Orban’s government has appeared to have toned down its inflammatory rhetoric and expressed willingness to work more closely with the European Union toward further economic reforms.  Hungary nevertheless remains an attractive place to do business because of its highly educated, literate population and relatively low labor costs.  Because Magyar, the predominant language spoken in Hungary, is unlike any other European language, most younger Hungarians are fluent in several other languages, and many study and work abroad before starting a career in Hungary. 

Industry, services and agriculture make up the bulk of Hungary’s economy, and Hungary remains a popular tourist destination.  Hungary’s main industries include mining, textiles, chemicals, including pharmaceuticals, and metallurgy.  Germany is Hungary’s most important  trading partner, and the United States is Hungary’s sixth largest export market.  Approximately 80% of Hungary’s trade is with other OECD countries.  

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