A Sass, M., Vlčková, J.: The impact of state activism on domestic multinationals: The case of Czechia and Hungary bejegyzés először VGI-én jelent meg.

Article by Magdolna Sass on the Institute of World Economics’ blog

Over the past two decades, China’s share of the world economy’s total FDI stock has grown rapidly. While in 2000 the country’s share was negligible, by 2023 it accounted for nearly 7% of the total stock, according to UNCTAD data. This rapid growth contrasts with the stagnating share of the other BRICs and the slightly or significantly declining share of the leading developed economies (especially the US). Since 2009, China has been the „podium” country in terms of annual outward FDI inflows every year, mostly behind the US and ahead of Japan in the ranking. Nevertheless, there have been years when China has been the largest source of outward FDI in the world economy: for example, in 2014 or 2020. In 2022, China accounted for more than 10% of total annual outward FDI in the world economy, and in 2023 for more than 9.5%. Including Hong Kong, these shares are more than 17% and more than 16% respectively (UNCTAD). (Further growth is likely to continue, as outward FDI in China accounted for 16% of GDP in 2023, compared to an OECD average of 52% and even around 20% for Central and Eastern European countries.)

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A Hungary is the recent European leader in Chinese investment: but who benefits? bejegyzés először VGI-én jelent meg.

Author: Andrea Éltető

ELKH KRTK, Institute of World Economics, Working Paper Nr. 271 (2023) June 2023

Abstract

The significant expansion of Hungarian domestic electric vehicle battery manufacturing capacity by early 2023 has become a major topic of public debate in the country. South Korean battery factories have been operating in Hungary since 2019 with Asian-owned suppliers and further Asian plants have been established since then. This paper presents the various aspects of scaling up battery production, drawing on official documents, press information, studies, statistics, and video and audio material. It shows how the functioning plants operate in Hungary, how industrial safety and environmental regulations are breached, and what the attitude of local authorities and civil groups is. The study evaluates the location factors like availability of workforce, energy and water, pointing out their scarcity. There is also a painful lack of responsible cost-benefit analysis, a credible and flexible government strategy and fact-based information.

A Éltető, A.: Aspects of electric vehicle battery production in Hungary bejegyzés először VGI-én jelent meg.

Authors: Marta Götz, Andrea Éltető, Magdolna Sass

In: European Journal of International Management, 2023 Vol.20 No.1, pp.66 – 88

DOI: 10.1504/EJIM.2022.10054592

Abstract

The economic development of Central European countries has been based on foreign capital investments. Attracting FDI by influencing foreign investors’ decisions remained an important goal. Investment decisions are complex and affected by behavioural, subjective factors too. In this paper we investigate how digitalisation changes FDI decision making and what are the consequences for the location advantages of Poland and Hungary. We also aim to assess the reshoring prospects for these countries due to pandemic induced digitalisation and disruptions in global value chains. We have found that digitalisation changes the Dunning OLI paradigm advantages and influences the investment decision-making process. The location advantages of Poland and Hungary have not improved enough in modern digital technologies and have worsened in skilled labour supply. To compensate for these, attractive incentives are offered for foreign investors, which can maintain the momentum of FDI temporarily, but in the new era of Industry 4.0, government policy should invest more in digital skills and education.

Keywords: Poland, Hungary, I.40, digitalisation, attractiveness, FDI

A Götz, M., Éltető, A., Sass, M.: Still attractive for FDI? Location advantages of Visegrád countries in the digital era – the case of Poland and Hungary bejegyzés először VGI-én jelent meg.