Investments decreased by 3.0% in the 4th quarter of 2023
The volume of investments decreased by 3.0% in the 4th quarter of 2023 compared to the same period of the previous year, and increased by 1.5% compared to the 3rd quarter (seasonally adjusted). Most sections of the national economy contributed to the general investment decrease. Manufacturing as well as real estate activities related investments, having a dominant weight, held back, while public administration and energy industry related developments increased the performance of the national economy. In 2023, the volume of investments decreased overall by 8.5%, year-on-year.
In the 4th quarter of 2023, seasonally adjusted:
The seasonally adjusted volume of the national economy’s investments increased by 1.5% compared to the 3rd quarter. Within it the volume of construction investments grew by 3.1%, while investments in machinery and equipment lessened by 1.3% compared to the level of the 3rd quarter.
In the 4th quarter of 2023 compared to the same period of the previous year:
The volume of the investment activity lessened by 3.0%. Within it, construction investments, representing about 60% of the total volume of investments decreased by 4.1%, investments in machinery and equipment, representing 40% of the total value of investments lessened by 1.1%.
The volume of investment in the case of enterprises employing at least 50 people, realising 53% of the investment performance decreased by 3.8%, in the case of budgetary units, realising 18% of investments, developments grew by 43% then the level of previous year, owing primarily to technical reasons1. The volume of other investments (enterprises with fewer than 50 employees, individual enterprises, non-profit ones as well as households) was below the one year earlier level by 18%.
In the current period, the performance value of investments fell in twelve out of nineteen sections of the national economy. Growth dynamics of manufacturing, representing the largest weight, accounting for almost one-third of investments in the national economy, slowed in the past quarters; in the fourth quarter developments decreased by 3.1% compared to the base period. This is mainly explained by the single-digit reduction of the investment volume in the manufacture of electrical equipment, having the largest share, mainly due to the gradual winding down of large-scale projects going on for a longer time. At the same time, the volume of investments in transport equipment production, representing the second largest weight, grew dynamically, developments in several domestic transport equipment manufacturing factories contributed to this trend. Growth was also recorded in investment within the subsections of metal processing and metallurgy as well as machinery and equipment manufacturing and electronics industry, while several other subsections decreased in varying degrees.
The investment performance of real estate activities, the second largest investor, accounting for 21% of developments in the national economy fell by 5.6% compared to the same period of the previous year. The volume change was determined mainly by the high investment activity of a year ago, mainly for housing renovation.
Investment volume in transport and storage were approximately on the same level as in the previous year, one of the main factors being that public infrastructure development did not decrease compared to the previous year.
The section of public administration increased the volume of investments very dynamically, by 29%, due to the expanding developments in central public administrations.
The reason of the 21% volume decrease in wholesale and retail trade was the decrease in the investment activity of the enterprises active in both retail and wholesale trade in the current period; as these stimulated the growth in the same period of the previous year.
The investment performance of energy industry grew by 7.0%, where an increase in development related spending by enterprises active in the generation and supply of electricity played an important role.
Investment outlay of the national economy*
| Section | Quarter 4 of 2023 | Quarters 1 – 4 of 2023 | ||
|---|---|---|---|---|
| at current prices, billion HUF | volume change, compared to the corresponding period of the previous year, % | at current prices, billion HUF | volume change, compared to the corresponding period of the previous year, % | |
| Total | 5 903 | -3.0 | 16 119 | -8.5 |
| Of which: * | ||||
| manufacturing | 1 899 | -3.1 | 5 203 | 4.5 |
| real estate activities | 1 217 | -5.6 | 3 234 | -17.6 |
| transportation and storage | 623 | 0.2 | 1 767 | -11.1 |
| public administration | 383 | 29.1 | 718 | 4.5 |
| wholesale and retail trade | 243 | -20.8 | 814 | -14.0 |
| energy industry | 233 | 7.0 | 581 | -6.2 |
* Data of the 6 largest weight carrying sections, based on investment performance of the given quarter.
The 3.0% volume decrease of the national economy’s investments in the 4th quarter of 2023 was partially offset by the public administration and energy industry (by 1.4 and 0.2 percentage points). At the same time the reduction in investment performance in real estate activities, manufacturing and wholesale and retail trade, all contributed to the lower volume (by –1.2, –1.0, –1.0 percentage points).
In 2023 compared to the previous year:
The volume of investments in the national economy decreased by 8.5%, within it the volume of construction investments fell by 15%, at the same time investments in machinery and equipment expanded by 1.6%.
Investment performance decreased in the case of enterprises employing at least 50 persons, providing 54% of investments, by 6.4% and expanded by 13% in the case of government bodies. The latter is mainly due to technical reason (see footnote 1).
For the year as a whole, investment decreased in all but five sections. Among the most important investing sections, investment grew by 4.5% in manufacturing, which accounts for 32% of performance value, in contrast, the volume in real estate activities, representing 20% of the national economy’s investments fell by 18%. The volume in transportation and storage, representing 11% of the national economy’s investment volume decreased by 11%. These three sections accounted for more than six-tenths of investment value.
Trade, the fourth largest area of investments, fell in volume (-14%), at the same time the volume in public administration increased by 4.5%.
Developments in the sixth largest section, agriculture, decreased by 17%.