Published on: 26 November 2020

In the 3rd quarter of 2020 investments decreased by 12 % compared to the same period of the previous year and by 2.1% in comparison with the previous quarter.

Based on raw data in the 3rd quarter of 2020 the volume of developments was 12% lower compared to the same period of the previous year and by 2.1% (seasonally adjusted) compared to the previous quarter. Investments declined in most sections, however in relation with the pandemic situation in healthcare they almost doubled. In addition investment volume grew in several, overall smaller weight carrying fields e.g. trade (6.3%), information, communication (3.4%), public administration (2.1%). The general decline in investment was mainly due to larger companies, among these especially foreign-owned enterprises and state-owned companies moderated their developments. During the first three quarters of 2020 investment volume declined in total by 8.6% compared to the high base of the previous year.

In the 3rd quarter of 2020, seasonally adjusted:

The seasonally adjusted volume of national economy investments decreased by 2.1% compared to the previous quarter. Within it the seasonally adjusted volume of construction investments decreased by 4.4%, while investments in machinery and equipment grew by 2.2%.

In the 3rd quarter of 2020 compared to the same period of the previous year:

The volume of investment activity decreased by 12%. Within it construction investments representing close to six-tenth of the total volume of investments decreased by 16%, investments in machinery and equipment representing more than four-tenth of the total value of investments fell, by 6.2%. In the case of these two aforementioned indicators this is the most unfavourable change since 2017, which in the case of construction investments is mainly due to the shrinking amount of the EU funds.

The volume of investments in the case of enterprises employing at least 50 people and realising 55% of investment performance – exceeding the decline registered in the previous quarter – decreased by 18%, where the insufficient market demand generated by the coronavirus (COVID-19) epidemic and the unnecessary free capacities created in the previous periods played a prominent role. At the same time in the case of budgetary units, realising 16% of investments, developments were down in a small proportion, by 7.2% compared to the base period, partially as a result of the smaller volume decrease of implemented EU-financed projects.

Investment performance declined in more than half of the sections of the national economy. Developments in the largest weight representing manufacturing – being responsible for almost one quarter of investments – significantly fell (by 18%) in the 3rd quarter. Within it developments decreased widely in the vast majority of the subsections, in an outstanding degree in the great weight representing manufacture of transport equipment, in the manufacture of machinery and equipment n.e.c. as well as in the manufacture of chemicals and chemical products. At the same time - due to previously started high-volume projects - in some subsections the volume of the current period increased significantly, for example in the fields of manufacture of electrical equipment, other manufacturing, and the manufacture of pharmaceutical products.

The investment performance of real estate activities realising 17.5% of total investments, was also greatly reduced in the 3rd quarter: by 12%. Along the moderate growth in dwelling constructions, developments oriented toward business facilities for rent (e.g. logistics halls) dropped significantly.

The measure of decrease in the third largest field, transportation and storage accelerated (by 26%), caused mainly by the reduction of infrastructural developments. Moreover investments of market-oriented enterprises engaged in transportation and storage also fell behind compared to the base period.

Certain fields of the general government contributed differently to the performance change of the national economy’s investments. The volume increased by 2.1% in the case of the 4th largest investor, public administration – mainly through procurement by central administrations. In connection with the epidemiological situation, through outstanding developments in the in-patient care area the investments in human health and social work activities almost doubled (98%). In the arts, entertainment and recreation – primarily due to the lower expenditure of the competitive sport projects – investments decreased by 36%. In the case of water supply and waste management the investment decrease of 21% surpassed the national economy’s average as well.

In the field of wholesale and retail trade, carrying the fifth largest weight, investments increased (by 6.3%), where enterprises operating in wholesale trade, and in wholesale and retail trade and repair of motor vehicles and motorcycles increased their investments.

Investments in the sixth largest field, agriculture, forestry and fishing fell (by 5.6%), where mainly larger companies reduced their investment in domestically produced machinery.

In several smaller weight carrying branches of the national economy developments have increased significantly. Investments grew remarkably (by 48%) in the energy industry, mainly through developments in nuclear energy. Investments in professional, scientific and technical activities have grown outstandingly (by 31%), mainly as a result of office developments executed in Hungary by service centres. Investments also grew moderately in the field of information and communication (3.4%) where the construction of telecommunication towers also played a role.

Performance value and volume change of national investments

Section Quarter 3 of 2020 Quarters 1 - 3 of 2020
at current prices,million HUF volume change, compared to the corresponding period of previous year, % at current prices,million HUF volume change, compared to the corresponding period of previous year, %
Total 2 504 315 -12.0 6 599 100 -8.6
Of which:*
manufacturing607 130-18.21 752 079-8.5
real estate activities437 368-11.91 175 448-3.6
transportation and storage381 871-26.3975 585-15.7
public administration, defence and compulsory social security160 5602.1350 913-17.5
wholesale and retail trade, repair of motor vehicles and motorcycles134 0886.3347 382-1.3
agriculture, forestry and fishing115 727-5.6351 0076.5

* Data of the six largest weight carrying sections, based on investment performance of the given quarter.