Hungary Economy and Culture


The first among the Eastern European countries to have initiated a policy aimed at economic liberalization, Hungary found itself having to face a difficult transition phase between the abandonment of the socialist system of production and the full adoption of the market capitalist one. which required a substantial commitment from the State in the management of production activities. The action taken by Hungary had as its primary objective the recovery and strengthening of ties with Western and Central Europe, which weakened after the Second World War following the country’s entry into the Soviet area of ​​influence, also orienting itself towards a closer relationship with the United States, also underlined by the entry into NATO. Having emerged from the Second World War in absolutely disastrous conditions, Hungary had made extensive use of Soviet aid for the reconstruction of its productive apparatus, a very marked dependence on the economic settings of the Soviet Union.. From 1947 the Hungarian economy was governed by development plans which had the objective of transforming an eminently agricultural country into a predominantly industrial one; agriculture was reorganized on the basis of a radical reform which, eliminating large properties, focused on the creation of cooperatives, while industry (nationalized like almost all economic sectors) was systematically strengthened to the detriment of other activities. Within it, basic productions were clearly privileged to the detriment of those destined for consumption. The discontent of large sections of the population resulted in the well-known insurrection of 1956, which was followed by an undoubted attempt by the government to implement a more flexible and more adequate programming to the demands of the country, but always within the limits imposed by a rigidly centralized and disciplined economic system. But in 1968 the change was radical: without questioning the fundamental principles of a country with a socialist economy, a gradual decentralization of planning was initiated, new criteria of competitiveness and corporate profit were adopted, the formation of prices for some products. it was left to the pure mechanisms of the market. This liberalization process (which has been accompanied more and more by a strengthening of the private economy) has had an undoubted positive effect thanks also – in truth – to the copious inflow of foreign capital, which, causing an increase in the standard of living, has spread in the population an increasingly consumerist mentality, also laying the foundations for inevitable social tensions.

In fact, during the 1980s and early 1990s, unemployment increased significantly, before settling on average levels towards the end of the decade (7% in 1999) before falling to a discreet 5.9% in 2003. A similar trend was recorded. inflation, which went from 25.6% in 1996, to 10.3% in 1999, to 4.7% in 2003. In both cases, the first years of the 21st century recorded extremely positive data if compared to those of the immediately following the country’s exit from the communist bloc. Towards the end of the nineties there was a slight decline in exports, offset by the increase in domestic demand, while the trend of the beginning of the 21st century is positive, with a trade balance very close to the breakeven point thanks to the increase in export related to capital goods. The economy has further strengthened, integrating more and more with that of the EU, until the country’s official entry into the Union itself, which took place on 1 May 2004. A large part of exports (approximately four-fifths of the total value of trade) are directed towards the other Member States, and the main imports (over two thirds). Significant flows of foreign investments continue to flow into the country, ensuring significant and good level industrial growth; in 2003-2004, in line with the trend recorded in previous years, the wealth produced recorded an increase of approx. 3%. (in 2008 the GDP per capita was equal to $ 15,284 US), while the value of the public deficit remained worrying (around 6%), to curb which the government decreed a sharp cut in spending. Despite the progress, the competitiveness of Hungary on the international scene is not particularly good, since the country, in 2004, occupies only 25th place in the annual ranking drawn up by the IMD, while in 2003 it was in 22nd place.


According to ethnicityology, there is something special about Hungarian culture that makes it unique within the framework of the member countries of the European Union: a vague taste of exoticism (not too invasive, just like that typical of paprika) that blends harmoniously with the magnificence and the austerity of the traces of the Habsburg rule. The numerous Turkish baths scattered throughout the capital, the unusual combinations of gastronomy and the gypsy melodies speak of historical events that have been able to enliven and enrich the heritage of a people. But it is the same Hungarian idiom, which in Europe finds correspondences only in Finnish and Estonian (Finno-Ugric stock), to tell us about a cultural uniqueness that the Hungarians have always proudly defended. Stubbornly tied to its heritage, Hungary has been able to express itself at the highest levels especially in music and dance, disciplines that have always had excellent exponents (among them the composer B. Bartók stands out) and which continue to be extremely popular. Despite the considerable destruction caused by the Second World War, there are still many artistic and architectural testimonies and numerous are the sites declared by UNESCO. World Heritage Site; among these we can mention the banks of the Danube and the district of the castle of Buda in Budapest, the early Christian cemetery of Pécs and the monastery of Pannonhalma. The most prestigious university in the country, based in Pest since the end of the 18th century, is dedicated to Eötvös Loránd, the physicist who invented the torsion balance in the 19th century, while in the artistic field the main institution is the Hungarian High School of figurative arts (Budapest, 1908).

Hungary Culture