The Hungarian - Philippine Economic Relations

The Philippines and Hungary have friendly and problem-free bilateral economic and trade relations.

After the visits of the President of the Republic of Hungary to the Philippines in February 1998, and the visit of the former President Mr. Fidel Ramos, brought about a more enhanced economic interaction between the two countries, which has somehow cooled down recently, due perhaps to both external and internal economic and political effects.

Direct business contacts between Hungary and the Philippines are not sufficiently frequent, participation in each other’s trade fairs is sporadic, delegation visits are yet to be exchanged.

The bilateral legal and institutional background is well in place, with aims to serve the expansion of bilateral economic relations between Hungary and the Philippines. Both countries are WTO members. While bilateral trade is regulated by EU law as since 2004, the Agreement on Scientific and Technical Cooperation and the Agreement on the Avoidance of Double Taxation, two more agreements were signed during the visit of President of Hungary in Manila in1998. One of them regulates tourism, the other one the cooperation between the two countries' chambers.

Hungarian imports showed respectable increase in the late 90’-ies until 2003, especially in the field of computers and entertainment electronics. These two groups of products are decisive in the purchases from the Philippines. In the past ten years, Hungarian imports from the Philippines rose first from 8 million dollars to 63million, and again to 430 million USD (in 2002). Thereafter a set back followed, due certainly to the adverse effect of international trade competition from the region. In 2007 the totalled in 174 MUSD. Obviously, this traditional Philippine surplus in bilateral trade is partly due to the fact that the products of the Philippines enjoy in Hungary the advantages stemming from the EU’s Generalized System of Preferences.

The structure of bilateral trade show a dominance in both ways of the IT related products: components and parts of computers, telephones (manufactured b the multinational companies). In Hungarian export other important items are: lamps, transformers, pharmaceutical products, tyres, steel and oil products and equipments.

In the Hungarian imports from the Philipppines the additional main items are: electric products, food products, textiles, apparels, shoes.

The Hungarian government intends to increase the country's exports to the Philippines (and to South-East Asia, as well) and also the flow of foreign direct capital from that region into Hungary. To reach a counterbalance in the substantial deficit existing in our trade with the region is aimed not by cutting the imports from there but by increasing Hungarian supplies. The Hungarian companies are able to supply EU standard technologies and services for development projects in many fields: such as the vehicle industry (buses, transmissions), the energy sector (transformers, power plants, substations and high-voltage cables), as well as equipment for education, health, agriculture, water and food industry.

Trade between Hungary and the Philippines

Value: USD million