BMI's Executive Summary

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There has been a marked shift in the economic performance of Hungary since its accession to the European Union (EU) in May 2004. The Hungarian construction industry is forecast in the vicinity of US$7.74bn by 2012. A number of rail and road projects are underway and the bulk of construction spending is expected to find its way to the nation's transport segment. This report forecasts the Hungarian construction industry to grow at an annual average of 8.88% over 2008-2012.

EU funding is likely to increase public sector orders for construction and, in turn, boost the Hungarian construction industry, which is already the fourth-largest industry in the nation. The public procurement market is expected to expand rapidly, following the introduction of a new public procurement act, allowing EU-registered firms to bid for Hungarian tenders without links to a local company or local reference projects. The EU funding programme and Hungary's second National Development Plan, envisage huge spending on railway development and on water infrastructure during 2007-2013. The government's privatisation plans could also provide an impetus to the infrastructure sector. One of the major projects at the feasibility stage in 2007 is the US$6.38bn South European Gas Pipeline (SEGP).

However, the Hungarian construction industry may face a slowdown on the housing front in 2007, as according to the Central Statistical Office (KSH), volume of construction activity has decreased by 15.8% in June 2007 compared to the same period a year ago. Meanwhile, intense competition and the need to cut costs have led to the use of a large number of illegal construction workers, especially from Ukraine and Romania.

On a positive note, the government is planning to overhaul Hungary's tax system in 2009 and hike levies on property and personal wealth. The country's central bank, Magyar Nemzeti Bank (MNB), expects investment activity to pick up in 2008. BMI forecasts the Hungarian construction industry to reach a value of US$4.82bn in 2007 and further to US$7.7bn by the year 2012.

Chapter 1 - Executive Summary

Chapter 2 - Industry Trends And Developments

Market Overview

Hungary’s Economy In 2006

Hungary’s Construction Industry In 2006

Major Companies

Some Recent Investment Initiatives

Chapter 3 - Key Projects

Transport

Utilities

Tourism

Residential And Commercial Construction

Table: Hungary – Major Infrastructure Projects

Table: Hungary – Major Infrastructure Projects (continued)

Chapter 4 - Business Environment

Introduction

Table: Emerging Europe Business Rankings

Business Attractiveness Rankings – Methodology

Regional Overview

Hungary Business Environment Ranking

Long-term Economic Risk

Long-term Political Risk

Construction Growth

Competitive Environment

Anticipated Potential

Chapter 5 - SWOT Analysis

Hungary Infrastructure SWOT

Hungary Political SWOT

Hungary Economic SWOT

Hungary Business Environment SWOT

Chapter 6 - Industry Forecast Scenario

Table: Hungary Infrastructure – Historic Data And Forecasts

Risks

Chapter 7 - Macroeconomic Outlook

Table: Nominal And Real GDP

Chapter 8 - Country Snapshot: Hungary Demographic Data

Section 1: Population

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education And Healthcare

Table: Education

Table: Healthcare – Vital Statistics

Table: Healthcare – Expenditure

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption And Stratification

Table: Wages Per Annum

Chapter 9 - Competitive Landscape

Table: Hungarian Construction Industry – Key Players

Chapter 10 - Company Monitor

Vegyepszer

KÉSZ Central European Building and Construction

Strabag Hungary

Bouygues Group

Chapter 11 - BMI Forecast Modelling

How we generate our Industry Forecasts

Construction Industry

Sources

Chapter 12 - Appendix: Regional Demographic Data

Table: Wages (ave labour force per annum), US$ PPP

Table: Population

Table: Household Spending Per Capita, US$

Table: Private Consumption Per Capita, US$ PPP

Table: Market Size, US$bn

Competitive Landscape for Europe Infrastructure Reports: Sample of Companies Ranked

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Comparative company analyses and rankings by sales, % market share, employees, registration date and ownership structure. Company profiles include fully researched senior executives and contact details, business activity and leading products and services. SWOT (strengths, weaknesses, opportunities, threats) of the state’s business environment, infrastructure sector, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Network of European Infrastructure Sources

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BMI's European Infrastructure Reports are based on an extensive network of multilateral organisations, government departments, infrastructure industry associations, chambers of commerce and company reports. Information sources include: