FX Excursions

FX Excursions offers the chance for once-in-a-lifetime experiences in destinations around the world.

Budapest: Fair Trade

by Gtrav

May 1, 2006
2006 / May 2006

The great River Danube has the power to divide and to unite. Both of these forces have defined Budapest, capital of Hungary. Until the 19th century, the city did not exist as a single entity, but rather as a cluster of three distinct towns: Buda and Obuda on the hilly west bank of the river, and Pest on the relatively flat east bank. They merged under the current name in 1873, and are linked now by numerous bridges and an efficient subway system.

Of the city’s three components, the largest (accounting for about two-thirds of the total area) is Pest, which has thrived for centuries as a commercial center, benefiting from the flow of international trade along the Danube (or Duna, as it is locally known).

This great waterway, which winds its way for 1,890 miles from Germany to the Black Sea, passing through Austria, Slovakia, Hungary, the Balkans, Bulgaria and Romania, has been a vital European trade route since Roman times, and in 1997 it was formally identified as a Pan-European Transport Corridor. There are 10 such corridors, which are intended to form an integrated network of road, rail and river links. Four of these corridors pass through Budapest, confirming its strategic position at the geographic heart of Europe.

Despite its location in the center of the continent, Hungary remains an anomaly. It has been invaded and subjugated throughout its history, but the indigenous Magyar people, who make up 95 percent of the current population, maintain a proud culture that is quite different from neighboring countries. The Hungarian language is part of the Finno-Ugric family of languages, thought to have evolved in Central Asia, and is horrendously difficult to learn.

Although English is increasingly being adopted as the lingua franca of business here, the local tongue remains one of the chief impediments facing foreign companies. The services of an expert translator are often essential for business meetings and for dealing with official paperwork. Ironically, modern Hungary’s complex bureaucracy is not so much the legacy of its Communist past as a symptom of its recent (May 2004) membership of the European Union. As part of the E.U., the country is subject to a raft of new laws and directives, many of which apply to individual businesses.

Communism is an increasingly distant memory in Budapest. The city never sat comfortably behind the Iron Curtain, and in 1956 it attempted to leave the Warsaw Pact, only for the Soviet Union to send in the tanks and execute the leaders of the rebellion. Bullet holes in many of the city’s buildings still bear testament to the bloody uprising 50 years ago.

The economy became more market-orientated throughout the 1980s, and by the time the Soviet Union collapsed in 1991, Hungary was better placed than any other Eastern European country to make the transition to capitalism. Since then, Hungary has boasted one of the fastest growing economies in Europe. In the past 10 years, the annual rate of growth consistently has been between 3 and 5 percent. The buoyant economy, combined with political stability (unlike other Eastern Bloc countries, in which political crises are common, Hungary’s elected governments have always served their full terms), has created ideal conditions for foreign investment.

Since 1990, foreign companies have invested more than $25 billion in industries such as manufacturing, trade, banking and services. U.S. companies have accounted for about 30 percent of this vast sum, the majority of which has been focused on Budapest; the city generates more than a third of Hungary’s GDP.

The feeding frenzy of the 1990s, during which many of the national corporations were privatized and were snapped up by foreign companies, is now largely over. But as Hungary continues to strive to meet the criteria to join the European Monetary Union, which will result in the adoption of the euro as the official currency, there are still many attractive opportunities for foreign investors.

Budapest has a particularly strong tradition in the sciences. Having already given the world, among other inventions, the ballpoint pen and Rubik’s cube, it continues to be a hotbed of innovation. Research and development, biotechnology, and electronics are among the industries that offer great investment potential. Perhaps the brightest star in the economy at the moment is information technology. The industry has been expanding at a rate of 10 percent each year, and now accounts for 8 percent of the total GDP. Leading the way is the 17-acre InfoPark (www.infopark-budapest.hu), Budapest’s answer to Silicon Valley. This state-of-the-art development already employs more than 4,500 people, and is home to a range of international companies, including IBM, Hewlett-Packard and Panasonic.

Not all of Budapest’s inhabitants have reaped the rewards of the new market economy. In a recent survey, 23 percent of the respondents said that they would favor a return to Communism. Domestic and corporate taxation remains high by European standards, and is one of the factors that has led to an estimated 500,000 Hungarians subsisting in the “gray economy,” conducting business in cash in order to avoid taxes.

Encouragingly, though, most Hungarians are optimistic about their country’s economic prospects, and are confident they soon will reap the benefits of EU membership. In the coming years, the EU will provide funding for numerous major infrastructure projects, including the upgrading of the rural road network.

Meanwhile, Budapest has become a popular short-break destination for European tourists, and is also attracting increasing numbers of visitors from America and Asia. The city was once dismissed as a “poorman’s Vienna,” but that billing was unjustified. With its beautiful historic architecture, its hills riddled with fascinating caves (where else can you go caving within a major city?), and more than 100 natural thermal springs supplying dozens of luxurious spas, Budapest is one of Europe’s most interesting cities.

And through it all runs the Danube, the mighty river that divides the city, and at the same time unites it with the rest of Europe.


Entry Requirements

U.S. citizens must have a valid passport to enter Hungary. Visas are not required for stays of less than 90 days.

The Embassy of Hungary
3910 Shoemaker St., N.W.
Washington, D.C. 20008
tel 202 362 6730
www.huembwas.org


More Information

The American Chamber of Commerce in Hungary
H-1052 Budapest, V,
Deák Ferenc u. 10, 5th floor
Hungary
tel 36 1 266 9880
www.amcham.hu

Hungarian Investment and Trade Development Agency
H-1061 Budapest
Andrassy u. 12
Hungary
tel 36 1 472 8100
www.itdh.hu

Introducing

FX Excursions

FX Excursions offers the chance for once-in-a-lifetime experiences in destinations around the world.

Explore Excursions

#globility

Insta Feed
Daily
Apr 4, 2025

Spring Hotel Openings from IHG Hotels & Resorts

IHG Hotels & Resorts adds to its portfolio with hotel openings around the world this spring.

Royal Air Maroc Marks Five Years with oneworld: Strengthening Connectivity Between USA and Africa and Expanding Global Reach

Royal Air Maroc proudly enters its fifth year as a member of the prestigious oneworld alliance. Since joining in April 2020, RAM has demonstrated resilience during the COVID-19 pandemic, emerging as a dynamic airline that enhanced its digital services and expanded its network. The airline plans to grow its fleet to 200 aircraft by 2037, reinforcing its global presence.

Daily
Apr 4, 2025

Sloane Stanley Estate: One of London’s Best-Kept Secrets

Situated within one of London’s most prestigious neighborhoods, Sloan Stanley Estate in Chelsea spans more than 250 shops, maisonettes and homes, and is considered one of the city’s best-kept secrets. Dating back to 1717, Sloane Stanley Estate brings together a wide range of design, food, drink and wellness brands.

Daily
Apr 3, 2025

Greek Hotel Brand Goes Big for Easter

Traveling for the Easter holidays this season? These Zeus International Hotels & Resorts destinations in Attica and Crete offer traditional Greek Easter experiences.

Madrid: The Charm of an Authentic City

They say Madrid is in vogue for many reasons: its lifestyle, its heritage, its cuisine and all of its new attractions. And it’s true, because Madrid is on the radar of travelers looking for a cutting-edge destination that still holds onto its essence. Join us as we explore its charms.

Daily
Apr 3, 2025

Spa All Day at The Ritz-Carlton, Bachelor Gulch

The Ritz-Carlton, Bachelor Gulch in Beaver Creek, Colorado, invites travelers to rejuvenate with two new wellness experiences for spring and summer: Spa All Day and Wellness Retreats. These experiences take place at the 21,000-square-foot The Ritz-Carlton Spa, Bachelor Gulch, which boasts 19 treatment rooms and amenities including a steam room, cold plunge and Himalayan Salt Wall Dry Sauna.

Find Your Perfect Escape with Paradisus by Meliá — More Than Just All-Inclusive

Luxury travel today is about more than just beautiful accommodations — it’s about experiencing the destination. Paradisus by Meliá takes traditional all-inclusive resorts to the next level by offering indulgence with immersion, experiences and authenticity. Each resort is shaped by its location, local flavors and curated Destination Inclusive® experiences that bring you closer to the heart of the destination.

Airlines
Apr 2, 2025

Air France Unveils New La Première Experience

This spring, Air France unveils its newest, most luxurious La Première experience yet. On select Boeing 777-300ER aircraft, Air France gradually debuts four suites, each nearly 11.5 feet large. The first of these launches this spring, boasting five windows, a seat, chaise lounge that converts to a true 6.5-foot-long bed and more.