“We had municipal elections in October, and much to everybody's surprise, the opposition to Prime Minister Viktor Orban did quite well,“ reports Tamas Szabo, Managing Partner at Szabo, Kelemen & Partners in Budapest. “The opposition took the Mayorship of Budapest and around half of the districts in the capital – this is very surprising, especially given that Orban holds a two-thirds majority in the Parliament. This shows that the opposition is still alive, but it remains to be seen if this signifies a new trend.“ He notes that the Prime Minister and his political party remain popular in the countryside.
Despite the recent success of the opposition, Szabo says that he expects few dramatic legislative changes. “The Government has been in power for ten years," he says, "and for the first eight or nine it was very active in passing new laws, so I do not expect anything of note to happen.“ Indeed, he says, even the constitutional amendments that were rumored to be coming are “now off the table, following the municipal elections of last year."
Turning the discussion to the economy, Szabo reports that the HUF is suffering, noting that "in the last year, the HUF went down some 6% against the EUR and 10% against the dollar." According to him, this may, in addition to everything else, have consequences on the legal industry, and suggests that "it may lead some law offices, for example, to start charging for their services in a foreign currency."
Still, he says, overall things are going well. “The economy grew some 5% last year, and with 4% the year before that we can see that the trends are favorable – we have a projected growth of 4% for 2020.“ Of course, he's conscious of the cyclical nature of the global economy. “We see a clear fear of a downturn, of a crisis, being present,“ he says. “Things have been going strong for a long time now, we’re all just waiting for some bad fortune to get us.“
Finally, Szabo reports that Real Estate remains a strong sector in Hungary, along with banking, insurance, and retail. “Still, we have problems in Real Estate due to construction slowing down because we have a dwindling labor force,“ he says. The auto industry is doing well too, he says, with “BMW recently setting up and Audi and Mercedes expanding their operations in the country.“
