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RIO Country Report Hungary 2016

The annual RIO Country Report offers analysis of the R&I system in Hungary, including relevant policies and funding, with particular focus on topics critical for EU policies. The report identifies the main challenges of the Hungarian research and innovation system and assesses the policy response.

 
 

Executive summary

Title: 
Highlights

  • In Hungary the economy grew by 2.9 in 2015 and is expected to remain relatively stable in 2016-2017.
  • The budget deficit has been kept under the 3% level since 2012. Between 2013 and 2015 the budget deficit was further decreased from 2.6% of the GDP to 2.0%.
  • The Hungarian industry is characterised by the dominant role of foreign controlled companies and strong export orientation. Foreign controlled enterprises accounted for 57.4% of the total production value in the Hungarian economy in 2014.
  • The unemployment rate in Hungary has been constantly decreasing since its peak in 2011 of 11.2% down to 7.7% in 2014 and 6.8% in 2015. The main active policy tool to achieve this result has been the Government’s public work scheme.
  • Although Hungary is still a service-driven economy, during the past five years the share of industry (gross value added, % of GDP) has grown from 21.9% to 22.9% between 2010 and 2015 (without the construction sector).
  • GERD has shown an upward trend with a rather strong growth rate between 2008 and 2013. At the same time R&D funding by the government has not increased proportionally. Contribution from the private sector grew faster and since 2007 the private sector has been the main contributor to GERD. The structural funds are a major source for R&D funding.

Title: 
Main R&I policy challenges

  • Fostering innovation in domestic enterprises. The level of innovation activities among the Hungarian companies is generally low, especially that of SMEs. A major reason for that is the high concentration of R&D activities in large multinational companies. It has been a high priority of the government to boost business R&D in the last decade through tax incentives and direct measures supporting business R&D.
  • Enhancing the cooperation between science, higher education and business. Supporting cooperation between business and academia has been a high priority of the STI policy in Hungary that resulted in a number of positive developments such as the growing number of corporate research centres and R&D labs. As these partnerships usually last until they run out of public funding, sustainability of the cooperation is a real challenge.
  • Reinforcing the R&I governance and transfer mechanisms. Frequent changes in the institutional set-up of the Hungarian R&I system have led to a situation in the financing period 2014-2020 in which R&I governance lacks experienced employees. The recently established centralisation of all major R&I resources could potentially speed up and simplify the access to RDI funding resources.
  • Supplying the R&I system with high-skilled human resources. Currently the level of human resources of science and technology (HRST) is still lagging behind the EU average. Since 2013 the number of R&D units and the number of R&D personnel has been decreasing, although differently in the various sectors. The government tries to turn about this trend and puts a lot of emphasis on the reform of higher education, focusing on more S&E graduates, strengthening the doctoral studies, and forming long-term basis of the R&D funding of HEIs.

Title: 
Main R&I policy developments in 2016

Geo coverage
Report year
2016
Official publication date
Monday, 8 May, 2017
Last update: 24/10/2017 | Top | Legal notice | Contact | Search