Foreign investors must realize that besides the benefits that investing in Hungary brings, there are challenges that investors face. Although we cannot completely resolve these problems, we can help to alleviate them.

Key issues of investing in Hungary

• Recruiting and Training
  Certain white-collar skills can be in short supply. Western firms may have trouble finding and retaining local employees with skills in finance or accounting, human resources, purchasing and electronic data processing. Employees with both business skills and proficiency in Western languages can be difficult to recruit, and they command premiums over average Hungarian salary levels.
  Unemployment has persisted around the 6% level, but Hungary’s labor force participation rate of 57% is one of the lowest in the OECD. Unemployment and lower levels of economic development are generally more pronounced in the eastern half of the country. In contrast, there is now a shortage of labour in some of the more-developed regions. A persistent problem has been long-term unemployment, and nearly half of the unemployed falls in this category.
  Although the Hungarian workforce is generally skilled and well educated, many of the unemployed are unskilled or older workers who might be difficult to retrain and place elsewhere. A severe housing shortage in most parts of the country limits labour mobility, with Budapest the most-affected area. Professional relocation is still uncommon in Hungary.
• Unstable Financial Situation
  Depsite holding one of the highest Central European transition economies, ratings agencies have expressed concerns over Hungary's unsustainable budget and current account deficits.
• Rapidly changing tax, legal and regulatory environment
  In addition to the corporate tax and Value Added Tax, Hungary’s municipalities levy taxes on corporations operating in their jurisdictions. There are thousands of localities applying many different types of tax, and at different rates. Although these taxes are likely to be phased out soon, due to their potential non-compliance with EU tax regulations, they still do exist today and cause confusion among many foreign firms doing business here.