Outlook on China-Hungary Bilateral Trade and Investment Relations

China and Hungary have had a strong relationship since 1949, with significant exchanges in energy and infrastructure. Hungary plays a key role in economic ties between China and Central and Eastern European countries. The two nations support each other’s interests and cooperate in various areas, with bilateral trade reaching $14.52 billion in 2023. Major projects include a high-speed rail connecting Budapest and Belgrade, with Hungary welcoming increased Chinese investment in key sectors.

The relationship between China and Hungary dates to October 1949, during the first week of the formation of the People’s Republic of China. Over the years, this bilateral relationship has fostered significant exchanges in energy and infrastructure. Diplomatic ties between the two nations remain strong, characterized by regular high-level visits and dialogues. Both countries actively support each other’s core interests and cooperate within multilateral frameworks, including the United Nations and the China-Central and Eastern European Countries (China-CEEC) cooperation mechanism.

As a member of the 17+1 cooperation framework, Hungary plays a pivotal role in facilitating economic ties between China and Central and Eastern European countries. Hungary was the first European country to sign the BRI cooperation document with China, which aligned with Budapest’s “Eastern Opening” strategy. This enhanced bilateral practical cooperation in trade, investment, finance, and other areas. In fact, Hungary is the third-largest trade partner of China in the Central and Eastern European area, while China remains Hungary’s largest trade partner outside the European Union. In 2023, bilateral trade volume surged to US$14.52 billion, marking a remarkable 73 percent increase since 2013.

A major highlight of their cooperation is China’s financing of a high-speed rail project connecting the capitals of Hungary (Budapest) and Serbia (Belgrade).

Furthermore, the China (Xi’an) – Hungary Economic and Trade Cooperation Exchange Meeting, held in Budapest in June 2024, reflects Hungary’s eagerness for increased Chinese investment in sectors like modern agriculture, food processing, machinery manufacturing, geothermal and photovoltaic energy, and tourism.

China and Hungary have maintained robust bilateral trade cooperation, overcoming challenges and achieving substantial growth over the years. According to the China Economic Information Service (CEIS), bilateral trade between the two countries reached US$14.52 billion in 2023, representing a 73 percent increase compared to 2013.

The focus of this trade relationship lies in high-value-added machinery, electrical equipment, and advanced technology products. Specifically, the following categories of items account for over 80 percent of the bilateral trade volume: electric motors, electrical equipment and components; boilers, machinery and parts; vehicles and parts; and optical, photographic, and medical equipment and components.

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