New four year EBRD strategy for Hungary

After investing nearly €3 billion in Hungary since its first project in 1991, the European Bank for Reconstruction and Development (EBRD) has not yet finished but instead announced a new four year plan to be put in place.

One of the main priorities of this plan is to help the banking sector in its ability to lend. Privatisation is also to be supported as will sector consolidation to provide long-term funding. The NPL resolution will also continue to be supported as the Bank attempts to enhance the framework. This is a continuation of the Memorandum of Understanding which was signed by the government in February 2015 and aims to make the banking sector more efficient and effective.

Furthermore, energy efficiency was also a big winner as there is to be a clear focus on optimising storage capacities and efficiency on the whole. Big infrastructure projects will be given the Bank’s support which include a potentially huge investment involving the development of a ‘Hungarian gas exchange’ and the progress of two-way gas flow. The fight for more efficient energy is still strong and the EBRD has promised its support in energy saving activities.

In addition to this, small companies will be able to find more funding than before in hopes that the market will become more competitive and local companies will have a chance to compete with the bigger firms. There will be a particular focus on those operating in ‘less developed regions’; the EBRD hopes that all markets will become fair and competitive with the chance for every company to succeed, big or small.