Annals of the University of Oradea: Economic Science (Jul 2018)
SUSTAINABLE COMPETITIVENESS OF HUNGARY - FOCUSING ON THE YEARS 2013-2017
Abstract
By the change of regime in the late 1980s and early 1990s, the entire population of Hungary was expecting the transformation of the economy and society and hoped to catch up with the Western European standard of living. More than 25 years have passed since then, but Hungary is still lagging far behind, not only in the West, but also in some areas in the Central and Eastern European Union. Following the joining to the European Union in 2004, Hungary has failed to use Community resources over the past 20 years to boost the economy and put it in the path of sustainable development and competitiveness. The concept of competitiveness and its types changing by time. Looking at a country, competitiveness means being able to provide an attractive and sustainable environment for businesses and residents to settle, operate or work. Regarding job creation, the role of SMEs remains to be prioritized in the Union. Given that the world economy is in a major transformation, which is primarily driven by digitalization and robotization, it is worth examining the digital competitiveness of each country as well. But where does Hungary stand in this competition within the community, or compared to the neighbouring countries? This study seeks to answer the above question, based on the annuals of OECD and IMD, and the yearly SBA reports of the European Union. The analysis leads to the conclusion that the former key factors underlying the attractiveness of the Hungarian economy, are increasingly starting to wear out. Now concerning renewal, no progressive signs can be seen. In order that the long-term sustainable economy of the country is built on a good foundation, much stronger social cohesion and solidarity should be implemented, than ever. To establish these, principally the existing (and unfortunately increasingly widening) income and wealth gap between social groups, should be mitigated, by catching up wages and pensions. Furthermore it is essential to improve the quality and transparency of public administration, to make the regulatory system predictable, and to prevent corruption at all levels. Moreover it is necessary to increase awareness of the need to preserve the natural resources, and of the importance and indispensability of expertise. It is also substantial, that there is no sustainable competitiveness without an innovative society. This means competitiveness does not at all, only depend on the technological advances or the organization and operation of the economy, but basically is a function of social behaviour. Only the open, flexible, satisfied, consecutively adaptable, whilst also cooperative and solidarity-based societies are capable to provide a sustainable foundation for economic and technical competitiveness.
