Hungary's exports to Russia fell 52% year-on-year in the first three months and the agriculture sector' losses amounted to HUF 27 bn, Gyula Budai ministerial commissioner told Magyar Hírlap in an interview.
Damages from lost investment can only be estimated, Budai said, pointing out the example of failed investment by Russia's biggest food retailer. Magnit was planning to set up a logistics centre in Eastern Hungary near the Ukraine border, which would have created some 1,500 jobs. The project was called off in August 2014 after Russia introduced an embargo on Western food products in a counter measure against a similar move by EU countries.
Bilateral trade relations have seen a spike in 2013, with Hungarian exports to Russia reaching EUR 3 billion in that year. Besides food producers, the pharmaceutical and machinery sectors are suffering from the loss of orders, which was aggravated by the plunge in the Russian currency and tensions in Ukraine.
To minimalise the impact of the embargo, the government took steps to curb the flood of imported products to the Hungarian market and at the same time help producers find new opportunities in the Balkans and the Middle and Far Eastern markets.
When asked about the prospects of lifting the embargo against Russia, Budai was skeptical. „I don't like to go into a guessing game, but taking into account chancellor Merkel's stance on Russia at the last G7-summit, the sanctions will remain in place”, he told Magyar Hírlap.
