Industry and tourism hit hard by pandemic

Due to factory closures and supply chain disruptions, industrial production has fallen to levels unseen since the summer of 2017. With the collapse of tourism, guest nights also began to plummet in March. Revenues of commercial accommodation providers shrank by 60 percent.

In March 2020, working-day adjusted data showed that the volume of industrial production was 10 percent lower than one year earlier. The impacts of the economic turmoil due to the pandemic were already significant during this period.

Among the most significant manufacturing subsectors, there was a substantial decline in vehicle manufacturing, while the production of computer, electronic and optical products increased slightly. However, growth in the production of food, beverages and tobacco became more intensive. In most other subsectors, the volume of production decreased.

Due to factory shutdowns and restrictive measures, the industrial output may have reached its lowest point in April, after which, as a result of the easing of restrictive measures and the expected recovery in exports, industrial performance is expected to get back to normal.

Nose-dive in tourism

As expected, the pandemic led to the total collapse of tourism.

In March, the year-on-year decrease in the number of nights spent by foreign and domestic guests in commercial accommodation (hotels, boarding houses, campsites, bungalows and community accommodation) was 68 per cent and 61 per cent, respectively.

The total gross sales revenue of commercial accommodation providers, at current prices, was 60 percent lower, amounting to about HUF 14 billion.

In tourism, the recovery is expected to be very slow, mostly due to the limited number of foreign visitors. Nevertheless, one can see that European countries, including Hungary are mitigating the damage caused by the pandemic with easing travel restrictions and supporting the industry.