2004 - Kongsberg to fix faulty devices - Századvég: Fidesz further increased its advantage - The number of EU‘s supporters decreases 04.05.2004 - Fidesz more popular 05.05.2004 - Hungarians are pessimistic 06.05.2004 - Is the government preparing for an additional restriction? 07.05.2004 -István Farkas to be appointed to lead PSZÁF FOREIGN AFFAIRS 04.05.2004 - What do we expect from the European Union accession? MACROECONOMY 03.05.2004 - The real sphere is more optimistic 04.05.2004 -Central bank lowering cutting base rate - Unified labour database starts operation 05.05.2004 - When to introduce euro? 07.05.2004 - State budget figures better than expected BANK 03.05.2004 - Erste concentrating no the merger - Dresdner Bank stays - Investment support from EIB - Konzumbank approves merger with MKB - OBA to undertake guarantee up to HUF six million 04.05.2004 - Inter-Európa bank opened branch bank with promotion 05.05.2004 - Deposit interests can sink - Julius Bar heading to Hungary 06.05.2004 - Budapest Bank to strengthen its position regarding foreign exchange credit - Raiffeisen closed a successful quarter - Mitsubishi Bank to enter Hungarian market? 07.05.2004 - OTP and BB to decrease deposit rates INSURANCE 04.05.2004 - Legal title insurance from the United States HEAVY INDUSTRY 06.05.2004 - 15 million euros investment at Audi - Positive news on NABI CHEMICAL INDUSTRY 03.05.2004 - Nitrokémia closing its nitro-cellulose plant 04.05.2004 - Decreasing profit at Richter ENERGY INDUSTRY 06.05.2004 - E.On Hungária to rise capital BUILDING INDUSTRY 03.05.2004 - GVH to make decision in the cartel case till June 05.05.2004 - Kanizsa Kft. went bankrupt 06.05.2004 - Another penalty for construction companies ELECTRONICS 05.05.2004 - Philips closing its plant in Székesfehérvár, fate of supplier Pannonplast plant in doubt TELECOMMUNICATION 03.05.2004 - MKB and Strabag going to T-Mobile 07.05.2004 - HTCC to buy PanTel Rt. INFORMATION TECHNOLOGY 03.05.2004 - Fujitsu Siemens bringing a service centre to Hungary 07.05.2004 - Online advertising market expanded FOOD INDUSTRY 03.05.2004 - Kométa regains its export licence - Mineral water is popular - Rush for sugar started from a misunderstanding 04.05.2004 - Kométa looking for its previous partners 05.05.2004 - Alpenmilch enters Hungarian market - Parmalat Hungária to take out a HUF 700 million loan 06.05.2004 - American market leader bidding for Pick 07.05.2004 - Fruit processing plant under construction in Nyírtass - Nissin moves production to Hungary - Slaughterhouses for sale! 2

AGRICULTURE 04.05.2004 - Agrarian companies up for grabs 06.05.2004 - Hog problem on the Austrian-Hungarian border TRADE, FAIRS 03.05.2004 - Metro fattens on Central Europe 04.05.2004 - Marking the European Union accession with milk - BMW Magyarország launched 06.05.2004 - Benetton stays in the inner-city - Outlets to open up in autumn TRAFFIC, TRANSPORT 04.05.2004 - Freight transportation with restrictions 05.05.2004 - Additional flights from Sky Europe TOURISM, HOSPITALITY 06.05.2004 - Low fare flight to Lake Balaton? INVESTMENT, DEVELOPMENT 04.05.2004 - Four in the running for M6 concession - Irish invasion in the housing market - Úttörõ Áruház sold 06.05.2004 - Savoya Park to be handed over in the autumn - Prague is leading 07.05.2004 - Another motorway construction agreement to be signed today - TriGránit also in the running for M6 TAX, SOCIAL INSURANCE 07.05.2004 - Union not approving simplified business tax


INTERNAL AFFAIRS - 03.05.2004 Kongsberg to fix faulty devices
Experts at the Purchase and Safety Investment Office of the Defence Ministry (Honvédelmi Minisztérium Beszerzési és Biztonsági Beruházási Hivatala) have agreed with UHF tender winner Norwegian Kongsberg that the company would fix faulty devices till December. The Ministry would like Kongsberg to pay a forfeit after the devices that were not meeting technical specifications and it would even have a right to back out of the agreement, however, this latter solution is not backed by the Ministry. (NG, p 5)

Századvég: Fidesz further increased its advantage
According to the analysis of Századvég in April Fidesz maintains its significant advantage in the popularity ranking of parties. Among secure party voters the largest opposition party leads with 12 percentage points. But the judgement of the Medgyessy cabinet‘s activity somewhat improved, but still 65 percent of the voters have a negative opinion about the government‘s work. The support of EP lists increased by one percent in case of Fidesz, decreased by 2 percent in case of MSZP, the opposition party leads with an advantage of 18 percent and besides the two large ones only the support of SZDSZ exceeds the 5 percent that is necessary to obtain the mandate. Among all respondents the support of Fidesz was 33 percent, that of socialists was 24 percent and 53 percent of respondents stated that if elections were taking place this Sunday, they would go to vote. (MH p15)

The number of EU‘s supporters decreases
Nearly one year after the EU referendum and three weeks before the accession almost one-third of the Hungarian population completely and further 48 percent mainly supports the country‘s EU membership – reveals the survey that was executed by Medián upon the assignment of Magyar Hírlap. Support somewhat decreased since the referendum, since then almost every second citizen believed in accession. Change is spectacular especially among citizens of the capital: a year ago they supported the accession more than the average and now less than the average. But the opinion of each party‘s voters seems permanent: voters of the government party, mainly those of the smaller coalition party are happy about Hungary‘s EU membership. (MH p15)

INTERNAL AFFAIRS - 04.05.2004 Fidesz more popular
Figures from all pollsters show that opposition party Fidesz Hungarian Civic Alliance is more popular than senior governing Hungarian Socialist Party. The largest opposition party had a 37 percent supporter base according to data by Medián, whilst corresponding figures at other public research institutes Tárki and Szonda Ipsos stood at 33 percent each. Data from Gallup shows that Fidesz could have 31 percent of votes, should voting be held this Sunday. As for the socialists, Medián gives them 23 percent of votes from the total population, whilst Tárki and Szonda put their support base at 24 percent and Gallup at 20 percent. Smaller parties would not reach the 5 percent threshold necessary to enter the Parliament with junior coalition partner Alliance of Free Democrats SZDSZ at 4 percent at Tárki and Gallup. When it comes to those with a certain party preference, Fidesz would have 58 percent with Medián, 53 percent with Szonda Ipsos and 50 percent with both Tárki and Gallup. Corresponding figures for the Hungarian Socialist Party stand at 34 percent with Medián, 38 percent with Tárki, 33 percent with Gallup and 37 percent with Szonda Ipsos. Among decided voters, SZDSZ would have 6 percent at Tárki, 5 percent at Szonda Ipsos and 8 percent at Gallup. As for Medián, those turning up to vote for sure would favour Fidesz and MSZP to the ratio of 56 to 36 percent, whilst the corresponding figures are 54:36 at Tárki and 48:36 at Gallup. Alliance of Free Democrats would have 4 percent according to Medián, whilst Tárki forecasts 6 percent and Gallup 9 percent for the junior coalition partner in the June European Parliamentary elections. The survey, conducted by public research company Capital Research, commissioned by Political Capital reveals that 40 percent of voters with a decided party preference would support the Fidesz list against 39 percent of Hungarian Socialist Party. As for all the interviewed, the ration is 28 to 30 percent. SZDSZ and Hungarian Democratic Forum MDF would get 8 percent of votes. (NSZ, p 3, MH, p 3)


INTERNAL AFFAIRS - 05.05.2004 Hungarians are pessimistic
Western Europeans are more satisfied with their life standard than people living in countries that has recently joined the EU. Among the ten new member states Hungary is only ahead of Poland in the ranking; 24 of fellow Hungarians are satisfied with their life standard – reveals the survey of Target Group Index. Half of Czechs and Slovakians look forward to EU membership with hopes; according to two-thirds of them the membership guarantees the stability of their country. In Hungary 30 percent of respondents thought that their life conditions will improve by the accession. (Nszab p25)

INTERNAL AFFAIRS - 06.05.2004 Is the government preparing for an additional restriction?
Until the European Parliamentary elections the preparations about an additional Draskovics package including restrictions of HUF 300 million for this year have been suspended – learned Világgazdaság. The financial cabinet is afrad that additional fiscal restrictions could possible harm the popularity of governing parties. The saving measures are necessary in order to achieve the planned 4.6 percent state budget deficit. At the end of March the finance minister denied that the Ministry of Finance would be working on additional restrictions. (VG p1,)

INTERNAL AFFAIRS - 07.05.2004 István Farkas to be appointed to lead PSZÁF
Prime Minister Péter Medgyessy announced yesterday, on the day the law on the protection of depositholders and investors took effect, that he would like to appoint István Farkas to head Hungarian financial market watchdog Pénzügyi Szervezetek Állami Felügyelete (PSZÁF)) as the chairman of its supervisory council. The final nomination comes from the President after a suggestion coming from the Prime Minister, but before that, corresponding parliamentary committees are conducting talks with the candidate. Farkas hopes that before selecting members of the supervisory council, they will ask for his opinion. Farkas was appointed the chairman of Eximbank Rt. and Mehib Rt. in October 2002. Prior to that, he had been managing his own advisory company FI-AD Financial Advisory Rt. (FI-AD Pénzügyi Tanácsadó Rt), mainly specialising in advising on pension fund investments. (NG, p 4, NSZ, p 4)

FOREIGN AFFAIRS, EUROPEAN UNION - 04.05.2004 What do we expect from the European Union accession?
A survey by public opinion research institute Tárki reveals that those expecting a noticeable increase in salaries went down in numbers, however, those that expect larger unemployment in the European Union are more and more with vast majority expecting higher prices. The survey was conducted together with Tárki?s Polish and Slovakian partners. Other results include the opinion that Hungary can contribute to the European Union with its culture, arts, scientific accomplishments and hard-working nature. Slovakians think that they can give the Union their touristic opportunities and creativity, whilst the Poles their traditions, well-trained society, the chance for an open market and agrarian products. (MH, p 3)

MACROECONOMY - 03.05.2004 The real sphere is more optimistic
EU membership accelerates modernisation processes and extends them to areas, where they were effected in a lower degree up to now – states the latest forecast of GKI. According to the forecast growth stood on an export driven path. According to researchers in the next few months inflation will continue to increase, but in the second half of the year decrease is expected, thus the rate will be around 6 percent by the end of the year and the annual average will be approximately 6.7 percent. GKI‘s professionals expect GDP growth to be 3.7 percent, the deficit of the balance of current payments to be 6.5 billion euros and the foreign trade deficit to be 4.6 billion euros. This year Ecostat counts on a deficit of 5.7 billion euros in the balance of current payments. This exceeds the forecast that was announced a month ago by 1 billion euros. The 57-point value of Ecostat‘s Top-100 index suggests that executives of respondent companies count on the continuance of the fast growth path. SMEs are also optimistic concerning the future, though in a smaller degree only. (NG p4, VG p5, MH p17)


MACROECONOMY - 04.05.2004 Central bank lowering cutting base rate
The Monetary Council of the National Bank of Hungary cut the central bank base rate by 50 basic points to 11.50 percent effective May 4. The Monetary Council said that the risk assessment of the Hungarian economy has improved over the past months. The timing of the decision took market analysts by surprise, saying that the central bank’s decision is a sign that next week’s inflation data is going to be better than expected. Most analysts are of the opinion that expectations that the base interest rate would go down to 9.5 percent by the end of the year were well-founded, meaning that further cuts are in the offing. Callum Henderson, chief emerging markets strategist at Bank of America, however, is not that sure that rate level of under 10 percent can be achieved by the end of the year. The BoA expert added that central bank decisions are following not economic developments, but rather market movements. Yesterday’s decision was brought about by neither budget deficit nor current account figures ‘ Henderson added, telling that Prime Minister Péter Medgyessy has put pressure on the central bank governor so that the base rate goes down to a single-digit one by the end of the year. The National Bank of Hungary has increased the base interest rate by 300 basis points last November, citing reasons of a drastic worsening of country risks. (NG, p 1 and 3, MH, p 9, VG, p 1 and 13)

MACROECONOMY, LABOUR - 04.05.2004 Unified labour database starts operation
The new Unified Hungarian Labour Database (EMMA) was put into operation on Monday. The database aims at making the labour market more transparent. EMMA contains the data of more than 2.5 million employees and more than 300,000 employers. The system was put into operation on Monday by Minister of Employment and Labour Sándor Burány. Employees can now request a special PIN code at the employment offices of their residence, after which they can call down their data from EMMA both by telephone and the Internet, asking for example whether they are reported and with what kind of data, basic wage, etc. Besides personal data of employees, also in the database are basic wage, length of working time and qualifications. Enterprises do not have to report current labour relations, since they are already included in the database, only modifications have to be reported. EMMA can be available by calling 185 or under (MH, p 11, NSZ, p 3)

MACROECONOMY - 05.05.2004 When to introduce euro?
The target date for adopting the euro will be set next week by the government - Finance Minister Tibor Draskovics announced. The government has been holding talks and at present is also discussing its plans with employers and employees, experts from parties and has ordered studies from five economic research institutes for HUF 3 million each. It is the economic cabinet that will discuss the draft today, taking into account different implications, then the government will have the fist reading of it to set the target date next week. (At the same time, the government will present its convergence program to the European Commission.) Four out of the five research institutes are of the opinion that the euro can be introduced in 2009 or 2010. However, Growth Research Institute, led by György Matolcsy expressed its opinion that there was no ideal date. They added that more important than the exact date was that the government’s economic policy stresses the importance of growth and has a perfect timing for the -jumping stage- of the economic expansion. Draskovics, having a positive opinion of the central bank’s base interest rate cut of Monday, reacted to the researchers- standpoint that to meet Maastricht criteria with no pain, a wide-ranging social and economic agreement was necessary, which is put back by political division in the country. Deputy State Secretary of the Finance Ministry Álmos Kovács stated that a 3 percent GDP- proportionate budget deficit can be reached by 2007-2008 and he added that the largest problem could be defining the appropriate exchange rate for the accession to the ERM-II exchange rate system. (NG; p 1 and 3)


MACROECONOMY - 07.05.2004 State budget figures better than expected
Excluding local municipalities the state budget closed the month April with a deficit of l 112 billion forints, as a result of this the loss of the first four months adds up to 547.6 billion forints, which figure is more than 46 billion forints better than estimated. This is 46.2 percent of the annual plan. The central state budget closed the fourth month with a deficit of 61.9 billion forints and this is significant lower than expected. In addition to this the balance of the social insurance’s financial founds and the isolated national funds met the expectations. According to expert opinion of the financial portfolio, deficit will increase to 1043 billion forints in the first half of the year, however the loss will not increase further in the second half of the year. (MH p11, NG p3, VG p4)

BANK - 03.05.2004 Erste concentrating no the merger
Postabank’s Friday annual general meeting approved the bank's annual report for 2003 with net losses of HUF 5.5 billion. Shareholders approved a motion to dip into profit reserves to make up for the losses. Postabank General Manager Péter Kisbenedek said that the bank’s 2004 business plan has been defined by the merger with Erste Bank Hungary. The post-merger bank's total assets will rise 15 percent in 2004 and 14 percent in 2005. Erste Bank also had its annual general meeting on Friday. The AGM approved the board's proposal to retain all of last year's HUF 1.4 billion profit into reserves in preparation for the planned merger with Postabank this autumn. The bank has decided not to pay dividend. (VG, p 19)

Dresdner Bank stays
Under the decision of the mother company, Dresdner Bank (Hungaria) Rt. will continue its operation in Hungary. In the future the daughter bank will continue to concentrate on medium and large corporate customers. The management will not change, the headcount of employees is expected to rise, but establishing a branch network is not among plans. The company that achieved losses lower than planned last year expects break-even for next year. (NG p5)

Investment support from EIB
On Friday four Hungarian financial institutes signed an agreement about a non-repayable support of 7.2 million euros with EIB. CIB Bank, Magyarországi Volksbank Rt., Erste and Raiffeisen will spend the amount on financing municipalities that participate in the Global Loan programme. Volksbank has already placed half of the available 40 million euros and by the end of the year it might use the whole limit. Erste counts on supporting investments of HUF 4 billion. (VG p19, Nszab. p15)

Konzumbank approves merger with MKB
Friday's annual general meeting of Konzumbank approved the bank's 2003 annual report that shows net losses of HUF 219 million and year-end total assets of HUF 105.2 billion. The AGM approved the merger with Hungarian Foreign Trade Bank MKB. The merger is set to take place in the summer. (VG, p 18)

OBA to undertake guarantee up to HUF six million
As of the moment of accession the National Deposit Insurance Fund (OBA) insures money put into the bank up to HUF 6 million instead of the former HUF 3 million. Protection concerns all existing deposits, the amount on the account and the receivable embodied by bank securities (bond, deposit note). The self-part introduced last year for deposits larger than one million remains, thus in case of a deposit of 6 million, compensation is full up to HUF one million, but between 1-6 million OBA only pays 90 percent of the deposit. Another change concerning the bank is that as of May 1st any bank having a seat in the EU can open a branch in Hungary and Western banks already operating here can transform into branches. Customers of new branches are governed by the deposit insurance regulations valid at the given credit institute‘s seat. (MH p13)

BANK - 04.05.2004 Inter-Európa bank opened branch bank with promotion
Inter-Európa Bank opened up a new branch bank in the 13th district of Budapest. The bank offered an individually promoted deposit for the new clients of the office: clients who lock-up at least 500 thousand forints for 3 months will receive an annual interest of 11 percent. The promotion takes until May 31st. According the financial institution’s plans the network will be further expanded, they intend to implement three new branch banks in the capital and in other towns. (VG p14, MH, p13)

BANK - 05.05.2004 Deposit interests can sink
According to market experts, after the issuing bank’s interest cut retail deposit interests can soon also decrease. But it is possible that banks will be waiting until the next interest cut of MNB (National Bank of Hungary) and will only act after that. Since favourable macroeconomic processes allow additional cut of the base rate. Currently banks pay the best interest for deposits fixed for two and three months; some promotions are still in force, among others at CIB, Raiffeisen, Budapest Bank and K&H (Commercial and Credit Bank). (VG p18)

Julius Bar heading to Hungary
Julius Bar considers partnership with a Hungarian market player. Raymond Bar, president of one of the largest Swiss banks, said: the strength of the financial institute is its size, since it is a significantly thinner organisation than Credit Suisse and UBS, therefore it can set foot in areas, where the large ones cannot break into. (VG p17)

BANK - 06.05.2004 Budapest Bank to strengthen its position regarding foreign exchange credit
The foreign exchange credit portfolio of Budapest Bank increased to 21.5 billion forints by the end of April. The bank „Deviza Lombard” credit (foreign exchange Lombard credit) is available for the bank’s clients as of February in addition to this „Deviza Alfa” credit (foreign exchange Alfa credit) is available as of March. The financial institution plans to implement additional development and expansion in the business line foreign exchange credit accommodation. (VG p17)

Raiffeisen closed a successful quarter
Raiffeisen Bank achieved a balance sheet footing of 889 billion forints at the end of the first quarter of the year, which represents an increase of 42 percent, the company’s gross profit added up to 6.7 billion forints that is an expansion of 43 percent. Based on the figures more favourable than expected the financial institution can be able to achieve its goal of this year that is to realise a profit before taxation of 21.3 billion forints. This amount would exceed last year’s figure by 10 percent. Being out of accord with former data the bank achieved higher profit arising from deposits and not the credit accommodation business line in the first three months. Compared to figures posted at the end of December the bank realised a growth in the credit portfolio of only 0.8 percent, however compared to the base figure it adds up to an increase of 36 percent. On the other hand the deposit portfolio expanded by 6.6 percent in the first three months, which means a growth of 87 percent in annual comparison. According to Raiffeisen’s expectations a dynamic upswing will take place in the credit accommodation business line as of the second quarter of the year. The growth expected by the bank will arise from two sectors: on one hand credits based on foreign exchange in the retail banking sector and winning new customers the corporate sector. The number of corporate clients increased by 5 percent last year. (NG p4, VG p19)

Mitsubishi Bank to enter Hungarian market?
Bank of Tokyo-Mitsubishi intends to expand its activity in Central-Eastern-Europe – can be red in Kyodo News. According to expectations of the financial institution more and more Japanese companies discover the new member states of the European Union. The company handed over offices in Warsaw and Vienna up to the time being. (VG p18)

BANK - 07.05.2004 OTP and BB to decrease deposit rates
National Savings Bank OTP has come up with new interest rates on retail deposits in the wave of Monday’s base rate cut. Thus, deposits linked to retail and Junior current accounts with a fix interest rate went down by 0.5 percent, whilst yield of savings notes for more than a year decreased 1 percent. Other banks also followed in the footsteps of OTP: Commercial and Credit Bank K&H Bank has re-priced its products right on the day after the rate cut, whilst Budapest Bank has pushed down the interest rates of its retail deposits by an average of 0.5 percent. Erste and Postabank are set to define new conditions next week. (VG, p 14)


INSURANCE - 04.05.2004 Legal title insurance from the United States
First American Title Insurance company intends to introduce its services in the Hungarian market as well – can be red in Budapest Business Journal. Slovakian distributor Andrew Jackson said: the company could not be active in the Hungarian market because there was a barrier due to the Hungarian insurance law, however owing to the EU law harmonisation this impediment can be terminated. Legal title insurance can be available for real estate transactions. (VG p15)

HEAVY INDUSTRY - 06.05.2004 15 million euros investment at Audi
The investment of Audi Hungária Motor Kft. in a value of 15 million euros is finished. Owing to this project the production of driving rods for four-cylinder diesel engines could be launched. The manufacturing plant produces 12 thousand rods daily. Thomas Faustmann managing director of the company said: by producing the driving rods, the factory in Gyõr managed to increase its depth in diesel engine production and due to this the company ensures its competitive strength within Volkswagen-group in the future. (NG p4, VG p6)

Positive news on NABI
Bus maker NABI Rt increased its consolidated first-quarter sales from USD 79.5 billion a year earlier to USD 93.9 million in the first quarter of the year. The 30.2 percent increase was due to new sales of 60 LFW buses and CompoBuses. The spare parts division posted a 9.5 percent growth in sales revenue. However, the company’s performance was adversely impacted by a weak US dollar and costs of the recent restructuring of the company’s debt. NABI reported net loss of USD 870,000 between January and March, down from USD 1.4 million in the same period last year. NABI announced that chairman of the First Hungarian Fund (Elsõ Magyar Alap) Martin Adams was selected ad the new Chairman of the Board of the bus manufacturer. (VG; p 17)

CHEMICAL INDUSTRY - 03.05.2004 Nitrokémia closing its nitro-cellulose plant
Hungarian state-owned chemicals company Nitrokémia Rt closed its loss-making nitro-cellulose plant. The closure means that 150 jobs are cut, whilst a further 100 employees are still working. State Privatisation and Holding Company ÁPV Rt. has sold the gunpowder division, also making losses, to Hungarian-Russian chemicals company Milrus Service. (VG, p 11)

CHEMICAL INDUSTRY - 04.05.2004 Decreasing profit at Richter
The sales revenue of pharmaceutical company Richter drifted downward from 28.6 billion to 28.2 billion forints in the first quarter of the year. The turnover in dollars increased by 7.8 percent. The income from operations decreased from 7.,8 billions to 6.6 billion forints, profit before taxation eased off from 8.6 billion to 7.5 billion forints and the post-tax profit decreased from 8.2 billion to 7.5 billion forints. The market share of the company reduced to 8.4 percent. According to the company’s expectations the sales revenue in dollars will rise by 10 percent regarding medicaments delivered to the EU region, by 15 percent to the ex Soviet Union countries, while there can be an increase in the turnover of 15-20 percent towards Russia. (VG p15, NG p 11, Nsz p 10))

ENERGY INDUSTRY - 06.05.2004 E.On Hungária to rise capital
E.On Hungária Rt. will implement a share capital increase of 250 million euros in two steps. The company will spend this amount on network development. The 80 thousand kilometres long network is extended by 1700 kilometres a year. They plan to build 10 electric substation, in addition to this the company leads negotiations with Magyar Energia Hivatal (Hungarian Energy Office) on the implementation of two international lines 120 kilovolts each at the borders Hungary-Slovakia and Austria-Hungary. E.On invested 1.7 billion euros in Hungary up to now and took 23 million euros out of the country as dividend. (VG p16)


BUILDING INDUSTRY - 03.05.2004 GVH to make decision in the cartel case till June
Economic competition watchdog GVH has already finished investigations at three motorway construction companies, charged with acting in a cartel. Documents are to be checked by the competition office, however, other documents necessary for the decision to be made are still not ready. This is likely to take place already this month and the competition watchdog can make a decision soon afterwards. GVH has become suspicious after realising that the consortium of Hídépítõ and Betonút, selected for the construction of the stretch of motorway M7 to Ordacsehi and Strabag Rt, the winner of construction works between Becsehely and Letenye plus the consortium of Egút Rt, and Delmút Rt., the winning bidder for the M3 stretch between Polgár and Görbeháza have all tabled bids very similar in value and after learning that all bidders have come out as winners. (NG, p 5)

BUILDING INDUSTRY - 05.05.2004 Kanizsa Kft. went bankrupt
Kanizsa Kft., one of the largest construction companies of Zala County has recently reported bankruptcy, since it could not agree with creditors about the rescheduling of debts. The company executed a headcount reduction of 50 persons before the announcement. The owners and the management of the company would like to sell the firm that has a debt of HUF 200 million in the quickest possible way, in an operable condition. Kanizsa Kft. currently has receivables under lawsuit of HUF 70 million and the value of its property is nearly HUF 100 million. (NG p5)

BUILDING INDUSTRY - 06.05.2004 Another penalty for construction companies
According to information form FigyelõNet, Economic Competition Office (Gazdasági Versenyhivatal) has imposed fines on construction companies again on charges of acting in a cartel. The reasoning says that Egút and Strabag have acted together in the contest for the preliminary works of South-Buda metro line, priced at HUF 4 billion. The competition watchdog decided that Egút has to pay HUF 56 million with Strabag fined HUF 137 million. (NG, p 4)

ELECTRONICS - 05.05.2004 Philips closing its plant in Székesfehérvár, fate of supplier Pannonplast plant in doubt
Philips Magyarország is moving production of LCD monitors from Szombathely to its Székesfehérvár plant between July and September on the back of capacity implications. Philips' statement said the move is in line with the corporate restructuring programme of Philips' Entertainment Electronics division, aimed at simplifying the organisation and cutting costs in order to improve international competitiveness. As a result of the relocation, Philips Magyarország is to cut 370 jobs in Szombathely, while staff numbers will increase in Székesfehérvár. As daily Népszabadság learnt, the move might lead to the closure of Moldin Kft., the subsidiary of Pannonplast with 300 employees. The daily writes that the company got more than 80 percent of its orders from Philips Magyarország. Three plants of the plastic product manufacturer (in Szombathely, Székesfehérvár and in Budapest) are producing spare parts necessary for monitors. Should Philips decide that it would have them from the Székesfehérvár plant, those in Szombathely might end up without work. An even worse solution for Pannonplast can be the one in which the Dutch company is choosing Jászberény-based Plasztik Kft. as its supplier, since it might lead to losses of income to the tune of HUF 1.5-2 billion for the plastic manufacturer. Szombathely has already gone through a trauma in connection with Philips last year when traditional CRT monitor production was moved to China and 500 jobs were cut as a result. Philips yesterday presented its statement to the Vas County Labour Office on the staff reduction of an even larger than in the original announcement 392 persons. Together with the recent firing at shoe factory Marc, a total of more than 1,000 people will be unemployed in the town. (NSZ, p 5, Nszab, p 1)

TELECOMMUNICATION - 03.05.2004 MKB and Strabag going to T-Mobile
Strabag Építõ Rt., a leading market player on the Hungarian construction market with sales revenue reaching HUF 100 billion annually is to take its 1,200 mobile subscriptions to Westel, operating under the name of T-Mobile already. The move has been made possible by the opportunity of number portability. At the same time, Hungary’s third largest credit institution (based on total assets) Hungarian Foreign Trade Bank MKB is also going to have most of its subscriptions from T- Mobile. (NG, p 5)

TELECOMMUNICATION - 07.05.2004 HTCC to buy PanTel Rt.
Dutch telecommunication company KPN has signed an agreement with HTCC ((Hungarian Telephone and Cable Corporation) on the purchase of its Hungarian telecommunication division. KPN’s telecom activities in Hungary are managed by PanTel, owned 75.2 percent by the Dutch company. No details on the purchase price were revealed. The transaction is set to be finalised only at the end of the year, since it needs approval from many organisations. PanTel was founded back in 1998 and has registered capital of HUF 30 billion at present. Other stakeholders in it are PTInvest International with links to KFKI at 4.5 percent and Hungarian Railways MÁV with 10.1 percent. Some sources say that HTCC would like to have PanTel’s other shares, too. PanTel is an important player of the data communication market and plans EBITDA of HUF 4 billion this year with sales revenues at HUF 25.9 billion, half of it coming from abroad. (NG, p 1 and 4)

INFORMATION TECHNOLOGY - 03.05.2004 Fujitsu Siemens bringing a service centre to Hungary
Fujitsu Siemens is to set up its regional service support centre in Budapest. Director of Technology and Strategy Joseph Reger said that that centre will be aiming at introducing the company’s solutions to the Hungarian market. Fujitsu Siemens Computers Kft. increased its sales revenue 25 percent last year to EUR 26.9 million. (VG, p 13)

INFORMATION TECHNOLOGY - 07.05.2004 Online advertising market expanded
The market of online advertisements expanded by 50 percent in Hungary last year, the aggregated income of the four market leading companies added up to 336 million forints in the first three months of the year. (MH, p11)

FOOD INDUSTRY - 03.05.2004 Kométa regains its export licence
Meat company Kométa 99 regained its export licence from the Hungarian authorities on May 1. However, the license does not apply to the United States. The statement has been received by the management of the Italian-owned meat processing company on Friday. (MH, p 17)

Mineral water is popular
Last year the Hungarian mineral water market of 570 million litres achieved a turnover of HUF 32 billion. 68 percent of respondents asked by GfK likes bottled waters; annual consumption is 57 litres per capita. Nearly half of the turnover is achieved by Fõvárosi Ásványvíz és Üdítõipari Rt. (Metropolitan Mineral Water and Soda Co.) that belongs to Nestle, Kékkúti and Apenta being in the ownership of FrankenBrunnen and the rate of import waters is 5-6 percent. The best known brand is still Kristályvíz. (VG p14)

Rush for sugar started from a misunderstanding
Hungary has been hit by a way of buying up sugar just before the country’s accession to the European Union with some CBA outlets in the countryside running out of stocks and Tesco seeing 20 percent larger amount sold than on average. The buying spree has been brought about by the fact that it could be heard in Hungarian media that the price of sugar will go up by 20-30 percent on the back of guaranteed Union purchase prices. However, this information is not true, since purchase price on sugar will take effect only in summer and is expected to lead to price changes only next year. Experts calculate that the sugar’s price may go up by 5-6 percent this year. (NG, p 4)

FOOD INDUSTRY - 04.05.2004 Kométa looking for its previous partners
Kaposvár-based meat company Kométa 99 Kft. has been exporting at full capacity since Monday, Deputy General Manager Tibor Hollósy announced. He added that the company had lost at least HUF 300 million as a result of the export stop, in effect form January. Kométa is looking for its old partners to check to which of them it can distribute its products again. Hollósy hopes that majority of previous partners would return to the company, although he did not rule out that there would be ones that would look for other suppliers. Kométa is exporting more than 40 percent of its products and aims to enter new markets all around Europe. The meat company has posted a HUF 18 million sales revenue last year. Kométa has decided to close its plant that produces only for the Hungarian market and is planning to concentrate its production in its export plant. This measure will not lead to any staff reductions. (NG, p 5)

FOOD INDUSTRY - 05.05.2004 Alpenmilch enters Hungarian market
Alpenmilch intends to enter into the Hungarian market. The fifth biggest creamery of Austria would deliver primarily Yoghurt for the major food store chains. The Hungarian distributor of the Austrian company located in Salzburg wants to deliver its partner’s products to the supermarkets and hypermarkets Spar, Tesco, Cora, Auchan and Tempo. There is still no decision made on prices. Austrian market leader Berglandmilch beside McDonald's intends to deliver products to additional Central-European fast-food restaurants as well. (VG p16)

Parmalat Hungária to take out a HUF 700 million loan
General Manager of TM-Line Kft., the liquidator of Parmalat Hungária Kft. has signed a contract with a credit institution on taking out a HUF 700 million loan. Some questions remain to be settled, but what seems to be sure is that the Hungarian subsidiary of the Italian dairy giant can make use of the first part of the loan today or tomorrow - Somogyi added. HUF 500 million of the loan would be earmarked to finance current assets with the remaining part used to cover settling costs. At the same time, General Manager of Parmalat Hungária László Fónay is having talks in Italy with Enrico Bondi, bankruptcy commissioner of parent company Parmalat S.p.A on the usage of the Parmalat name. Parmalat Hungária Rt. is paying a very low fee for that, since - as Fónay put it - it was the Hungarian subsidiary that paid all costs in connection with the brand name’s introduction to Hungary. Should there be no agreement with the Italian party, Parmalat Hungária will try to take the case to court. Besides this, the management is in talks to keep the existing contract with executives of Italian Catone that renders logistics and haulage services to the company. In a similar development, the 129 workers whose jobs are axed will get a written notification on the termination of their work effective 5 June. (NG, p 4)

FOOD INDUSTRY - 06.05.2004 American market leader bidding for Pick
Smithfield Foods Inc., boasting a 40 percent market share on the American hog market, is having talks on buying Hungarian meat processor Pick Szeged with its majority owner Arago Holding ‘ daily Népszabadság has learnt. The Virginia giant has interests in France and Poland and has repeatedly been interested in investment opportunities in Hungary. Besides Pick, it was considering buying another meat processor Délhús, too. The daily adds that Smithfield is now screening Pick with an auditor, however, this information has not been confirmed from Pick’s side. Arago Holding announced back last April that it was looking for strategic investors to keep or even increase its market share after Hungary’s accession to the European Union and build up an effective distributor network in Western Europe. Information has it that it had been in talks with many investors and this time the deal seems to be in sight. The American company could be not only a co-investor, but would be ready to buy Pick totally. (Nszab, p 15)

FOOD INDUSTRY - 07.05.2004 Fruit processing plant under construction in Nyírtass
Saudi-Arabian SANAMA company group build a fruit processing plant with microwave vacuum-drier technology in Nyírtass. (MH, p11)

Nissin moves production to Hungary
Due to lower production costs Japanese Nissin Foods moves its production from the Netherlands to Hungary. The food-industrial company group achieved a sales revenue of 2.6 billion dollars and realised a profit of 120 million dollars last year. The company still did not disclose in which Hungarian location they will establish their basis. (VG p11)


Slaughterhouses for sale!
The last months have seen an increased interest from foreigners for Hungarian slaughterhouses with investors turning up at meat processing companies Pick, Délhús and Pápai Hús alike. The sector is going to be more predictable on the back of Hungary’s European Union accession and has attracted interest from Danish, Spanish and overseas companies. Favourable conditions of the sector include good geographical location, good quality and enough quantity of animal feed and raw material for processing and relatively cheap meat processing plants. When it comes to Pick, the reaction to the information of yesterday that leading American meat company Smithfield would buy its Hungarian peer was that they were in talks not about an eventual sale, but rather on the inclusion of strategic partners. As for the name of the partner, they revealed no details. Information has it that the Szeged-based company could be bought by a producers’ consortium half years back, however, financial investor Arago, owning 90 percent of the shares, asked HUF 22 billion in return for its stake and talks were terminated. (Nszab, p 13)

AGRICULTURE - 04.05.2004 Agrarian companies up for grabs
State Privatisation and Holding Company ÁPV Rt. expects to complete the sale of ten agricultural companies in a public tender of one round. The companies give job to 5,000 people and their equity capital reached HUF 33 billion with net sales revenue at HUF 44 billion. Of the ten companies earmarked for privatisation, only two - Tokaj Kereskedõház and Szerencsi Mezõgazdasági Rt. - made a profit last year. Bids for the ten companies have to be submitted by June 14 with the evaluation process set to be finished by June 22. Contracts can be made early August and the income from the sale of the companies, projected to reach at least HUF 15-20 billion, is to get to State Privatisation and Holding Company by August 22. Anyone can take part in the bidding process, even foreign investors, however, employees, farmers, integrated partners, contractors and domestic professional investors will be given preference. As for the evaluation process, out of the 100 points, price amounts to 45, the inclusion of supporting partners 35 with capital increase, prescribed on an obligatory base from HUF 50 million to HUF 1.1 billion, totalling HUF 4.6 billion, worth 20 points. Largest agribusiness company Bábolna will be left out of this round and its privatisation can take place in the fourth quarter at the earliest, since the company’s stock of loans has gone up significantly and has lost its equity capital, thus its capital position need to be settled. (Nszab, p 17)

AGRICULTURE - 06.05.2004 Hog problem on the Austrian-Hungarian border
Austrian animal hygiene authorities banned imports of hogs on the hoof from Hungary, saying that the Hungarian stock was not completely free from Aujesky disease. László Zádory, secretary of the Council for Slaughter Animals and Meats (Vágóállat- és Hús Terméktanács, VHT) said the step violated European Union regulations, that is, internal trade agreements, adding that talks were in progress to clarify the situation and he expressed his hope for a positive outcome soon. More than 90 percent of Hungary's hogs are Aujesky Disease-free as a result of 6-7 year long program, he went on to say. In a year, all hogs form Hungary can be free of the disease, he highlighted. Up to now, no hogs were exported from Hungary to Austria, this consignment could be one of the first. (MH, p 12)

TRADE, FAIRS - 03.05.2004 Metro fattens on Central Europe
Metro AG increased its earnings before interest, taxes, depreciation and amortisation (EBITDA) by 27 percent to 426 million euros in the first quarter. The result that is better than expected by the market by 26 million euros can mainly be owed to the performance of Central European units: from revenues of 12.9 billion euros Polish, Czech, Slovakian and Hungarian units provided 5 billion, though the company that has 2370 units worldwide operates altogether 126 stores in the mentioned countries. Last year the company‘s subsidiary, Metro Holding Hungary Kft. could account gross profits of HUF 13 billion with a turnover of HUF 263 billion. The latter lagged behind the base by 7 billion, but the former increased by HUF 1 billion compared to that of the previous year owing to cost management that became more efficient. (NG p6)


TRADE, FAIRS - 04.05.2004 Marking the European Union accession with milk
Hipermarkets are still experiencing, albeit to a smaller extent, the rush for sugar. At the same time, milk prices have started going down with Slovakian milk on offer for HUF 99 yesterday. However, market experts are of the opinion that the balance will be reinstated within weeks. As Attila Rafai, General Manager of Meggle, transporting milk from Slovakia, said there should be no fear of the dumping of cheap Slovakian milk, since the company is distributing only very small portion of the Hungarian quantity. (MH, p 2)

TRADE, FAIRS, CAR - 04.05.2004 BMW Magyarország launched
BMW Magyarország Kft. (BMW Hungary Ltd.) started its operation, the company took over the import and service activities of the brand from Wallis Motor. Under the name BMW Financial Services the distribution offers also financial services to its customers. Wallis preserved the right of motorcycle importation and the service activity of motor bikes will be carried out by the ex car importer too. The centre of the new company operates in Budapest Airport Business Park located in Vecsés, the managing director Tilo von Harling will take up his duties by June 1st. The company will broaden its supply in Hungary by offering the series BMW 1 and Mini Cabrio vehicles. German BMW AG plans to implement an educational centre in Hungary. (VG p11)

TRADE, FAIRS - 06.05.2004 Benetton stays in the inner-city
Spanish company named Zara moves to the business premise of Benetton, which is located in the Masped-house in Váci street. Benetton will stay in the inner-city however the exact location of the new store is not known yet. Based on certain information it is probable that the fashion company will open up their new store in the sometimes ORI (National Office for Event Organisation) headquarter building in Vörösmarty square. The real estate is under reconstruction and managed by the real estate developer company of ING-group. On the other hand the company Zara that is in the first phase of its expansion in Hungary will open up a store in Árkád shopping centre as well. (NG p1, p4)

Outlets to open up in autumn
GL Outlet with its ground space of six thousand square metres located in Törökbálint will open up expectedly in this autumn. Budapest Outlet, the floor space of which is designed to be 13 thousand square metres in the first phase, located in Biatorbágy will also be handed over this fall. There will be 50 stores established in GL Outlet and 45 in Budapest Outlet, however the project in Biatorbágy will be expanded later on. More of the representatives of Hungarian fashion industry think that the sales concept implemented in the United States will not be successful in Hungary in short term.(Outlets in the USA offer products of premium brands at a discount price, which is 30 percent cheaper than butiques’ prices in the inner city). On the contrary, according to Ákos Kozák director of GfK Hungária (market research co.) this kind of shopping centres (selling primarily out-of-season clothes) do have a raison d'être in Hungary. Based on data of the market research company Hungary’s consumptive power could be enough to make outlets with an aggregated floor space of even 50 thousand square metres profitable. Others say this kind of malls could be more attractive if they would sell premium category brand products, whereas these brands cannot be purchased in Budapest at the time being. Miklós Schiffer president of Magyar Divatszövetség (Hungarian Fashion Association) says: considering the famous fashion companies Gucci, Louis Vuitton Moët Hennessy, Dunhill, Hermés, Prada or Dolce & Gabbana are not present in the Hungarian capital. According to press information these companies will not open stores in the outlet centres will be handed over this autumn, however as Gergely Bodó director of GL Outlet said, premium products will appear in their shopping centre as well in some months after the grand opening. (NG p1, p4)


TRAFFIC, TRANSPORT - 04.05.2004 Freight transportation with restrictions
Member states of the European union will ban for at least three years that between two points of a given country a foreign freight forwarder should transport goods (cabotage). The three-year long period can be extended by a further two, thus we can not expect the flood of Union hauliers entering the Hungarian market. In international comparison, however, the competition is to be harsh, since here foreign companies with a competitive offer can carry out transportation activities. According to Károly Csiszár, Transportation Manager of largest Hungarian and regional enterprise in this area Waberer's Group, however, serious business partners take into account not only prices, but also trustworthiness. Waberer's had a total of 170,000 transports last year with 1,400 own and 600 contractors- vehicles, 70 percent of them carried out between Hungary and a member state of the European Union with 20 percent realised in the Union and 10 out of it. Csiszár is of the opinion that the group can have a ratio of forwarding activity within the Union, but not going through Hungary, at 30-35 percent in one a half years. In parallel with the European Union accession, restrictions on the number of international freight forwarding licences is a thing of the past and the commission licence can be given to any haulier should its vehicles be in line with technical specifications and meet professional and financial requirements. According to data from Nit- Hungary (International Freight Carrier Association), in Hungary a total of 27,000 enterprises are dealing with freight forwarding, having a total of more than 97,000 vehicles. (MH, p 11)

TRAFFIC, TRANSPORT - 05.05.2004 Additional flights from Sky Europe
Sky Europe airlines The low service airlines launched its new flights from Warsaw, Vienna-Bratislava and Budapest on Monday. The low service airways that was founded by investments of the European Bank for Reconstruction and Development EBRD, ABN Amro and other entities in 2002 starts airplanes to 18 destinies in 12 countries. SkyEurope’s fleet contains 13 aircrafts, the company plans to achieve a number of air passengers of 1million in 2004. (NG p5)

TOURISM, HOSPITALITY - 06.05.2004 Low fare flight to Lake Balaton?
The owerns of the airport at Sármellék entered into a contract with an Irish consortium consisting of professional and financial investors about the operation of the airbase. The facility will continue to be in the ownership of the municipalities of Zalavár and Sármellék and Danubius Rt., and they will start investments of HUF one billion from Irish capital there this year. Within the frame of the investment to be started these days, among others, a new passenger terminal will also be established. The agreement between the concerned parties was strongly facilitated by the fact that the state supports the establishment of the airport’s infrastructure with HUF 300 million this year. According to estimations, the Irish investor that will operate the airport as of November under the now signed agreement, intends to increase the number of passengers at the airbase – which is operated from HUF 200 million annually – from the current 30 thousand to 100 thousand. In order to achieve this, the Irish consortium has already started negotiations with several airlines about the launch of scheduled and charter flights, but it is not known yet, whether the low fare airline Ryanair is among them. (NG p1, 4)

INVESTMENT, DEVELOPMENT - 04.05.2004 Four in the running for M6 concession
Four consortia of a total of 20 Hungarian and foreign companies have tabled bids for the construction of a 57-kilometre stretch of motorway M6 between Érdi tetõ and Dunaújváros. The investment costs HUF 80- 90 million to complete and will be carried out in a Public Private Partnership scheme. The tender also contains the concession operation for 22 years. Besides Hungarian investors, French, Portugal, Austrian, German and Israeli ones are also interested in the project. (All 4 consortia are introduced in details in daily Népszabadság). Bids will be evaluated within 90 days and after a maximum 30-day long preevaluation period, no more than 3 bidders will be selected. Plans call for the winners start construction work in the third quarter of 2004 and the motorway stretch should be at least temporarily operational no later than March 31, 2006. The Hungarian state helps through areas of land on the route of the road and licences necessary for the work to start. Minister of Economy and Transportation István Csillag has said earlier that should this investment turn out to be successful, the next stretch will also be built on the PPP scheme. (NG, p 4)

INVESTMENT, DEVELOPMENT, REAL ESTATE - 04.05.2004 Irish invasion in the housing market
According to a brand new study 178 Irish citizens bought real estates in Hungary in the first quarter of the year. This is an outstanding increase in annual comparison: 4 Irish people bought homes in last year’s same period, while 107 citizens from Ireland purchased real estates in Budapest the whole last year. Beside Irish people also Germans, Brits and Romanians bought more homes than a year before. The number of real estates purchased by USA citizens and people from Israel show stagnation. Foreigners preferred the capitals side „Pest”. 117 of the Irish buyers bought homes in the 9th district, however there was a significant interest in real estates located in the districts 5, 6, 7 and 8 as well. The capitals side „Buda” was not that interesting for people from abroad, only 14 percent of the sold real estates can be found in this part of the city. (NG p1, p4)

Úttörõ Áruház sold
German Tera Consult GmbH bought Úttörõ Áruház (Pioneer’s Department Store) from the two former owners Agroinvest Rt.and Pretium Property Kft. The ground space of the department store adds up to 2500 square metres. The purchase money was nod disclosed, the former owners expected to get 5 million euros in exchange for the real estate’s proprietary rights. The new owner will tear down the building located in Kossuth Lajos street, and will build offices, commercial units and a hotel in its place. According to certain estimations the cost of investment will add up to 2 million euros. Tera Consult already entered into a pre-contract with an international hotel company aiming the implementation of the hotel. The letting of office spaces will be carried out by Colliers International. (VG p9)

INVESTMENT, DEVELOPMENT - 06.05.2004 Savoya Park to be handed over in the autumn
The first phase of Savoya Park located in the 9th district of Budapest will be finished by September. The two main tenants of the shopping centre, the ground floor of which adds up to 35 thousand square metres are OBI and Auchan. The investor GRC Hungária Kft. spends 18 billion forints on the project, thereof construction cost of the office building of 9500 square metres will be 3.5 billion forints, while developing the environment’s infrastructure requires a similar amount as well. The offices will be finished by autumn of 2005. The letting of spaces will be carried out by Bradmore King Sturge Kft.and NAI Otto Hungary. The municipality of the district intends to build a driving range and a sports centre including an ice-hall in the neighbourhood of the shopping centre. Aiming the implementation of the driving range, the municipality will commence a competition in the near future. As a result of this construction works can take place this year already, however the building process of the sports centre can be started next year at the earliest . (VG p6, NG p5)

INVESTMENT, DEVELOPMENT, REAL ESTATE - 06.05.2004 Prague is leading
Prague, Budapest and Warsaw are the most favourable investment fields in among new EU member states for real estate developers – stated the Cushman & Wakefield Healey & Baker consulting firm. Last year the Hungarian capital was at the top of the list. In the commercial real estate market experts handle the three leading states together; in retail similar development pace is expected in new member states. In logistics and the market of industrial real estates Southern Poland, Western Slovakia and the middle areas of the Czech Republic attract investors the most, since German and Scandinavian traders intend to reach South and Eastern European markets through the Polish road network. (VG p23)

INVESTMENT, DEVELOPMENT - 07.05.2004 Another motorway construction agreement to be signed today
Representatives of National Motorway Rt. (Nemzeti Autópálya Rt.) and Völgyhíd Konzorcium, made up of Strabag Építõ Rt. and Hídépítõ Rt. will sign the contract on the construction of motorway M7’s stretch between Zamárdi and Balatonszárszó today. The investment is expected to be finalised till November 2006 and costs HUF 74 billion with HUF 39 billion of it earmarked for a 2 kilometre long viaduct itself. (VG, p 5)


TriGránit also in the running for M6
The Ministry of Economy and Transportation is expected to make decision till 17 May on which of the four bidders for the stretch of motorway M6 between Érdi tetõ and Dunújváros should not make it to the second round. Experts of the ministry will have work to do, since all applicants have good references and well-founded bids. Under the concession law, the final winner should be named not later than within 90 days after the deadline of applications in the first round. Those three consortia that make it to the second round will have 6 weeks to come up with a detailed bid. Interested in the construction work are Dunamenti Autópálya Konzorcium, Pannon Konzorcium, M6 Duna Autópálya Konzorcium and Euroinvest/TriGránit/Strabag/OTP/ASF/Egis Pályázati Konzorcium. (VG, p 5)

TAX, SOCIAL INSURANCE - 07.05.2004 Union not approving simplified business tax
Brussels is not approving simplified business tax (eva) in its current form and has called on the Hungarian Government to modify it. The European Commission is afraid that ‘eva’ would lead to lower VAT tax income flowing into the budget and lower amount can be shared than if this type of tax was not existing. The Hungarian government has until 21 May to notify the Commission of the modification it plans to carry out. The Finance Ministry is of the opinion that ‘eva’ regulations are in line with European Union VAT guidelines and the Ministry had not received any negative feedback on the matter. The Finance Ministry does not approve the Union’s concerns, since the new type of tax had resulted in larger tax income, it argues. (NG, p 1 and 3, Nszab, p 1 and 13)