Foreign direct investment and corporate restructuring in Hungary

Large-scale foreign direct investment and intensive business activities by multinational companies have played a crucial role in Hungary's transition to a market economy. The massive inflow of foreign capital has supported the macro-economy by spurring effective demand, contributing substantially to its long-lasting and stable economic growth, as well as to drastic changes in the corporate sector through the conversion of ownership structure, improvements in production system, strengthening market competitiveness, modernization of management systems, and revitalization of R&D and innovation activities. In spite of all this, Hungary still has many problems with corporate restructuring. The Hungarian government and the business sector are now at a turning point in their passive strategy of economic transformation.