multi-month upward trend of the volume of Hungary’s foreign trade continued in 2014: in the first month of the year, exports and imports increased by 6.1 percent and 3.6 percent, respectively, while foreign trade surplus is up by EUR 209 million, to EUR 482 million, in comparison to January 2013. Industrial output growth and the significant increase of industrial export orders have already augured positive data. In January, the growth of exports exceeded that of imports, while foreign trade volume as a whole was rising dynamically. In January 2014, the value of exports and imports was EUR 6.6bn and EUR 6.1bn, respectively. In the first month of the year, the volume of imports and exports of machinery and transport equipment gained 7.6 percent and 5.6 percent, respectively. The main driving force behind the increase in both directions continued to be the sales of road vehicles: while exports of road vehicles were up by more than 50 percent, imports were some one-third higher year-on-year. The key category lifting imports was that of components, while the division of motor vehicles was the most positive factor for exports. The exports and imports of manufactured products were also higher by 5.6 percent and 10 percent, respectively. The trade volume of food, beverages and tobacco products also registered growth with exports and imports up by 15 percent and 7.9 percent, respectively, compared to January 2013. In January 2014, Hungarian exports to and imports from the EU member states constituted 80 percent and 74 percent of total, respectively. In comparison to January 2013, Hungarian exports and imports vis-á-vis these countries were up by 7.2 percent and 14 percent, respectively. Exports to non-EU countries increased by 2 percent and thus the foreign trade deficit with these countries shrank by EUR 445 million. In light of rebounding external demand and the dynamic growth of the motor vehicle sector the Ministry for National Economy is expecting foreign trade turnover to continue to improve. (Ministry for National Economy)

The European Union has decided that the distilling of pálinka shall be subject to taxation even under the quantity of 50 litres per year. Following the decision, the Government will initiate consultations with the European Commission with the aim of ensuring that the tradition of distilling pálinka lives on in Hungary in accordance with the EU regulatory framework.

Brussels launched an infringement procedure against Hungary in 2011, as the Orbán Government – mainly to preserve a national tradition -- had abolished the subcontract distillation spirits tax for home-made pálinka in 2010.

Distilling pálinka has been part of Hungarian cultural heritage which is rooted in historic traditions, therefore Hungary – like other EU member states such as Austria, Germany, Slovenia or Portugal – is insisting on defending and upholding its own  tradition.

Since 2010, local farmers have the right to decide how to process fruits grown in their garden. In the countryside pálinka is distilled in order to make use of fruits that could not be consumed or cooked fresh.

The Government is committed to upholding the living tradition of home-made pálinka.

(Ministry for National Economy)