Chinese and Indian FDI in Hungary and the role of Eastern Opening policy

Katalin Völgyi () and Eszter Lukács
Additional contact information
Katalin Völgyi: ELKH Centre for Economic and Regional Studies, Institute of World Economics
Eszter Lukács: Széchenyi István University

Asia Europe Journal, 2021, vol. 19, issue 2, No 2, 167-187

Abstract: Abstract The aim of this paper is to assess the main features of Chinese and Indian investments in Hungary and the role of the Hungarian Government’s Eastern Opening policy in the attraction of investments from these two Asian giants. This paper covers the sectoral distribution, modes of market entry, and motivations of Chinese and Indian foreign direct investments. The automotive sector is the most attractive sector for investors from both countries. ICT manufacturing (electronics) and services, and the renewable energy sector are also very attractive for Chinese companies. The same is true for IT/BPO services and the chemical sector in the case of Indian companies. Chinese and Indian companies enter the Hungarian economy mainly through green-field investments or acquisitions. Market-seeking and strategic asset-seeking motives are dominant in the case of investors from both countries. This paper also puts a special emphasis on studying the impacts of Hungary’s Eastern Opening policy (launched in 2012) on Chinese and Indian investments. The findings show that the Eastern Opening policy has had a significant impact on the investment decision (location choice) of new Chinese and Indian investors and further expansion of investments by Chinese and Indian companies located in Hungary due to four factors, namely high-ranking political meetings, strategic cooperation agreements, cash grants from the Hungarian Government and supportive services of HIPA.

Keywords: China; India; Foreign direct investments; Hungary; Eastern opening policy (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s10308-020-00592-1 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:asiaeu:v:19:y:2021:i:2:d:10.1007_s10308-020-00592-1

Ordering information: This journal article can be ordered from
http://www.springer. ... es/journal/10308/PS2

DOI: 10.1007/s10308-020-00592-1

Access Statistics for this article

Asia Europe Journal is currently edited by Ulrich Volz and Lay Hwee Yeo

More articles in Asia Europe Journal from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().