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China's Investment Spurs Economic Growth, Technological Advancement in Hungary | Insights

By RAN ZHENG|May 11,2024

Chongqing - President Xi Jinping concluded his state visit to Hungary from May 8 to 10. During the visit, both nations agreed to upgrade their existing comprehensive strategic partnership to an all-weather comprehensive strategic partnership for the new era.

"Hungary enjoys a strong relationship with China, spanning both governmental and business sectors," said Dr. Luczywo Marian, Director of VT Logistic Kft, in an exclusive interview with Bridging News on May 9. "We are scheduled to meet with the Mayor of Chongqing and representatives from Yuxinou, which will facilitate direct communication and streamline negotiations on various projects."

Bridging News Reporter Zheng Ran (left) interviewed Dr. Luczywo Marian (right), Director of VT Logistic Kft, on May 9. (Photo/Zheng Ran)

GMT resembles Chongqing's strategic positioning on the Yangtze River

VT Logistic, owning a significant stake in Gönyű Multimodal Terminal (GMT), is at the forefront of creating a multimodal transport powerhouse in Hungary.

The construction progress of infrastructure at Gönyű Multimodal Terminal. (Photo/Luczywo Marian)

The GMT, part of the China-Singapore (Chongqing) Demonstration Initiative on Strategic Connectivity (CCI), is Chongqing's inaugural overseas third-party market heavy asset. It is a collaborative effort involving parties across China, Singapore, and Hungary to lower costs for trains like the China Railway Express.

Dr. Marian emphasized GMT's strategic position near the Slovakian border on the Danube River, close to several European countries, including Austria, Czech Republic, Italy, Slovenia, Serbia, Poland, and Romania. By providing faster container turnover, GMT aims to reduce congestion experienced at European terminals like Duisburg and Hamburg.

"This central European hub, akin to the well-positioned Chongqing terminal on the Yangtze River, benefits significantly from existing rail infrastructure," he added. With infrastructure enhancements, GMT is poised to become a top-tier multimodal hub, integrating rail, road, river, and sea transport.

Dr. Marian noted the geopolitical tensions affecting maritime logistics, stating, "Conflicts have forced many vessels to reroute around Africa, extending shipments from China to Greece to about 70 days." He highlighted a shift to rail transport, taking approximately 14 days from China to Poland.

China boosts investment in Hungary's new energy sector

In 2023, China solidified its status as Hungary's top foreign investor and primary trading partner beyond the EU, with recent advancements extending beyond logistics.

China is boosting its investment in Hungary's new energy sector. CATL, a major Chinese electric vehicle (EV) battery manufacturer, is building a plant in Debrecen. Upon completion, the investment will total 10.7 billion euros.

Dr. Marian highlighted strategic developments in Hungary, citing the GMT's proximity to major automotive manufacturers like Audi and BYD, located within 10 kilometers from the terminal. He also noted the Samsung SDI factory and CATL's new EV battery plant, approximately 20 kilometers from Budapest.

Dr. Marian added that these developments position Hungary as an ideal logistic hub, connected by an extensive highway network, facilitating goods distribution and industrial growth. This strategic advantage attracts more international investments, fostering economic growth with new technologies and job opportunities.

The night view of Budapest, the capital of Hungary. (Photo/Luczywo Marian)

Furthermore, he mentioned regional transportation projects like the Belgrade-Budapest high-speed railway, which enhances Hungary's role as a central European logistics hub.

This railway, a key project in the collaboration between China and Central and Eastern European countries under the Belt and Road Initiative, significantly enhances connectivity from Serbia to Hungary.

Dr. Marian emphasized that these developments drive economic growth, create jobs, and advance technology within Hungary and beyond.

This year marks the 75th anniversary of the diplomatic relations between China and Hungary. (Photo/Luczywo Marian)

"Once the GMT is operational, we aim to serve major corporations in the vicinity, such as Korean giants like Samsung and SK, which are heavily involved in battery manufacturing, and several Chinese automotive companies," he added.


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