OECD Secretary General Angel Gurría opened the 3rd Global Forum on Productivity organized by the Organization for Economic Cooperation and Development in Budapest with a keynote speech on the importance of enhancing SME productivity within global value chains. In the introductory remarks delivered at the opening of a high-level policy panel on the first day of the event, Minister for National Economy Mihály Varga analysed productivity challenges which the Hungarian economy is facing and pro-competitiveness measures the country has implemented or plans to introduce.

As Mr Gurría pointed out, in the post-crisis period, the years after the global downturn of 2008, economic recovery has been the slowest of past decades, and it has been coupled with sluggish investment and global trade growth. In the OECD member countries, the pace of productivity growth has been decelerating since the 2000s, and this may in the long term lead to the substantial loss of market share on global markets by member countries. The OECD established the Global Productivity Forum in 2015 precisely with the aim of revealing medium- and long-term productivity determinants, which in other words influence competitiveness, the very source of sustainable economic growth.

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The entire global economy, including advanced economies, is in a “low-growth trap”, Mihály Varga said, quoting a conclusion made in the OECD study which was published at the end of last year. The Minister said countries could only break out of this situation if governments manage to pursue a pro-growth economic policy even if their fiscal manouvering room is limited. They can provide additional growth momentum by boosting investment, which can be expected to turn profitable within a short period of time, the creation of jobs and tax reductions.

In Hungary, these economic policy measures were implemented already years ago, therefore these proposals may sound familiar to us, the Minister stressed.

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The crisis has highlighted certain structural fault lines in our economy, such as an oversized export sector and the often isolated operation of large enterprises, he added. Accordingly, it is an important objective to help corporate competitiveness accelerate the growth rate of the entire economy and the rapid integration of SMEs into global value chains. Besides helping to narrow the technological gap, the main priorities of the Government of Hungary include the creation of a supportive business environment, making vocational education more market-compatible and conducting an efficient dialogue with enterprises, he said.

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Among the conference participants was, among others, OECD Chief Economist Catherine Mann, Slovakia’s Finance Minister Peter Kazimír, Portugal’s Economy Minister Manuel Caldeira Cabral, Sweden’s Minister of State for Financial Affairs Karolina Ekholm, researchers of the field as well as leaders of financial institutions and economic think-tanks. On the sidelines of the forum, Minister Varga and the OECD Secretary-General signed an agreement, according to which the OECD elaborates a comprehensive strategy designed to improve the competitiveness and productivity of Hungarian SMEs.

(Ministry for National Economy)