Wuxi Becomes the Country’s Strategic Entry Point into Chinese Market

The first Chinese-Hungarian industrial park in Wuxi

While large corporations from the West have been present in China for decades, Hungarian innovation leaders are now following suit. An industrial park has been opened in the greater Shanghai area to serve as an incubator for Hungarian high-tech companies. Expectations are high. The government anticipates a noticeable boost to Hungary’s gross domestic product.

Hungarian companies now have a new strategic base in the seven-million-strong metropolis of Wuxi, located in the economically dynamic agglomeration of Shanghai. As Government Commissioner László György confirmed to Világgazdaság, the new Chinese-Hungarian industrial park serves to consolidate the market presence of Hungarian innovations in Asia.

The first tenant is Magnus Aircraft, based at Pécs-Pogány Airport, which will produce its own lightweight aircraft in Wuxi.

What is special about this deal is that all intellectual property rights remain with the Hungarian parent company. The aircraft will be manufactured locally for the Asian market under their own brand name.

The aircraft manufacturer is closely followed by BioLab, a specialist in microbiological culture media. The company is already active in Southeast Asia and sees enormous leverage in the new location. Based on current sales of 4.5 billion forints (11.7 million euros), the government commissioner forecasts a tenfold increase in revenues for the company within the next five years.

The strategy behind the industrial park is competitiveness through local presence. Anyone who wants to be successful in China must produce locally. Three other companies have already signed letters of intent, and seven more are in negotiations. György estimates that the profits of these companies could account for up to 0.5% of Hungary’s GDP in four to five years.

The location in China is not only considered a gateway to the Chinese market, but also the “key to the whole of Southeast Asia,”

explained the government commissioner.

Commissioner György sees the opening as proof that Hungary’s foreign trade strategy is the right one. While the United States and Western Europe have lost their lead in many areas of technology—according to studies, China now leads in 57 of 64 key technological fields—Hungary is positioning itself as a bridgehead.

It is no longer just Volkswagen, Mercedes, or BMW that are establishing themselves in China. Hungarian companies are finally gaining a foothold in this gigantic market,”

emphasized the politician.

The economic expansion is the result of intensive diplomatic groundwork. Twenty agreements between Budapest and Beijing were recently signed as part of the Belt and Road Initiative. Major projects such as the Budapest-Belgrade railway line form the infrastructural backbone of this cooperation.

For the Hungarian economy, a phase is now beginning in which international agreements must be translated into “tangible results.” The industrial park in Wuxi is just the beginning of a far-reaching commitment by Hungarian innovators in the Far East.

Via Világgazdaság, Featured image: Wuxi, China/Facebook

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