Industrial investment related to agriculture is a special focus
13. 07. 2017.
Prime Minister Viktor Orbán gave an address at an inauguration ceremony for a new production plant for Balogh Tészta Zrt. in Tiszakécske on Thursday. He said that the Hungarian government particularly values any enterprise linked to agriculture which converts know-how from this area into industrial know-how and commercial capital. Balogh Tészta Zrt., he said, is one such enterprise.

The Prime Minister said that Hungarians truly understand agriculture: it is in their genes, with knowledge passed on from father to son. They are best equipped to cultivate agriculture to high international standards, the Prime Minister stated.

Mr. Orbán added that the new pasta production plant for Balogh Tészta Zrt. is also important because the company is a family business. The sheer volume of the plant’s output makes it a significant factor in the Hungarian national economy, he said, and this is also of significance for the gross domestic product. He observed that a special characteristic of Hungarians is that they feel most confident when they know that the food they have chosen is the product of the Hungarian soil and the work of other Hungarians. “This feature is a major advantage for the future, and I sincerely hope that as a community and a nation we continue to share customs such as this”, he said. The Prime Minister went on to point out that Balogh Tészta Zrt. probably owes its success to the fact that “it has never been frightened of its own shadow”. It never halted or retreated, he said, but has sought paths for its future, and got to where it is now through continuous development. A great lesson to be learnt from its success, he added, is that an agricultural enterprise can stand on its own two feet in the long run if it not only produces for the Hungarian market, but also ventures onto the international market.

Photo: Károly Árvai

Speaking about the economic environment in Hungary, Mr. Orbán said that there are hardly any unemployed people in the country, and those who want to work can find jobs: unemployment is currently around 4 per cent, and in practice 3.5 per cent qualifies as full employment. Development does not stem from merely creating new jobs, but from creating new jobs which require and involve higher skills and technological know-how, he stated.

The Prime Minister highlighted that recently every European nation has learnt that “the only way to avoid falling is by standing on two legs”: the first one is foreign investment, creating production facilities in Hungary, and the second is businesses and capital in Hungarian ownership. “If we have both legs and they are more or less equally strong, the Hungarian economy cannot be overturned”, he stated. If, however, the country does not pay sufficient attention to Hungarian businesses, Hungarian owners of capital and Hungarian investors, the first slight breeze could overturn the economy – as it did in 2008, in the crisis, he said. No matter how good the Hungarian economic indicators are today, no matter how many successful entrepreneurs one sees, one must never forget the enormous efforts Hungary made to claw itself out of the pit into which the country – which deserved better – was pushed by the communist system, Mr. Orbán highlighted.

Photo: Károly Árvai

At the ceremony, Mayor of Tiszakécske János Tóth (Fidesz) said that Balogh Tészta Zrt. is Hungary’s second largest pasta production plant in terms of production capacity, and provides jobs for 25 people living in Tiszakécske. The company is also one of the chief sponsors of the local handball club, he said, it helps in child welfare and donates to the local family assistance service and retirement home.

Company owner László Balogh stated that currently exports account for 20 per cent of production. They export to Romania, Slovakia, Ukraine, Slovenia, Croatia and Bosnia, and now also have a partner from China. They plan that within three years seventy per cent of their output will be in exports, he added.

Photo: Károly Árvai

Over the course of almost two and a half decades, Balogh Tészta Zrt. – which has been a family business from the start – has become one of the Hungary’s largest pasta manufacturers. The Hungarian-owned business procures its ingredients solely from Hungarian suppliers.

The capacity of the enterprise’s first plant, established in Jászkarajenő in 1993, proved to be insufficient after a few years, and in 2002 the need emerged for construction of a new pasta factory. That plant reached the limit of its capacity in 2013.

Photo: Károly Árvai

The construction of the Tiszakécske plant began in July 2015. The first phase has production lines capable of manufacturing and packaging 2,250 kilograms of pasta per hour, and a floor area of 8,500 square metres. The project cost HUF 2.7 billion, of which HUF 1.6 billion came from bank loans, and HUF 500 million from EU funds.

Last year Balogh Tészta Zrt. manufactured nine thousand tonnes of pasta products, with net sales revenues of HUF 1.316 billion, and of HUF 1.311 billion in 2015. The majority of the sales revenues come from the domestic market: around HUF 1.14 billion in 2016 and HUF 1.105 billion in 2015. The company’s after-tax profit was HUF 161 million in 2015 and HUF 200 million in 2016.