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Hungary, a beautiful country conveniently located in Central Europe, successfully made a transition from a centrally planned to a market economy at the end of the 1980s. Although the economic growth of the country has been often cyclical, the accession to the EU had an overall positive effect on its economic performance.
According to European Information Technology Observatory (EITO) the IT outsourcing market is showing a robust growth: already in 2006 it reached 91 million EUR (over 135 mln USD) and continues growing at an impressive pace. Hungary’s strong ITO value proposition, geo and cultural proximity to the Western Europe which recently outrun the US in terms of ITO activity (source: Forrester) makes it an optimal nearshoring option.
The global shortage of IT professionals has not touched on Hungary yet. The country supplies highly educated and well skilled IT workers who are in growing demand on the market as their level of education and overall background is above the European average. In terms of communication crucial for effective ITO relationship, Hungarians are also among the toppers: many foreign employers find them very flexible, highly motivated and dedicated. Foreign languages proficiency is also remarkable as according to the survey ”Offshore IT Outsourcing and Transition Economies” conducted by Business School of the University of East London over 50% of the workforce can speak either English or German, or both which helps eliminate the language barriers.
As for the infrastructure it is reported fairly adequate with all necessary facilities available for IT companies. Hungary has benefited from significant technical and infrastructure investment: Since the beginning of the transition to democratic market economy Hungary has attracted a steady stream of foreign capital, well-balanced across the various sectors. Hungary, a country of 10 mln inhabitants, can currently boast of having lured Foreign Direct Investment (FDI) of more than 60 billion EUR to date which represents the highest per capita rate in the Central/Eastern European region, reports Hungarian Investment and Trade Development Agency. According to the forecast of the Economist Intelligence Unit Hungary will retain its leading role in FDI stock/capita in the coming years.