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WEEKLY NEWSLETTER
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Hungary
Index
The government maintained a state monopoly on foreign
trade
until 1988, when it began allowing all but a few
production
enterprises to participate in foreign trade. In 1989 the
country's once-powerful foreign-trade enterprises still
existed,
but they held exclusive trading rights on only a narrow
range of
goods. The Ministry of Trade's chief control instrument on
foreign trade was the licensing of imports and exports,
which the
ministry could use to avoid balance of trade and balance
of
payments disequilibria. For example, the ministry could
deny an
enterprise a license to export a product to the Comecon
market in
order to encourage its export to the convertible-currency
market.
The ministry issued import licenses according to a list of
priority items. Highest-priority goods were those
necessary to
maintain current production, including raw materials,
semimanufactured goods, and spare parts. Second priority
went to
capital goods and machinery that could quickly boost
hard-currency exports. Basic consumer goods and
nonessential and
luxury items constituted the two lowest categories. The
government enacted austerity measures in 1988 that limited
imports almost exclusively to the most essential items.
Data as of September 1989
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