The Government has concluded a strategic partnership agreement with American software developer EPAM Systems Limited; the company will be increasing its current capacities and the number of people it employs in Debrecen and Szeged with an investment of 3.6 billion forints (EUR 11.5M)”, Minister of Foreign Affairs and Trade Péter Szijjártó announced at a press conference.
At the signing of the 69th such strategic partnership agreement, Mr. Szijjártó stressed: “Hungary succeeded in winning EPAM Systems’ latest investment project against regional rivals in stiff international competition, which was contributed to by the fact that the Budapest office of the company Group is also its European headquarters. The Government is contributing to the project with non-refundable funding totalling 1.3 billion forints (EUR 4.15M)”.
“According to the agreement, the company will be constructing a new office building in Szeged and expanding its existing office building in Debrecen, resulting in the creation of 365 new jobs in addition to the company’s existing 1500 employees by 2018”, the Minister told reporters.
Mr. Szijjártó highlighted the fact that the ICT sector contributes most to enabling Hungary’s development to move forward into a new dimension. “The Government’s 2010 target of making Hungary the region’s production centre “has succeeded”; the ratio of industry within the GDP now exceeds 25 percent, which is the third highest proportion within the EU, and from here we must move forward into a new period of economic development based on research & development and innovation, which is represented by high added value”, he pointed out.
Among the government measures introduced to help achieve this goal the Minster mentioned the reduction of VAT on internet access. “With the 8 percent growth achieved during the first four months of this year the performance of the ICT sector exceeded one thousand billion forints (EUR 3.2bn) and the number of people employed within the sector increased by 14 percent to over 200 thousand during the first quarter”, the Foreign Minster highlighted.
According to Mr. Szijjártó, EPAM, which is registered on the New York Stock Exchange and employs 20 thousand people worldwide, was ranked 8 out of the world’s 25 most rapidly developing tech companies by Forbes Magazine in 2016. “EPAM employs trained staff at competitive salaries, which represents a major retention factor for large rural cities. The company also has strategic agreements with several universities and provides for the training of staff through dual training programmes”, he added.
The Hungarian Foreign Minister also pointed out that this was the 11th such strategic partnership agreement concluded with an American company and that there are currently 1656 American enterprises operating in Hungary who employ a total of some 100 thousand people. “The ratio of Hungarian suppliers in the supply chains of the Governments’ strategic partners is 59 percent, which grew by an average of 4 percent following the conclusion of these agreements, which in turn indicates that the capacity expansion projects of international corporations provide new business opportunities for Hungarian SMEs”, he emphasised.
On the subject of the planned free trade agreement between the European Union and the United States, the Transatlantic Trade and Investment Partnership (TTIP), Mr. Szijjártó said: “We are striving to achieve a rational dialogue that is free from political emotions and in which soundness is primary, not speed”.
Managing Director of EPAM Systems Ltd. Bence Vinkó said: “The American owned and based company that develops complex software solutions is one of the world’s most rapidly developing enterprises. The company achieved record turnover of almost 1 billion dollars and 25 percent growth last year”.
“The Company has been present in Hungary for 15 years in Budapest, Debrecen and Szeged, and based on the number of people it employs is the largest software development company both in Hungary and the region. The Hungarian company also manages the Group’s Polish and Bulgarian subsidiaries”, he added.
“With the support of the Hungarian Government the company is creating new jobs and contributing significantly to the growth of the Hungarian economy”, Mr. Vinkó said, adding that “the company’s latest 11 million euro job creation investment project will lead to the hiring of 365 new employees in Debrecen and Szeged”.
The Managing Director also called attention to the fact that there are some 22 thousand unfilled jobs within the sector, which if filled could generate annual GDP growth of 400 billion forints, or 1.4 percent. EPAM is making a huge effort to increase the number of people working in the sector and has launched several training programmes; the company is capable of training anyone to be a software developer within the space of 4 months at its academy, he indicated.
Mayor of Debrecen László Papp (Fidesz-KDNP) spoke about the fact that 50 billion forints (EUR 160M) in new investments have been announced in the city so far this year, which should lead to the creation of 1300 new jobs, which could increase to 2000 by the end of the year including negotiations that are currently ongoing. The ICT sector is also gaining significance in Debrecen and already provides jobs for more than 4600 people, the Mayor said.