The Government signed a strategic partnership agreement with Ganz Holding, making Ganz the third Hungarian-owned company with which the government signed such an agreement.
Péter Szijjártó, parliamentary state secretary to the Ministry for Foreign Affairs and Trade emphasized on Wednesday in the Parliament before signing the agreement that the strategic partnership agreement with Ganz Holding was a sign of appreciation of the achievements of the Hungarian engineering industry. He added that this was the 48th strategic partnership agreement signed by the government.
Zoltán Fitos, chairman-CEO of Ganz Holding said that the agreement with the government would broaden the Ganz Holding group’s market opportunities and increase its role in the economy and education in Hungary, while the government also benefits from the partnership since Ganz would promote the development of the economy.
Péter Szijjártó explained that Hungary’s policy of re-industrialization was introduced in 2010, and its success is easy to measure: Hungary’s share of industry within GDP is the third highest among EU countries and employment has reached record heights, to which the industrial sector had also contributed by creating new jobs. Moreover, the Hungarian economy experienced a growth reversal last year; in the first quarter of 2014, GDP expanded by 3.5 percent while investments increased by 22.6 percent in the first three months of the year.
The state secretary pointed out that these achievements had required considerable transformations, and the government was looking for strategic partners to convert Hungary into the production centre of Europe.
Péter Szijjártó explained that the development of Ganz Holding was accompanied by outstanding, epoch-making engineering achievements, technical innovation and world patents. Engineering is a flagship of the Hungarian economy, and is crucial for the country’s industrial development; it is also a labour intensive sector employing many suppliers. Engineering accounts for over 11 percent of the total processing industry output as the production value realized by the sector amounted to EUR 9 billion in 2013, and it also represents 10 percent of Hungary’s total machinery exports, the state secretary pointed out. In Hungary, 4,000 engineering businesses employed over 93,000 people in May, 1,500 more than at the end of last year.
The state secretary said that in addition to strengthening the economy from the inside, Ganz is also a “flagship” of Hungary’s success abroad, since it has joint ventures with several British, French and Russian companies. Ganz further enhances the reputation of the Hungarian industry through its achievements on several markets targeted by the policy of opening to the East, emphasized Péter Szijjártó.
He reminded that Eximbank also promotes the successful foreign market activities of Hungary’s largest railway vehicle manufacturers, i.e. Ganz, Bombardier and Stadler; he mentioned Hungarian participation in the railway tender of Egypt as an example.
Other important contributions of Ganz to the national economy are that it employs over 500 people, and about 70 percent of its suppliers are also Hungarian-owned.
Zoltán Fitos emphasized that Ganz is among the few Hungarian engineering companies that maintained profitable operations. The company has two events to celebrate during the year: it was founded 170 years ago and Ábrahám Ganz was born 200 years ago, he added. Ganz Machinery Works Holding is one of the largest individual machinery works in Hungary; its products are related to railway and urban transport, power generation, water supply, water management, urbanization and environmental protection.
He explained that the products supplied by the Ganz Holding Group and its predecessors have a major influence on the operation and maintenance – and hopefully development – of infrastructure in Hungary, including for example most of the cooling water systems of the Paks nuclear power plant, several hydropower plants, municipal waterworks, sewage-treatment plant, equipment for district heating, agricultural irrigation and fountains.
Zoltán Fitos said that about 50-80 percent (depending on year and member company) of the Ganz Grop’s production is sold on export markets amidst fierce international competition, where leading western companies are also present as suppliers. He mentioned Caterpillar, Liebherr and Zöllner as examples.
In 2013 the Group managed to increase its consolidated earnings by 46 percent, to HUF 13.1 billion from the previous year, and expects further increase this year, said Zoltán Fitos. Ganz has over 550 own employees and 80-120 leased employees, and over 500 suppliers.
The chairman–CEO also explained that they established a joint venture with Rosatom affiliate Atomenergomash in 2008. Since the product range of Ganz includes power plant reloading machines, spent fuel rod storage, power plant cooler, safety and other, not primer pumps since the end of the 1970s, joint ventures had to be founded to ensure the future of their profile. Ganz Holding is probably the only Hungarian company that has been continuously supplying not only the Paks nuclear power plant but also Ukrainian, Czech, Slovakian and Bulgarian nuclear power plants, among others. "We have the necessary knowledge and certificates for nuclear power plant operations, so we can play an integrator role in the planned 40 percent domestic supply of Paks II", said Zoltán Fitos.