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Eurofound's EU PolicyWatch collates information on the responses of government and social partners to the COVID-19 crisis, the war in Ukraine, rising inflation, as well as gathering examples of company practices aimed at mitigating the social and economic impacts.

Factsheet for measure HU-2020-17/1241 Updated – measures in Hungary

Subsidy to improve competitiveness in coronavirus pandemic

a koronavírus-járvány következtében szükségessé vált versenyképesség-növelő támogatá

Country Hungary , applies nationwide
Time period Temporary, 21 April 2020 – 31 December 2023
Context COVID-19
Type Legislations or other statutory regulations
Category Supporting businesses to stay afloat
– Direct subsidies (full or partial) or damage compensation
Author Nóra Krokovay (KOPINT-Tárki) and Eurofound
Measure added 05 October 2020 (updated 19 June 2023)

Background information

Under decree 7/2020 of the Ministry of Foreign Affairs (KKM) medium and large companies can apply for funding to improve their competitiveness amid the COVID-19 crisis. The budget for the subsidy programme was originally set at HUF 50 billion (€140 million), but later raised to HUF 169 billion (€469 million). On 6 October the foreign minister said that as a result of long discussions with the European Commission, now large companies can receive funding in proportion to investment pledges without a spending ceiling

Content of measure

Applications for the funding must be filed to the Hungarian Investment Promotion Agency (HIPA). Companies must agree to make investments and to keep employees during their participation in the programme.

Enterprises must show that their sales revenue or the volume of their orders has dropped by 25% as a result of the COVID-19 outbreak and there is a causal link between the outbreak and the losses. The measure targets medium and large enterprises in the manufacturing and BSC sectors, who are “ready to take their business to the next level”. The non-refundable subsidy scheme to improve competitiveness has a maximum subsidy amount of €800,000 per company. The costs of building, land purchase and purchase of assets and intangible assets are also eligible. The amount of aid received depends on the size of the investment. Aid ranges from 30-50% of the value of the investment or €150,000 to €800,000.

On 6 May the HIPA said that the processing of applications has been improved.


The following updates to this measure have been made after it came into effect.

20 December 2022

Ministerial decree 19/2022. (XII. 20.) of the Ministry of Foreign Affairs and Economy extends the deadline for investments receiving the subsidy by one year until 31 December 2023.

08 May 2021

In line with the approval of the European Commission on 6 May 2021, a new Subsidy to Improve Competitiveness has been introduced by the Ministry for Foreign Affairs and Trade, with HIPA Nonprofit Ltd as the managing body. The new incentive program is available from 10 May 2021, for medium-sized and large enterprises throughout Hungary based on the amendment of the Decree 7/2020. (IV.16.) of the Ministry for Foreign Affairs and Trade on the subsidy to improve competitiveness required as a consequence of the COVID-19 pandemic. The beneficiaries shall invest at least €2 million by 31 December 2022 (this deadline could be extended by request through an amendment passed on 23 December 2021). In addition, a minimum of 25 new jobs must be created or a combined increase of 15% in sales revenue and gross wages reached. The investor also has to commit to maintain this increase in the two years following the completion of the investment.

Use of measure

The Hungarian Investment Promotion Agency (HIPA) published a list of companies that successfully bid for the funding with 85 companies on the list (on October 6). The budget for the subsidy programme was originally set at HUF 50 billion (€140 million), with European Commission approval, HIPA said.

On May 28 the call for bids was suspended. In June, the budget was raised to HUF 169 billion (€469 million) of which HUF 150 billion had been paid out to projects until 31 August 2020, HIPA said. According to a press report, the call for applications to receive the remaining HUF 18 billion in the funding scheme was announced at 8am on 1 September 2020, and the subsidy budget was reached within 15 minutes.

The foreign minister said as of 30 September 904 companies were supported in 30 different sectors, creating investments worth HUF 425 billion (€1.18 billion) and that 155,000 jobs were saved as a result.

Target groups

Workers Businesses Citizens
Does not apply to workers Larger corporations
Does not apply to citizens

Actors and funding

Actors Funding
National government
Company / Companies
EU (Council, EC, EP)
European Funds
National funds

Social partners

Social partners' role in designing the measure and form of involvement:

Trade unions Employers' organisations
Role Informed Informed
Form Not applicable Not applicable

Social partners' role in the implementation, monitoring and assessment phase:

  • No involvement
  • Main level of involvement: Sectoral or branch level


The channels of social dialogue in Hungary are fragmented and structures and processes are underdeveloped. Government policy affecting working life is often made outside the interest-reconciliation forums, and, despite strong protest, consultations have little influence. Social partners are mixed in their opinions on whether their involvement would best qualify as "informed" or "consulted", many would rather see it as being in between those two categories, with little influence on the final outcome. You can read more about social dialogue in Hungary here

Views and reactions

There were no social partner reactions raised to this particular case. In general, both the employer and employee sides welcomed government support to businesses in defence of the COVID-19 crisis, but felt the government was not going far enough in helping the most vulnerable sectors


  • 16 April 2020: Foreign Ministerial decree 7/2020 (
  • 07 June 2020: Challenge and opportunity state aid in the covid-19 crisis (
  • 11 June 2020: Subsidy budget raised to HUF169b
  • 01 September 2020: HUF18m support gone in 15 min
  • 30 September 2020: Szijjarto: 155,000 jobs protected (
  • 06 October 2020: HIPA-Competitiveness subsidy winner (
  • 06 October 2020: Subsidy to large companies available
  • 08 May 2021: New VIP subsidy to improve competitiveness for SMEs (
  • 20 December 2021: Changes in the deadline to complete the investment (


Eurofound (2020), Subsidy to improve competitiveness in coronavirus pandemic, measure HU-2020-17/1241 (measures in Hungary), EU PolicyWatch, Dublin,


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Disclaimer: This information has not been subject to the full Eurofound evaluation, editorial and publication process.