BUDAPEST, April 6 (Reuters) - A free-trade accord between the United States and the European Union (TTIP) could expand Hungary’s economy by up to 0.3 percent, mostly by boosting the car sector, central bank Deputy Governor Marton Nagy said.
Politicians on both sides of the Atlantic are pushing for a deal known as the Transatlantic Trade and Investment Partnership (TTIP) to eliminate all tariff barriers between the United States and 28-member EU.
Hungary’s car sector, where the key players are German Daimler and Audi, GM’s European division Opel and Japanese Suzuki, accounts for over a fifth of industrial output and more than a tenth of exports.
The sector employs over 100,000 people and has been a key driver of economic growth and investment.
“The assessment is positive overall. Hungary would be a clear beneficiary of the TTIP due to the car industry,” Nagy told a panel discussion.
He said Hungary’s economy was increasingly reliant on the car sector and the German industry in particular, which could be a “clear winner” of the accord.
“People would not be driving Hummer vehicles in the streets of the U.S. but more economical Opels and green BMWs,” he said.
Nagy said the central bank estimated that Hungary’s gross domestic product could increase by 0.3 percent due to the agreement under an ambitious scenario, which also sees a 15-20 percent rise in exports and 22,000 news jobs.
A conservative projection sees a 0.1-percent rise in GDP, a 5 percent increase in exports and 6,000-8,000 additional jobs, Nagy said, adding that a lot depended on whether Britain decides to leave the EU later this year.
But he said some sectors, such as European smallholders and uncompetitive small businesses, could lose out.
Advocates of TTIP say the accord would bring big benefits as it would unite half the world’s economy and remove barriers for small companies to do business.
After more than two years of talks, both sides say a deal could be clinched this year before Barack Obama’s term as U.S. president ends. Waiting for a new president with different objectives risks severely delaying any deal.
Prime Minister Viktor Orban has said Hungary would not back any accord that impairs the jurisdiction of Hungarian courts in trade disputes. His government also wants to uphold a ban on genetically-modified crops in Hungary. (Reporting by Gergely Szakacs; Editing by Raissa Kasolowsky)