Foreign Trade Relations Between Ukraine and Hungary Amidst War Conditions

Abstract

The article is dedicated to the study of the current situation of trade and economic relations between Ukraine and Hungary in the context of the challenges associated with the war. The article presents modern trends in the development of Ukrainian-Hungarian trade and economic relations, identifying the following research tasks: to assess the state of dynamics of key indicators of foreign trade relations in 2022-2023 and the first quarter of 2024; to highlight the main groups of commodity products that form the basis of bilateral trade between the countries; to systematize the factors hindering trade relations, and to provide constructive proposals and recommendations for enhancing bilateral trade and economic cooperation. The research is based on analytical, institutional, systemic, graphical, and statistical analysis of data and processes related to the investigated issues.The article states that after the onset of the full-scale Russian military aggression up to mid-2023, Hungary became a major and geographically close market for Ukrainian agricultural products, a transit country for exports, and a supplier of energy resources that became critically important for the Ukrainian economy. Ukraine holds a prominent place and is considered Hungary's most important trading partner, as in 2023, Ukraine was the 4th largest trading partner of Hungary outside the EU, surpassed only by the USA, the UK, and Serbia. The article formulates directions that could promote the development of Ukrainian-Hungarian trade relations: the possibility of constructing a bypass road around the city of Berehove with financial support from the Hungarian government; redirecting cargo flow towards the "Tysa" and "Astey" border crossings to reduce border queues; connecting the Hungarian M3 highway with the international "Chop-Kyiv" highway to facilitate the transition of internal transport flow into the international corridor to Trieste; reconstructing the bridge over the Tysa to increase the capacity of border crossings, and opening new border checkpoints between Ukraine and Hungary (e.g., Velyka Palad - Nagyhodos) and converting existing ones to round-the-clock operation; increasing rail connections for agricultural products through Hungary towards Trieste or Constanța to alleviate existing goods warehouses and accommodate the new harvest of 2024. It is noted that positive structural changes in trade relations between the countries should be expected after the end of military actions in Ukraine.