Green development injects new impetus into China-Hungary mutually beneficial cooperation

Estimated reading time: 5 minutes

By Yu Limin, Zhang Huizhong, People's Daily

In recent years, under the strategic guidance of the leaders of both countries, the Belt and Road Initiative (BRI) has been aligned with Hungary's "Opening to the East" policy, resulting in fruitful cooperation across various sectors.

Significant achievements have been made in green development areas such as new energy vehicles, lithium-ion batteries, and photovoltaic products, injecting new impetus into the mutually beneficial cooperation between China and Hungary.

The automotive industry is one of the pillars of Hungary's economy. More than 10 out of the top 20 global automobile manufacturers have established vehicle manufacturing plants or automotive component production bases in Hungary.

To embrace green transformation in the transportation sector, the Hungarian government launched an electric vehicle development plan in 2016. Chinese electric vehicle companies have been closely cooperating with Hungarian counterparts, and their brand recognition has been continuously increasing.

In April 2017, an electric bus factory of Chinese new energy vehicle manufacturer BYD in north Hungary's Komarom officially started production. It is BYD's first electric vehicle factory established in Europe.

In September 2022, Chinese electric vehicle maker NIO's first overseas factory was put into use in Biatorbagy, Hungary. The factory serves as NIO's manufacturing, service, and research center for charging products in Europe, providing local consumers with battery swapping stations.

In January this year, BYD set up a new energy vehicle production base in Hungary's Szeged, which is the sixth Chinese automotive manufacturing plant in Hungary and is expected to offer thousands of job opportunities.

"Hungary has a mature industrial chain for automotive manufacturing. While leveraging Hungary's advantages in the industry, we are bringing advanced manufacturing techniques and highly automated production lines to the Hungarian market from China, so as to support the electrification of the Hungarian automotive industry and promote technological exchange and innovation between China and Hungary," said an executive from BYD.

Hungarian Minister of Foreign Affairs and Trade Peter Szijjarto said that the automotive manufacturing sector is a pillar industry in Hungary, and attracting Chinese investment is crucial for strengthening Hungary's position in global new energy vehicle development.

Power batteries are key components of new energy vehicles, accounting for approximately 40 percent of the total vehicle cost. With advantages such as fast charging, long range, and high safety, Chinese lithium-ion batteries have become an important aspect of China-Hungary cooperation in the field of new energy.

In March 2022, Chinese lithium-ion battery company EVE Energy Co., Ltd. (EVE) announced a plan to build a factory in Debrecen, Hungary to produce cylindrical cells.

Five months later, Chinese battery manufacturer and technology company CATL also announced to build a battery plant in the city, which will become one of the largest battery factories in Europe once completed.

Additionally, other Chinese power battery companies and related material enterprises, such as SEMCORP, Huayou Cobalt, and Sunwoda, have also started building factories in Hungary.

The investment of Chinese battery companies like CATL in Hungary has stimulated the development of the Hungarian battery industry, and factories built by Chinese carmakers including BYD in Hungary have also promoted the development of the local automotive industry, said Andrea Nagyne Boda, head of the International Cooperation and Development Finance Department at the Ministry for National Economy of Hungary.

Hungary-China cooperation projects not only benefit the Hungarian people but also contribute to the entire Europe's enjoyment of the benefits of new energy, Andrea added.

Hungary's electricity import stands at around 30 percent. In order to diversify the country's energy supply, the Hungarian government has been actively exploring solar energy resources and developing the photovoltaic industry.

In June 2019, China National Machinery Import & Export Corporation (CMC) under China General Technology (Group) Holding Co., Ltd., invested in a 100 MW solar park in Kaposvar, Hungary, which is one of the largest renewable energy facilities in Hungary.

Since its operation in 2021, the solar farm has generated over 140 million kilowatt-hours of electricity each year, which is equivalent to saving 45,000 tons of standard coal and reducing 120,000 tons of carbon dioxide emissions on an annual basis.

CMC implemented a series of environmentally friendly measures when the solar farm was constructed. For instance, it replaced impact piles with spiral pile photovoltaic brackets to minimize land damage. It hired landscape experts for ecological planning and conducted large-scale greening around the factory area.

Kaposvar's mayor Karoly Szita said that the Kaposvar solar farm is not only an exemplary collaboration in clean energy between Hungary and China but also a testament to the friendship between the two countries.

"Green transformation is a global trend, and the development of new energy is crucial for restructuring global energy supply. China has provided us with excellent opportunities in this field, and the deepening of green cooperation between our two countries has achieved mutual benefits and win-win outcomes," said Marton Bokay, deputy state secretary of the Hungarian Ministry of Economic Development.