Importance of the agricultural sector in the national economy

Kovács, Gábor

Keywords: agribusiness, TEÁOR, participation in national economy, employment, structural changes

Most of the data published on the actual role of Hungarian agriculture in the national economy are based on rough estimates. Therefore, this article includes an attempt to calculate, based on the available statistics, reliable indices underpinned by a correct methodology. The importance of agriculture and the related supply, processing and distribution activities (agribusiness) is described by output, gross added value and the share in national employment. The revealed decline in these percentages, which are lower than the figures known to the professional public, reflects the well-known trend. Nevertheless, it would be a mistake to claim (even in purely economic or financial terms) that agriculture and agribusiness are loosing importance. The contribution of agribusiness to the GDP is more than half of that of the processing industries (without the food industry). Even today, one in seven jobs in the national economy is directly or indirectly related to agriculture, which makes it an important system of the economy, whose efficiency, competitiveness and development have crucial impact on the state of the national economy as a whole. Our analyses also show that, while the performance of agriculture does not give any reason for satisfaction, both the supply sector and the processing industry suffer from a serious performance deficit compared to agriculture. The agribusiness concept is meant to highlight that no improvement can be expected without the concerted, proportional development of the entire value chain.

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