The British Chamber of Commerce in Hungary (BCCH) has a history of over three decades. Its Chairman, Duncan Graham, who was re-elected at the BCCH General Assembly this May for another two years as head of the organization, tells Diplomacy&Trade about how they managed to handle issues like Brexit, the pandemic or the Russian invasion in Ukraine as well as how the difficulties faced by BCCH members affect accomplishing their environmental goals.
Looking back at the 32 years of BCCH history, the Chairman highlights that the Chamber was instrumental in setting up the EU chamber of commerce as well. “We were one of the founding members and we worked hard to encourage British companies to come here taking advantage of what we considered was a good level of mathematics and a young workforce that were quickly adapting to situations, up until joining the EU. Of course, we were here when Hungary officially became an EU member. So, Hungary was a country for the chamber to establish itself, we were very interested in being part of its commercial growth.”
One of the aims of the BCCH is representing British business values that – as the Chairman puts it – are ones based on hundreds of years of experience of world trade. “Great Britain is still a major economy with a global reach and a vast depth of experience. I think that as a chamber, we're able to tap into that with some of our longstanding companies and then try to pass some of that knowledge and experience to smaller firms or emerging companies within Hungary, including Hungarian companies that are interested in trading in the UK.”
The BCCH was here not only when Hungary joined the European Union but also when the United Kingdom left the EU. “I think it was a big change for us and we faced a series of questions that we had never anticipated and thus, we didn't have our answers ready. However, the withdrawal agreement giving a 12-month period for some of these things to come into effect helped us. The other factor is we don't have so many manufacturing companies here. Many of our multinational companies here are effectively electronic: business service or legal centers and a lot of those were largely unaffected. For some of those with a manufacturing base, Brexit brought tariffs and proof of source of origin for products coming into the EU, as a ‘third country’. So, it produced an awful lot of questions for us as a chamber, but our Embassy and our Department for Business and Trade were hugely helpful. We received assistance both from the British and the Hungarian officials but it was a tremendous challenge.” Duncan Graham admits.
Pandemic and war
The past few years have been plagued by crises like the pandemic or the Russian invasion in Ukraine. The Chairman stresses that “when the pandemic came, we were already on the path to changing working practices. Some of our larger members who have 2,000+ employees in Hungary were already looking at – and had made agreements for – new premises, greener office environments, larger workspace. So, I think the pandemic helped to increase the speed of what was probably going to happen anyway. It also helped moving towards digitalization. For instance, at one of our member companies, there are three Hungarians leading a team of two people in the Philippines and two in somewhere else in the world, online. During the pandemic, there were obviously things that affected us, we couldn't have live meetings with our members, for instance. So, we had to adapt quickly to online presentations, calls, etc. We were not sure whether our members would be satisfied with this new situation and would be worth for them to stay. Fortunately, their answer was ‘yes’, what’s more, with the help of the BCCH team, we've increased our membership – we're nearly 50% up in our membership compared to the pre-pandemic figure.”
This Russian invasion of Ukraine brings different problems. “On the one hand, we have British companies and the British government's line, which is very much in support of Ukraine defending itself, while the Hungarian government is taking a humanitarian approach saying they want negotiation. As a chamber, we're avoiding the political arguments and just trying to help where companies need it. We have had connection with some of the Ukrainian support groups here, who have young Ukrainians, mostly females, looking for a role here and maybe even to settle in Hungary. So, we're helping there as well where we can,” he adds.
As a unique feature on the chamber scene in Hungary, BCCH organizes CEO dinners, which Duncan Graham notes, have been really popular. “There are a lot of medium-level executives (and small companies) making their way, they are ambitious, especially the Hungarians. They want to meet somebody that's already there and we've had some excellent CEOs at these events, they're very open, very keen. They're not sitting back and saying no, we can't talk. And it's not about boasting whether they’re from Tesco or Shell, they’re not saying that ‘we did this’ or that ‘because we're great’. They're discussing the issues they came up against, and how they got around them. It's an open Q&A session and it's not super strict, not a ‘Chatham House Rules’ when you can't ask certain questions. It's very open, which is really interesting. The participating CEOs are experienced and they perform very well at these CEO dinners. Andrea Solti from Shell for instance, was excellent at sharing with the guests, it was just great to see. I don't think that's originally how we set out to create this event, but it has developed well. We are happy to see major companies are now saying ‘yes, we'd like to be a part of that’. Rolls-Royce Aviation has joined the chamber in the last two months, and they'd like to host a CEO dinner.”
Pros and cons in business environment
Feedback from BCCH members also covers more general issues like the business environment in Hungary. As the Chairman recalls, “there are always complaints but there are good sides as well. There are specific advantages like the very low corporation tax rate or the existence of a knowledgeable work base and that of a good skill set on the positive side. At the same time, some industries have specific difficulties, e.g., the likes of Shell and BP when they have their government stipulations that affect them but generally, the mood is good. True, there is high inflation, which has initially been obviously caused by fuel/food prices going up following the start of this Russian invasion; very, very high food and fuel prices.”
This has also affected environmental goals where a lot of companies had a target for moving to zero in terms of emissions and ESG. “Some of those aiming to lower their carbon footprint took a second look because it might be difficult to use the same supply chains they were using before. Then, if you go off on a different supply chain, is that really green, or are they just telling us it's green? There are many current issues around that companies are very much aware of. In order to help with this matter, we've put together an ESG conference coming up very shortly with the support of the British Embassy, using our big consultancy members like KPMG and EY to help smaller companies. The ESG rules will have an impact on a lot of medium and smaller companies regarding what they must do to comply with new EU legislation,” the Chairman of the British Chamber of Commerce in Hungary concludes.
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