BMI View: This quarter we have updated and expanded our water forecasts for Hungary, adding in new lines of data, including type of water source. We have substantially upgraded our treated wastewater forecasts based on improved government investment into advanced treatment facilities, and we continue to view the mains and sewage networks as the key future development areas, with losses remaining high, and a significant portion of wastewater not being collected.
The establishing of five regional utilities and over 400 municipal utility companies in the post-Soviet era, and the implementation of water charges being related to delivery costs resulted in a decentralised and incoherent water sector, with each individual municipality having autonomous control. This in turn led to inefficient and frequently overpriced water services. In addition, the maintenance and modernisation of networks was frequently neglected, resulting in high leakages and numerous non-connected settlements; problems which persist in modern day Hungary. This has caused increased pipe bursts, and as operational costs rise but tariffs do not, assets are being used and not replaced, leaving the country in direct violation of the European Water Framework Directive.
However, we view the implementation of the Water Utilities Act in 2011 as a positive development, which will result in the improvement and modernisation of the sector, offering more appealing prospects for services companies and opportunities for infrastructure groups. The rapid consolidation in the water services sector over the past three years is an extremely positive development, which will continue, in our view, and will offer significant benefits to the consumers. Initially at over 1000 utilities, the number is now down to 46, with plans for this to drop further to 40 by the end of 2015, as utilities will have to have at least 150,000 household connections in order to continue to exist.
In addition tariffs are going to be...
The Hungary Water Report has been researched at source and features latest-available data covering public and private sector investment in all major water projects including water extraction, water distribution and water treatment and sanitation projects and also includes competitive intelligence. The report features BMI Research's independent industry forecasts and analysis of latest industry news, trends and regulatory developments in Hungary.
BMI's Hungary Water Report provides industry professionals and strategists, sector analysts, business investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the water industry in Hungary.
- Benchmark BMI's independent water industry forecasts for Hungary to test other views - a key input for successful budgeting and strategic business planning in the Hungarian water industry.
- Target business opportunities and risks in Hungary through our reviews of latest industry trends, regulatory changes and major deals, projects and investments.
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering regulatory changes, major investments and projects and signifi cant national and multinational company developments. These are broken down into Water Extraction, Water Consumption and Water Treatment & Sanitation.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the water and wastewater sectors and the potential affects for industrial consumers, within the broader political, economic and business environment.
BMI Industry & Economic Forecasts
Historic data series (2011-2012) and forecasts to end-2019 for all key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
- Extraction: Total water extraction (mn cubic metres) (% growth y-o-y); underground water extraction (mn cubic metres) (% growth y-o-y) (% of total water extraction); surface water extraction (mn cubic metres) (% growth y-o-y) (% of total water extraction).
- Consumption: Total water consumption (mn cubic metres) (% growth y-o-y) (% of total water extraction); total mains water consumption (mn cubic metres) (% growth y-o-y) (% of total water extraction); household water consumption (mn cubic metres) (% growth y-o-y) (litres per household per day); total non-mains water consumption (mn cubic metres) (% growth y-o-y) (% of total water extraction); water losses total mains water consumption (mn cubic metres) (% growth y-o-y) (% of total water extraction).
- Treatment: Total waste water discharged (mn cubic metres) (% growth y-o-y); treated discharged water (mn cubic metres) (% growth y-o-y); untreated discharged water (mn cubic metres) (% growth y-o-y); mechanically treated wastewater (mn cubic metres) (% growth y-o-y); biologically treated wastewater (mn cubic metres) (% growth y-o-y); combined treated wastewater (mn cubic metres) (% growth y-o-y).
- economy: Economic growth (%); nominal GDP (USDbn); unemployment (%); interest rates (%); exchange rate (against USD).
BMI’s Water Risk Reward Index
BMI’s Risk Reward Indices provide investors (water management, water utility and water infrastructure companies) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.
This is broken down into the following sectors:
- Water supply & Consumption: Where the water comes from, (rivers, springs, lakes, surface water, ground water and so on), key trends with regards to extraction, key trends with regards to overall water consumption, municipal or domestic consumption, and key industrial and agricultural consumption trends.
- Water distribution: This examines how the water is distributed – whether by municipalities, regional organisations or national companies, whether the water networks are nationalised or privatised, and key trends and developments.
- Water Treatment & sanitation: This section evaluates the country’s water pollution levels, the connectivity to water mains and sewage networks, the volumes and methods of water treatment, government initiatives with regards to treatment and sanitation processes and key projects, trends and developments.
- Regulations & Tariffs: Key national and regional legislations with regards to water pollution, extraction and distribution as well as an overview of water rates for domestic and industrial users.
Industry Trends & Developments
Analysis of latest projects across the water infrastructure sector including water and wastewater treatment plants, desalination facilities, mains water and sewage network expansions, dams, and hydropower plants.
Provides an overview of key government ministries overseeing the water sector together with regulatory organisations, alongside the central companies involved in water and wastewater distribution and treatment services in the country.
The Water Market Reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.