"I still stand by this: we should support foreign investors who, for decent profit, create jobs for Hungarians and using Hungarian labor they create value," Prime Minister Viktor Orbán told an audience of his supporters back in February, praising Nokia along with companies like German car makers Audi and Daimler. "These firms must be welcomed and kept around," Orbán said. The situation has changed a lot since then. 

The Finnish handset maker Nokia will lay off 900 people at its base in the Hungarian city of Komárom on Tuesday, chairman of the plant’s labour council Zoltán Laszló told MTI. This is the second phase of a previously announced 2,300 layoff at the Hungarian plant.
Nokia already laid off 1,200 people on March 29, of which 854 were Hungarian and 343 Slovaks commuters.
Nokia announced in February transferring production from three of its plants, Komárom, Reynosa in Mexico and Salo in Finland, to Asia, laying off about 4,000 workers in the process.

Nokia arrived in Hungary during the boom years of the late 1990s. As its devices reigned supreme on global markets, Hungary produced so many that consumers in Asia and Africa often came to identify the country with the Nokia phone.
But globalization has moved more jobs further east to Asia, and the spread of smartphones has knocked Nokia off its throne in the mobile world, spelling bad news in Komárom, a town of just 20,000 residents in the northwest of Hungary. Komárom is separated from Komarno in Slovakia only by the Danube river, and many Slovaks commute every day to work in the Nokia plant.
It remains to be seen just how big a dent Nokia's move will put in Hungary's economic output. The firm's Hungarian revenues have topped 1 trillion forints ($4.56 billion) per year despite any recent market trouble.

Source: Reuters, Index, MTI

Last Updated on Wednesday, 27 June 2012 07:12