OTP Bank for cross-border economic relationships

Hungarian small, medium-sized and large agricultural enterprises —with neighbouring countries as potential primary target markets— have a significant export potential even on the level of national economy. Domestic agricultural businesses, however, need to meet the following three major challenges if they are to be successful in foreign trade: profound knowledge of the target markets, extensive networks of relationships and a stable financial background for the required investments. Having recognised these needs, OTP Bank has launched a series of events, called Cross-Border Business Forum, for domestic and foreign agricultural businesses.

OTP’s agro sector experts are convinced that production specifically for the markets of neighbouring countries may offer great opportunities for domestic small, medium-sized and large enterprises. However, successful foreign trade in agriculture requires businesses to meet three main challenges.

Firstly, they need to have precise knowledge of the markets on which they wish to sell their products. They have to assess which products are in demand, in what quantities and what special needs are to be met. They also need to be aware of specific regulatory requirements in the various markets. Secondly, they need an extensive network of relationships for the efficient and effective organisation of transport, marketing and other relevant processes. And thirdly, they definitely need a stable financial background, constituting a stable foundation to produce their output, carry out developments and being present in the markets of their choice even in the long term.

These are the three areas where domestic agricultural businesses are intended to be assisted by the series of professional events launched by OTP’s Agricultural Directorate. The First OTP Agricultural – Cross-Border Business Forum that took place on 5 September at the Art Hotel in the town of Szeged was aimed at helping business managers to expand their networks of relationships and exchange useful business experience. Agricultural entrepreneurs delivering presentations during the event—including Krunoslav Kovačić, representing the Mihalj Agricultural Company of Croatia—highlighted the importance of cross-border business relationships and opportunities. The head of the Mihalj Group noted: “In the Slavonia region of Croatia, we provide consumers with healthy food products, controlled from field to the table. As a vertically integrated agricultural enterprise, we keep improving and developing through field crop production, livestock production and the manufacture of dairy and meat products, using cutting-edge technologies and learning as much as possible from our partners and competitors, under market conditions.”

“Our experience shows that it is worth considering regional expansion, exploiting the varied and mutually complementary opportunities for production, stemming from our geographical circumstances. Cooperation with partners having local knowledge offers a competitive edge; openness and continuous learning also play a key role”, added Gergely Szeremey, Head of MAVA Befektetési Kft. in his presentation. As to the target markets of Romania and Ukraine, he went on to explain: “Romania is a rapidly developing country whose economy is open to foreign investors, having a robust potential in the development of the efficiency of its agricultural sector, while, despite various challenges, Ukraine offers great opportunities for the region’s investors. They are potentially capable of efficiently supplying large quantities of raw materials, but the required processes are now impeded by a poorly developed infrastructure and bureaucratic complications.”

“In recognition of the needs of agricultural businesses, OTP Bank lays particular emphasis on providing as complex solutions as possible to support farmers in Hungary and across the borders to enter new foreign markets successfully. In addition to this series of events, OTP Bank’s Agricultural Directorate has already been continuously developing its cross-border activities since 2012; these efforts cover not only our complex product and service portfolio but also our systems of cooperation and exchange of information with our subsidiary banks in neighbouring countries”, said Fülöp Benedek, Executive Director of OTP Bank’s Agricultural Directorate.

OTP Group provides agricultural businesses with assistance in accessing information on the target markets, in networking as well as in building up the necessary financial background, with its unique, complex and easily accessible service package. This service is made available through the Group’s international network consisting of the branch units of a total of nine banks, where customers can use our financial and consultancy services in the neighbouring Croatia, Serbia, Romania, Slovakia and Ukraine alike.

“In the framework of its cross-border activities the Bank provides its customers with advice on legal and financial matters as well as the various local markets and regulations, together with a comprehensive financial infrastructure. All of the data and information are also accessible at a single website at: otpagro.com. The success of our efforts made in recent years is clearly proven by the dynamic growth of our clientele: more than 70,000 agricultural entrepreneurs and enterprises do business with the nine banks of the OTP Group”, added Fülöp Benedek.