Hungarian Heritage Review, 1987 (16. évfolyam, 1-12. szám)
1987-10-01 / 10. szám
The McDonald’s Corporation has been considering launching a fast food restaurant chain in Hungary for more than a decade. They made a series of market surveys, negotiated with several companies and eventually found the right one, the Babolna State Farm, with whom they signed an agreement in late 1986 to set up a joint venture. According to the agreement, the joint venture has a capital stock of HUF 120 million, shared fiftyfifty by the two partners, and it will operate five restaurants in Hungary. The first one is scheduled to open in mid-1987 in central Budapest. It’s not that construction work takes so much time, rather that the period is needed for the Hungarian personnel and the state farm to get acquainted with this U.S. fast food chain’s unique requirements that ensure the same high standards and uniform tastes anywhere in the world. The director of the joint venture, for instance, is learning McDonald’s management through on-the-job training in England, the FRG and in the U.S. The majority of raw materials, like baker’s ware, hamburgers and dairy products, will be provided by the Babolna State Farm and packaging materials, too, should come from a domestic source. On the occasion of the signing of the agreement, Steven J. Barnes, vice-president of McDonald’s Corporation held a press briefing where he said that his company did not expect the joint venture to make profits in the first 10 years and thereafter profits will be reinvested. Robert Burgert, general manager •pateltne llutmpest of the Babolna State Farm told the press that his company would not pay brand royalty in the first two years and from the third year on the U.S. company would buy back the sum of the royalty in the form of Hungarian products. This is the first time that McDonald’s has established a chain in Central Europe. Simultaneously with the agreement in Hungary, they signed a similar one with Yugoslavia. This corporate giant operates restaurants in 42 countries all over the world. One-fifth of the company’s total turnover of USD 11 billion is made outside the U.S. Last year alone they opened 600 new restaurants, 40 per cent of which were abroad. The immense popularity of the chain is due not only to its tasty hamburgers and crispy chips but at least just as much to the fact that McDonald’s meticulously and rigorously controls the observance of its set of rules in its restaurants, be they anywhere in the world. Should any such restaurant fail to keep all those strict rules, McDonald's withdraws the franchise. This is why the U.S. company takes its time to choose its foreign partners. In August, 1983, the First World Conference of Hungarian Doctors was held at the Hungarian Academy of Sciences. Over 200 Hungarian doctors from 22 countries of the world attended the conference, where 137 lectures were presented in five different groups. Because this conference was so important and successful, the Medical Science Department of the Hungarian Academy of Sciences, the Federation of Hungarian Medical Societies — MOTESZ and the Hungarian Forum — World Federation of Hungarians — decided to organize the Second World Conference of Hungarian Doctors between August 15-20, 1988 at the Semmelweis University of Medical Sciences in Budapest. It is expected that hundreds of Hungarian doctors living and practicing in all parts of the world will participate in this important conference dedicated to the advancement of medical and pharmacological science for the benefit of mankind. Officials in Budapest are preparing a new law to legalize private share ownership, anticipating the creation of the first stock market in Eastern Europe. This law will be presented to the National Assembly this year and it is expected to go into effect on January 1, 1989. While the very concept of a stock market in Hungary seems somewhat bizarre, it actually builds on Western-style innovations that have characterized Hungarian development in the past few years. There is actually a small group of entrepreneurs who have been making money from the tiny bond market that actually exists in Hungary. It is hoped that this device will assist cash-strapped enterprises to raise money and to allow them to pay their workers with shares in order to encourage and increase productivity. Among other things it is hoped that this new procedure — continued next page 8 HUNGARIAN HERITAGE REVIEW OCTOBER 1987
