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Hungary Ancillary Activities
The 1968 reform allowed agricultural enterprises to
diversify
into nonagricultural economic activities. Twenty years
later, the
government granted cooperatives the right to change their
internal structure, to engage in new activities, and to
extend
their involvement in nonagricultural production without
the
permission of regulatory bodies. State farms and
cooperatives
were engaged in food processing, machinery repair, parts
production for manufacturing enterprises, construction,
trade,
and the restaurant business. Several large-scale farms
developed
"technically operated production systems" for crop
production,
horticulture, and animal husbandry that used
state-of-the-art
technology. The farms sold these systems, which included
input
and output programs and consulting services, to other
large-scale
farms. These systems have accelerated the modernization of
the
agricultural sector.
The nonagricultural activities of state and cooperative
farms
have increased profits and tapped manpower once lost
during
off-seasons. In 1983 nonagricultural activities accounted
for 47
percent of state-farm profits and 44 percent of
cooperative-farm
profits. By 1988 the farms' ancillary activities accounted
for
more than 7 percent of Hungary's total industrial
production.
Data as of September 1989
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