Dubai: Hungary’s Export-Import bank has opened a $406 million (Dh1.49 billion) credit line to Emirati and Hungarian companies as a means to grow economic ties between the two countries.

Hungary’s Minister for Foreign Affairs and Trade Péter Szijjártó announced the finance facility in an address at the Dubai Chamber of Commerce and Industry on Tuesday.

The $406 million credit line is to help facilitate export and import transactions and for Emirati and Hungarian companies working on joint projects and joint ventures, Szijjártó said.

“We understand here in the UAE cash shouldn’t be a problem but regarding Hungarian companies we really do have to subsidies them in order to be able to do business here,” he said.

Hungary has attracted investment from three major UAE companies with Emirates opening a call centre in the Central European country in 2014, Al Ghurair Group subsidiary Taghleef Industries has an operation there with over 200 staff and Al Habtoor Group owns two hotels in the capital, Budapest.

Szijjártó said Hungary has offered cash incentives and tax subsidies to Taghleef Industries to expand its operations.

The Foreign Affairs Minister is in the UAE this week to take part in the first joint economic committee meeting between his country and the UAE.

The findings of the committee will be released on Wednesday in Dubai and Szijjártó said the two countries should finalise an investment protection agreement in the first half of the year.

Dubai Chamber Chairman, and Al Ghurair Group Chief Executive, Majid Saif Al Ghurair estimated that bilateral trade is worth $700 million annually, although he said the two countries disagree on the actual number. Regardless, Szijjártó said “trade is too low.”

Hungary, who relies on the European Union for 80 per cent of its trade, is the UAE’s 59th largest trading partner, while the UAE is Hungary’s largest in the Middle East, according to Al Ghurair.

The two countries are looking to boost cooperation with Hungary pitching itself as a major food source for the UAE, who import 85 per cent of its food and agriculture needs.

Szijjártó, who announced the credit line to an audience that included the UAE Minister of Economy Sultan Bin Saeed Al Mansouri, said the two countries have agreed to increase Hungarian food exports and negotiate export licences.

Al Mansouri, who visited Budapest last year, said the Central European country is capable of providing “a lot” of the UAE’s food needs.

Hungary is also looking for contracts in the energy and water sectors with the UAE one of the world’s largest per capita electricity and water users.

“Our companies have the talent, have the know-how [and] have the technology,” Szijjártó said.

Nuclear energy and water management, including irrigation and desalination, were raised as areas suited to Hungarian expertise.

Al Mansouri, in his address to the audience that also included members of Hungary’s private sector, tried to alleviate concerns over the impact the falling oil price is having on the UAE economy.

“Here in the UAE I can assure of one thing, growth will continue,” Al Mansouri said, repeating recent comments the economy will grow on an average of 3 per cent “depending on the price of oil.”

The International Monetary Fund in February lowered its forecast for growth in the UAE to 2.5 per cent this year from 3 per cent.

The UAE relies on hydrocarbon revenues for 30 per cent of its gross domestic product (GDP) and has targeted to cut this to 20 per cent by 2021. Al Mansouri said that figure could be cut by 20 per cent by 2035.

On Tuesday, Dubai’s Chamber of Commerce and Industry signed a cooperation agreement with its Hungarian counterpart and Hungary’s National Trade House.