Hungarian Prime Minister Gordon Bajnai said on Wednesday that the worst risks of the crisis are over, Hungary has turned away from the edge of the cliff.
Interviewed by CNBC television, the prime minister said, however, that the global crisis is not over until unemployment starts to shrink, which he added could occur in half a year at the earliest.
Nevertheless, he said that since 80 percent of Hungary’s GDP comes from exports, if the key markets – Germany, France, Italy – start growing earlier than expected, Hungary could also recover earlier from the crisis.
He also emphasised that with the 3.8 percent of GDP deficit targeted for 2010, Hungary will have one of the most prudent fiscal policies among European countries – compared to a European average of 7.3 percent next year.
Speaking of the banking system, Bajnai said a number of restrictions and changes have been introduced with regard to the banking system and the banking authority, but the healthiest policy in this respect is to keep the economic fundamentals stable and thereby keep the currency stable. He emphasised that the forint improved over 10pc in the last six months against the euro, Hungary has pursued a strong economic policy and has regained investor confidence.
“Nevertheless, he said that since 80 percent of Hungary’s GDP comes from exports.”
Sure and he forgot to mention the +30% of GDP is lost in the black market primarily, I believe, because taxes are crippling. To pay them and survive as a business is near to impossible for all but those companies that have a presence in other countries to play tricks with.