Hungary’s centre-right Fidesz government on Wednesday approved a plan to reduce the country’s budget deficit to below 3 percent of gross domestic product (GDP) next year, Economy Minister Gyorgy Matolcsy told reporters after a government session.
Matolcsy said that Hungary would not sign a new loan agreement with the International Monetary Fund (IMF) and the European Union beyond the expiry date of the current agreement in October and November.
He said that the most important conditions for achieving the deficit goal were meeting this year’s deficit target of 3.8 percent of GDP as well as extending the newly introduced bank levy into next year.
The minister added, however, that economic growth of 2.5-3 percent, changes to make public administration cheaper to operate and creating fiscal transparency at state-owned companies were also necessary to push the deficit below 3 percent in 2011.
Matolcsy also said that this year’s target of 3.8 percent would be met if the planned 200 billion forints (EUR 692.57m) actually flows in from the bank levy and if public expenses for this year are reduced by 120 billion forints.
He added that Hungary has no official date for introducing the euro, but as it has assumed responsibility for joining the eurozone in 2004, it would do so at some point.
The National Asset Management Company will be set up on October 15 to handle mortgaged homes whose owners are unable to pay their debt, Matolcsy said.
But the government reported within the past few days
that they have only collected half of the projected
corporate income tax for this year. And a growth
rate of 2.5 to 3 percent for 2011 is pure pie in the
sky. Matolcsy is out of his mind or lying. Oh, I
forgot. Only the socialists lie about the economic
situation. Would this justify riots in the streets
and camping out on Parliament grounds? Now wouldn’t
that be a delicious irony for Mr Orbán?