November 22nd, 2011

A Populist’s Lament – Viktor Orban has made Hungary a ripe target for doubters

For most European governments, the stigma attached to being on the Brussels dole may no longer be what it once was, what with the queue now reaching from Athens to Dublin to Lisbon. But for Hungarian Prime Minister Viktor Orban, whose government has now formally requested EU-IMF lending, the embarrassment is likely to be intense.

Mr. Orban’s relationship with Brussels and the Fund has been fraught. After his center-right Fidesz party took office last year, he very publicly terminated a 2008 emergency lending arrangement in order to “regain Hungary’s lost economic sovereignty.” By walking away from the €20 billion in remaining rescue funds, Mr. Orban declared that he could pursue a “patriotic economic policy” free of external meddling. Hungarians cheered.

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  • spectator

    Eric, you have to update your bearings!
    You said:”center-right Fidesz party” – dear, there is no center, and even if it was, it isn’t right!

    Fidesz – in principle – is, what Mr.Orban feels at the very morning, and even that isn’t entirely sure, because it takes time, while he gets to his office…

    So, being at the “center” of something would need some consistency – which is quite fictitious, if it comes to Mr.Orban – one of the most successful turncoats of (Hungarian) history..!

  • MHL

    A couple of reminders on how Orban Viktor incurred the wrath of the IMF and Simor Andras, the Magyar National Bank, boss …
    “Now, the government of Viktor Orban, whose party won a landslide with more than two-thirds of the Hungarian parliament in April, has taken aim at the country’s central bank, blaming it for keeping interest rates too high and thereby delaying the recovery. The government cut the salary of the Andras Simor, the governor of the central bank, by 75%
    First, the Hungarian government decided in early July to levy a new tax on banks and other financial companies, which would raise some $855m this year and next. Foreign banks, which made a fortune during Hungary’s bubbly growth years prior to the crash in 2007, screamed and lobbied, but – despite having the IMF in their corner – did not prevail.
    Then, the government refused to give in to IMF demands for further budget deficit reduction. Hungary has already been through nearly four years of austerity in which the deficit was reduced from 9% to 3.8% of GDP. More importantly, the country’s current account deficit – its imbalance with the rest of the world, which was more than 7% of GDP in 2008 – is less than 1% for this year. With unemployment having risen from 7% in 2007 to nearly 12% today, and the economy still barely growing, Hungarians were understandably beginning to wonder when they would see light at the end of this long tunnel. Negotiations with the IMF over conditions for further access to IMF funds broke down on 17 July 2010” (The Guardian)

  • Molehandles

    Moody’s have downgraded Hungarian debt to “junk” status because of
    weak growth prospects and the “high” level of debt.
    Hungarians are paid low wages and their service reflects that insofar as
    they do not understand the concept of customer service and, if they did,
    would challenge its efficacy at every juncture.
    It’s simply not in their characteristics based on a lifetime of “opportunism” and “short- term” gain courtesy of the doctrine of former residents of the Red menace/communist variety.
    No place to run, and no place to hide for the poor leadership and a host of inadequate ministers.
    The consequences? The begging bowl is out yet again and Orban Viktor is sent groveling like Oliver Twist to the IMF to ask for “MORE”?!

  • Viking

    In Hungarian media they are reporting that the Hungarian Police is looking for “unknown perpetrators” who have sunk the Forint

    It is not a joke…

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