May 15th, 2012

Hungary will heed IMF/EU advice on economy policy, says Orbán

Hungary is ready to change economic policies in light of talks with the IMF and EU, and lawmakers will have to attend sessions until the middle of July because the situation in Europe could require a response by the Hungarian parliament, Viktor Orban, the prime minister, told journalists after a meeting of the ruling alliance’s parliamentary group on Monday.

Asked about what the International Monetary Fund and European Union would expect from Hungary’s newly appointed chief negotiator to the talks, Mihaly Varga – who is to take up his post on June 1 – Orban underlined that the government wanted talks to start as soon as possible and to be concluded successfully, but he also said the government was ready to listen to their suggestions.

“I expect him to convey economic considerations in terms of changes that may be needed in Hungarian policymaking. It is not me who will give him instructions, though this may be possible. Rather, the main thrust is that he briefs [the government] about proposals which emerge during the talks,” he said, adding that the relationship would be “more than one of equals” over the next 2-3 months.

On the subject of the economic situation in Europe, Orban noted that Greece was in big trouble and the French election had led to an outcome of uncertainty in several respects, and Hungary should therefore be prepared to operate amid an unpredictable economic environment over the next few months.

Apart from dealing with such possible eventualities, lawmakers must also agree on the framework for the 2013 budget, he said, adding that only decisions about larger sections of the budget would have to be dealt with in September.

He said attempts would be made to ensure that Hungarian economic policymaking is predictable and the budget is solidly planned insofar as the situation in Europe permits.

Orban said he trusted that the country’s new economic system set up two years ago in order to stabilise Hungary’s financial situation would “altogether be capable of a greater performance than is generally thought to be the case today”.

The prime minister emphasised, however, that policymaking must be more careful and plans must be made to be extra safe amid the currently fragile environment.

If extra revenues flow in then work-related taxes and contributions will be reduced, he said, adding it was not worth discussing such possible measures until the end of September or the start of October.

Also at the meeting of Fidesz and the Christian Democrats, Orban proposed that Antal Rogan take over from Janos Lazar as the group’s leader in parliament. Lazar is to be appointed as Orban’s cabinet chief. Rogan will take up his post by June 1.

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  • Aloof

    Translation: OV and Fidesz have no clue what’s going to happen. Their economic strategies have basically been reactive not proactive which has resulted in trying to tax their way out of trouble just to tread water. They have lied to the banks and Telcos (another crisis tax which has actually doubled and is illegal) and have no viable realistic plan for growth. The drivel continues…

  • Feher Gyorgy

    Since Orban is in power the Hungarian economy has become very dynamic. Just today it was anounced that the economy contracts 1.3%, and we all now that small is beautiful and profitable.

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