Thanks to the Hungarian economy’s growth rate above the EU average, the government’s predictable economic policy and the reduction of taxes, Hungary and within it Budapest in particular will continue to remain attractive investment destinations also in the years ahead, Péter Benő Banai told the Hungarian news agency MTI.

The Minister of State for State Finances of the Ministry of Finance highlighted that in the second quarter the Hungarian economy grew by 5.2 per cent, and with this result it is second in the rankings of EU Member States.

This is recognised increasingly by domestic and international analysts as well, resulting in the upgrading of economic projections relating to Hungary. Compared with 2010, the Hungarian economy has expanded by almost 30 per cent, and the dynamism of that expansion rests on stable foundations. In order to protect the results we have achieved, we must continue the work we have done so far, he added.

The discharge legislation for last year submitted to Parliament does not only show that the various tax reductions and tax benefits have left hundreds of billions of forints with families with children, members of the public and businesses, but also that, thanks to the economic growth above five per cent, the deficit of the budget turned out to be lower than planned, standing at 2.3 per cent, while the sovereign debt rate decreased to 70.2 per cent. This is significantly, 2.7 per cent lower than the year before, Mr Banai highlighted.

He added that so far this year’s data is promising as well. The number of people in employment is above 4.5 million on a long-term basis, earnings are rising at a rate of more than 10 per cent, and with its growth above five per cent in the first half of the year, Hungary is second in the rankings of EU Member States, exceeding their average almost four-fold. In the first six months, the sovereign debt rate decreased to 68.2 per cent, while the situation of the budget is stable; the deficit could remain at around 1.8 per cent by the end of the year despite the increasing family support benefits and tax reductions implemented during the year. All these figures show that a predictable economic environment guarantees the conditions necessary for growth.

Based on the above, it is not surprising that in various domestic and international projections, growth expectations for Hungary are being upgraded one by one. According to the Ministry, the annual growth rate could be 4.6 per cent, higher than planned even in the slowing world economic environment, Mr Banai stressed. In the spring, the credit rating agencies Standard & Poor’s and Fitch Ratings upgraded our rating by one notch in the investment category, with a stable outlook, while Hungary has also managed to climb up in the latest competitiveness rankings of the World Economic Forum (WEF), the Minister of State highlighted.

Mr Banai pointed out that upon determining economic policy measures, it is necessary to take account of uncertainties and the European and world economic environment that is facing challenges. Therefore, in the interest of protecting the results achieved and maintaining an economic growth rate minimum 2 percentage points above the EU average also in the future, the measures of the Economy Protection Action Plan and the elements of the competitiveness programme could serve as a guarantee.

(MTI)