National economies continue to face considerable challenges, presenters stressed at the conference organized by the Ministry for National Economy in Budapest. Muted competitiveness growth within the global economy was singled out as one of the factors that can aggravate a crisis situation. In Europe, Brexit may further depress competiveness growth.
In his opening speech, Minister for National Economy Mihály Varga called the tightening of economic cooperation within the EU a task of top priority. At the conference entitled “From crisis management to launching economic growth” organized by the NGM, the Minister pointed out, one must not forget that the European Union has stemmed from economic partnership and today’s efforts must focus on strengthening this.
OECD Chief Economist and Head of the Economics Department Catherine L. Mann analysed the factors behind the deceleration of global economic growth in her presentation. In her opinion, the insufficient level of innovation within economies is one of the major issues waiting to be addressed, as only some 5 percent of enterprises utilize advantages offered by innovation. As another problem, Ms Mann highlighted the sluggish pace of wage growth: wages rise slower than productivity, and thus income disparity has been rising.
State Secretary at Germany’s Federal Ministry of Finance Thomas Steffen emphasised that one of the key conclusions one could draw in recent years was that there is no universal, one-size-fits-all formula against economic troubles that could be made mandatory. The sovereignty of EU member states must be accepted and respected. Speaking of Brexit, Mr Steffen said that a potential domino effect must in any case be avoided and close ties must be maintained even after the exit. As another goal, Mr Steffen mentioned the modernization of public administration in order to make the EU more attractive for investors. The politician added that Germany wanted to remain Hungary’s reliable partner also in the future.
At a panel discussion, participants agreed that geopolitical risks require that the coordination of fiscal, monetary and structural policies within the EU remain a priority. They also drew attention to the fact that the manouvering room of Hungary’s economic policy has been significant limited as the level of the country’s state debt and fiscal deficit must be simultaneously reduced.
(Ministry for National Economy)
