The Irish economic expansion did not come overnight following the EU accession either. At the end of the 1970s and the beginning of the 1980s, the Irish government was struggling with considerable state deficit; tax burdens were generally high (for instance VAT was 35%). Moreover, the country faced serious economic recession in the mid-80s and the government introduced severe austerity measures. However, it was vital in the case of Ireland, these measures were supported by the opposition as well. Similarly to earlier Irish governments, the Hungarian government has spent more money than it had budget for, however, it is commendable that based on the policy of „prevention is better than cure”, unlike the Irish, Hungarians did not wait recession to unfold before they curbed expenditures, the analysis says. At the same time, political consensus in relation to austerity measures and tax reforms would be necessary to strengthen business and investment environment. Provided these conditions were realized, Hungarian economic development could be restored to a 4-5% or an even higher level, the analysis elaborates. (Gazdasági Rádió)
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