Development minister says citizens, government and companies must jointly bear risks

National Development Minister Tamás Fellegi said at a meeting of the American Chamber of Commerce in Hungary (AmCham) on Tuesday evening that, contrary to previous practice, citizens, the government and companies must jointly bear economic burdens and risks.

Fellegi told AmCham that government initiatives announced this week, which include a plan allowing Hungarians with foreign-currency-denominated mortgages to pay back their loans in a single installment at a fixed exchange rate, as well previously implemented measures such as the extraordinary financial-, energy-, telecommunications- and retail-sector taxes, are aimed at achieving this objective.

Fellegi remarked that government's goal is not to punish the financial sector, asserting that to do so would be irresponsible. The development minister, however, acknowledged that some of the government's measures have been very painful for companies and investors, adding that they must understand that the era of guaranteed profit is over.

Fellegi said that the government is fundamentally open to debate on its economic policy, though in some instances, notably with regard to the financial-sector tax, has chosen not to discuss measures beforehand, because to do so would have made them impossible to implement.

Fellegi told AmCham that the government's decision to purchase of a 21.2% stake in Hungarian oil and gas company MOL from state-owned Russian peer Surgutneftegas last year was based on geopolitical, not commercial factors. The national economy minister commented that the government has not reached its goals with regard to energy policy, particularly concerning its influence over energy prices. Fellegi said that the government, for example, has no control over long-term energy contracts with foreign companies such as Germany's E.On and Russia's Gazprom.