Start of IMF, EU talks hinges on new Central Bank Act, says Commission spokesman

A decision by the International Monetary Fund and the European Commission to return to Budapest for talks on financial assistance for Hungary hinge on the country’s contentious new Central Bank Act, Commission spokesman Olivier Bailly said at a press briefing in Brussels on Tuesday.

"Because of the lack of certainty of the legal environment around the central bank, which is very important to ensure the financial stability of the country, the IMF and the Commission have not decided yet to come back to Budapest for the start of formal talks on the assistance," Mr Bailly said.

Hungary formally requested financial assistance from the IMF and the EU in November. The request was accepted and Hungarian authorities requested preliminary talks in Budapest in mid-December.

However, Commission Vice President Olli Rehn decided to "interrupt" the mission because of "concerns" about the draft law on the central bank and the "absence of answers from the Hungarian authorities", Mr Bailly said.

In an interview on public radio before the new Central Bank Act was passed on December 30, Prime Minister Viktor Orban said that the government had accepted 13 of the 15 points concerning the new act that Brussels had made. He added that two remained on which there were differences of opinion that the country would "fight in the framework of a legal procedure" if necessary.