PM says investments will increase in 2008-2009

Banking

Investments as a proportion of GDP will increase from 23-24% to 25-26% in 2008-2009 as EU and related subsidies will exceed 3% of GDP by 2009 and thanks to a soon-to-be-launched government-sponsored program to encourage investments at SMEs, Prime Minister Ferenc Gyurcsány said in an interview published in the latest issue of business weekly Figyelő published on Friday. Investments will increase because of more EU funding available from 2007 and because of higher economic growth, Gyurcsány said. He added that austerity measures would end in 2008 and less money would be required from the market to finance the general government deficit. Gyurcsány said the introduction of the tax on companies' stock of cash as well as a new rule requiring companies to pay payroll taxes on at least twice the minimum wage would cause the informal economy to contract and contribute to economic growth. (Mti-Eco)

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