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Debt rises to all-time high, government spins figure

MNB

Hungary’s gross consolidated government sector debt, calculated at nominal value, in line with the Maastricht methodology, rose to HUF 24.904 trillion or 84.6% of gross domestic product at the end of March 2014, the National Bank of Hungary (MNB) yesterday reported, based on financial accounts data.

The debt ratio rose from 79.2% at the end of 2013.

State Sec.: Public debt actually “following decreasing trajectory”
After the release of the surprising figures on Hungary’s public debt, the central government was naturally ready with an explanation. Applying spin to the numbers was National Economy Ministry State Secretary Gábor Orbán, who informed national news service MTI that “independently from first quarter data published on Monday showing a jump in consolidated government-sector debt, Hungary’s public debt is following a decreasing trajectory.”

According to Orbán, the ministry is currently emphasizing financial stability and thus “is financing the public debt in a secure way.” Orbán attributed the increase in public debt for Q1 as due to a $3 billion forex-based debt issuance which in theory “will pay for maturities this year.” Orbán stated that the central government in fact repaid £500 million in debts last week; another €3 billion is reportedly slated for repayment by the end of autumn.

Orbán went on to tell MTI that “During the year, there may be ups and downs but what is important is the level of debt at year’s end.”

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