EC: Hungary’s economic growth attributed to short-term stimulus measures


Although Hungary’s economy was the fastest growing in the EU in Q2 2014, it was partly due to “the substantially increased absorption of EU funds at the end of the seven-year programing cycle” and “short-term stimulus measures (such as the Hungarian Central Bank's Funding for Growth Scheme, cuts in regulated utility prices as well as the continued expansion of the Public Works Scheme)”, the European Commission’s sixth Post-Program Surveillance mission to Hungary concluded.

The abatement of these stimuli is reflected in the Commission’s projected, slowing, growth. “The government debt is not yet on a firm downward path and that based on the Commission's 2014 autumn forecast, the projected pace of debt reduction appears at risk of breaching the requirements of the Stability and Growth Pact”, the report stated.

The mission underlined that there are “important concerns regarding the substantiation of a number of revenue-increasing measures contained in the 2015 draft budget”. The Commission stressed that “substantial state ownership in the banking sector has the potential to expose public finances to a contingent liability”. The report also concluded that there is a “clear need for more predictable and competitiveness-oriented policies”.


Purchasing Managers' Index rises Analysis

Purchasing Managers' Index rises

Lawmakers approve residency permit for digital nomads Parliament

Lawmakers approve residency permit for digital nomads

The strongest move - Morgan Stanley Hungary head and Chess F... Podcasts

The strongest move - Morgan Stanley Hungary head and Chess F...

New Jewish cultural hub opens in Budapest City

New Jewish cultural hub opens in Budapest


Producing journalism that is worthy of the name is a costly business. For 27 years, the publishers, editors and reporters of the Budapest Business Journal have striven to bring you business news that works, information that you can trust, that is factual, accurate and presented without fear or favor.
Newspaper organizations across the globe have struggled to find a business model that allows them to continue to excel, without compromising their ability to perform. Most recently, some have experimented with the idea of involving their most important stakeholders, their readers.
We would like to offer that same opportunity to our readers. We would like to invite you to help us deliver the quality business journalism you require. Hit our Support the BBJ button and you can choose the how much and how often you send us your contributions.