Hungary likely to wait on foreign bond issues till after IMF-EU deal
Hungary will probably wait until after it reaches an agreement on precautionary financial assistance from the International Monetary Fund and the European Union to start foreign bond issues planned for this year, deputy state secretary at the National Economy Ministry Roland Nátrán suggested at a conference organized by business daily Napi Gazdaság on Thursday.
Nátrán said the most advantageous time to start the €4 billion of issues planned for 2012 would be after the successful close of negotiations with the IMF and the EU.
Maturing foreign currency debt is €4.7 billion, including about €1.3 billion in bonds and €3.3 billion due on the IMF loan Hungary received under a standby arrangement reached late 2008. The gap will be financed by international project-financing loans according to earlier information from government debt manager AKK.
Market financing of the Hungarian state was secure, he said. "I don't see any trend that would endanger daily or weekly financing," he added.
He noted that the government had €1 billion deposits with the central bank which would grow to €1.5 billion by the end of 2012. The deposits are from the drawn and unused part of the previous IMF-EU loan which will grow after repayment of amounts lent to banks, earlier information from AKK shows.
While the net financing requirement of Hungary's general government is low this year, the gross financing requirement is high, Nátrán said. The current financing requirement of the general government is near a historic low, expected to reach HUF 674 billion or 2.1% of GDP this year, he added.
He said the low net financing requirement could still be maintained next year, even after sectoral "crisis taxes" are phased out and the bank levy is reduced.
ADVERTISEMENT
KSH Dismisses Reports of Eurostat 'Investigation'
Hungarian-American Business Chamber Established in Chicago
SUPPORT THE BUDAPEST BUSINESS JOURNAL
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.
