Market Would Accept 2024 Deficit of 4-4.5% of GDP - Varga

Analysis

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Finance Minister Mihály Varga said the government was weighing bringing the general government deficit under the 3%-of-GDP Maastricht threshold in two years, instead of one, and added that the market would accept a 4-4.5% deficit this year, speaking at a conference on Saturday.

Varga told the iCon economic policy conference in Sopron that the two-year timeframe would be "more realistic", adding that the government still hadn't taken a decision on the matter.

He said the 2023 deficit was around 6% of GDP. Bringing the gap under 3% could be achieved in 2024, but only to the detriment of economic growth which would result in an increase in unemployment, he added.

Varga said the government continued to aim to bring the personal income tax rate into the single digits, but added that the 15% rate at present was "not bad" and was the third-lowest in Europe.

Fielding questions, Varga said adopting the euro was "not a goal, but a means", adding that Slovakia's accession to the eurozone had not made the country's economy any more successful.

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