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Hungary budget sleight may flop

Eurostat, the official statistics office of the European Union, will probably reject Hungary’s attempt to remove the cost of motorway construction from the budget, while using motorway loans to prop it up, in an effort to meet its 4.7% deficit target, business daily Világgazdaság reported. Hungary is hoping to use Ft 178 billion to Ft 300 billion from motorway income and loans to reduce the budget deficit by 0.8%-1.3%. If Eurostat decides that this goes against the EU’s ESA 95 accounting rule, Hungary's year-end budget gap will come in at 5.5% or even 6% of its GDP, according to the paper’s estimates. Moreover, noted the paper, it will also likely to affect th deficit numbers of the past two years making it practically impossible for Hungary to meet its self-imposed 2010 euro zone entry target.