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Hungary to cut public debt by 4 percentage points

Hungary's government will cut the country's sovereign debt in a single move by over HUF 1,340 billion, reducing it to 77% from 81% of GDP, Prime Minister Viktor Orbán said.

The decision heralds a new era of steady and lasting national debt reduction, Orbán said. Hungary has reached a milestone, he added.

Orbán said on radio early Tuesday that the government is drawing up legislation for a roadmap to bring government debt down to under 50% of GDP.

The debt will be reduced by transferring assets from private pension funds.

Hungarian members of private pension funds had until the end of January to opt out of the private pension fund scheme, along with their retirement savings, and return to the state scheme, or face losing their state pension. About 97% decide to go back, bringing some HUF 2,946 billion in assets with them.