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Municipalities in terrible debt

The debt of municipalities reaches up to HUF 1100 billion and is still likely to increase until 2012-2013 due to formerly issued foreign currency bonds, the Interior Ministry told business daily Napi Gazdaság.

The debt can cause serious problems for county municipalities. The government plans to introduce a proposal on a new municipality system early next year. The new concept would make taking out a loan much easier. After that, issuing bonds would not be the only solution in time of urgent financial problems.