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Veres: Hungary sticks to 2.6% deficit target

Hungary is sticking with its 2009 target of a budget deficit of 2.6% of gross domestic product even as a deepening recession slashes revenue, Finance Minister János Veres said.

The government will make budget cuts to meet the deficit goal, Veres said. The government will decide on measures to curb spending on February 15 and announce them the following day in Parliament, Veres said. “We would like to meet the 2.6% budget-deficit target under all circumstances,” Veres said. “The lost revenue due to the worse-than-expected growth prospects needs to be compensated with cost-cutting measures.”

Hungary needs to keep down its deficit as it seeks to adopt the euro. The country hasn’t set a deadline for the changeover. The deficit limit to adopt the European common currency is 3% of GDP. Veres reiterated the country will seek to start talks to join the exchange-rate mechanism, a pre-euro framework of currency stability, later this year. (MTI-Econews)