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Decision to start reforms among highlights of 2006

Measures by decision makers to put Hungary on the path of reform were among the highlights of 2006, Finance Minister János Veres told MTI in a wrap up of the year.

As a result of the government's decision to start a stabilization program in June and Parliament's decision in August to support the program, a process has started in which results can already be seen in the area of reform, Veres said. Another of the year's highlights was the approval by EU finance ministers in October of the government's revised convergence program, Veres said. Also a highlight was Parliament's approval of the 2006 budget, which aims to support targets in the convergence program.

Market analysts and foreign investors have given the budget a positive - albeit with a slight delay - reception of the budget and some have offered and even more optimistic projections for 2007 than the government did, the Finance Minister noted. The 2006 general government deficit will probably be smaller than the government earlier expected, which marks a big success, Veres said. The ESA95 fiscal deficit will probably be under 10% of GDP, as compared to the earlier 10.1% of GDP projection, he said. This, together with the approved 2007 budget which is fully in line with the convergence program, and the launch of big reforms provide a good base to meet the targets for 2007, Veres said.

Implementing planned reforms and introducing related legislation will be one of the government's most important callings in 2007, Verse said. He noted that the government would provide Brussels as well as the public at the beginning of April with a strict assessment of the progress of reforms in the first quarter of the year. "I am entirely certain that we can send Brussels figures from the first quarter of 2007 which support that the Hungarian budget will remain within the approved limits in 2007, that the accrual-based general government deficit will be 6.8% of GDP," Veres said. Speaking about talks with employers and unions on wage rises, Veres said the government could only support realistic pay increases. (Mti-Eco)