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Fidesz sees recession continuing

Hungary’s top opposition party Fidesz does not believe the government’s forecasts and expects sluggish growth to continue, the side’s economy expert Mihály Varga told Bloomberg.

Therefore, upon being elected to govern, Fidesz will be moving to extend and renegotiate the rescue loan made available to Hungary by the International Monetary Fund.

He pointed out that the continuing recession, mounting debt and an unrealistic deficit target will provide the next government with very limited room to operate in order to set Hungary on a growth trajectory.

He said he expects Hungary’s economic progress will be characterized by a “W” curve, which makes the government’s 3.8% of GDP deficit target impossible, Fidesz instead expects the gap to come in at 7.5% of GDP. He added that Fidesz would not deliberately let the deficit soar but it also takes into consideration that the IMF does not.

The fund has already warned Fidesz that it would not tolerate the 2010 deficit surpassing 7%. (Gazdasági Rádió)