News in brief
Film act amendment to change financing mechanism
Under the proposal of the government’s draft amendment to Hungary’s cinematography act, four-fifths of the tax revenues of a state lottery would be contributed to Hungary’s Film Fund, which would ensure an effective contribution to the prosperity of Hungarian film. Special attention would be paid to art cinemas. The proposal also seeks the establishment of a Film Artist of the Nation title to replace the current Master of Hungarian Film.
the HUF/EUR exchange rate after Greek PM George Papandreou announced his country would hold a referendum on a €130 billion ($178 billion) bailout package.
HUF 200-300 billion
the amount Hungarian banks will lose under the law allowing the early repayment of foreign-currency mortgages at below market rates, said György Surányi, the head of Intesa Sanpaolo SpA’s CIB Bank unit in Hungary.
Government calculations estimate that 10-15% of the borrowers of foreign currency denominated loans will take advantage of the option of early full repayment at a discounted exchange rate, affecting loans worth a combined HUF 500 billion-750 billion, National Economy Minister György Matolcsy said.
Companies net repayers in forints, net borrowers in FX in Sept
Hungarian non-financial corporations were net repayers in forints but net borrowers in foreign currency in September, according to the aggregated balance sheet of credit institutions published on Friday by the National Bank of Hungary (MNB). Banks’ stock of forint corporate loans, excluding revaluations and other changes, fell by HUF 39.2 billion, while their foreign currency loans rose by HUF 25.8 billion in September from the previous month. Including the effect of HUF 291.9 billion in revaluations and other changes, forex loan stock reached HUF 4.38 trillion at the end of September.
Hungary speeds up drawdown of EU money, says minister
The pace at which European Union funding is paid out in Hungary has picked up, but it must accelerate further if all of the available resources are to be used up, National Development Minister Tamás Fellegi said at a conference. An average HUF 35.1 billion of EU funding is paid out each week at present, up from HUF 5.5 billion earlier, Fellegi said at the conference organized by the National Development Agency, the Hungarian Economic Development Center and the European Commission. The number of contracts signed each week has climbed to 174 from 103, he added. In the past year, 2,697 contracts involving some HUF 93 billion in funding have been signed, Fellegi said.
Proposal submitted for new 27% payroll tax
Fidesz MP Antal Rogán has submitted a motion for a new 27% payroll tax, in an amendment proposal submitted to next year’s tax laws. The proposal says the new tax is to replace the health insurance contribution, the labor market contribution and the pension contribution paid by employers. Under a previously submitted amendment proposal to the social security act, it would become possible to establish payment obligations due to the social security funds that do not generate entitlements to social security services, breaking the link between payments in and out of the social insurance system. A second proposal would set the minimum wage as the basis for the pension contribution, and the basis for the health insurance and labor market contribution would be 150% of the minimum wage.
Fidesz retains strong lead, many voters undecided
The ruling Fidesz-Christian Democratic alliance has maintained its massive lead among voters, while 50% of respondents in a recent poll conducted by pollster Tárki said they could not choose a party or would not disclose their preferences. Tárki said Fidesz and its ally enjoyed 23% support among all respondents (1 percentage point down from September) and 46% among decided voters (4 points down). Support for the opposition Socialist party has remained virtually unchanged: it rose one percentage point to 11% across the whole sample and from 21% to 22% in the decided group. 10% of the whole population and 20% of decided voters voiced preferences for the radical nationalist Jobbik party – the ratios having remained virtually unchanged from September. The green opposition LMP enjoys support from 5% of the whole sample (2 points up) and would garner 10% of the votes from decided voters (3 points up) if elections were to be held this weekend.
Hungary the loser of the crisis
Hungary has lost most in the world economic crisis, while Poland has pulled through quite well, a survey published in the Washington Post and conducted by economists Ignacio Munyo and Ernesto Talvi of the Center for the Study of Economic and Social Affairs showed. The two economists compiled an “economic exuberance index”, based on output, unemployment, domestic demand, bank credit, inflation and the real exchange rate. Hungary has been a loser in all the studied aspects, the survey showed, adding that Argentina, Angola and Brazil have won most from the crisis. Previously, a survey conducted by Germany’s Deka Bank also found that Hungary was the country that lost the most in the crisis when compiling GDP trends, online news portal Index reported.
Hungarians inclined to save more than neighbors
About 58% of Hungarians think making savings is “very important” and 25% think it is “important”, a survey by Erste Group shows. The figures are the highest in the survey of five countries in the region: Austria, Czech Republic, Hungary, Slovakia and Ukraine. Although 82% of Hungarians say they save when possible, just 43% put money away regularly, the survey shows. The average monthly savings in Hungary is HUF 14,705. The most popular investments are cash savings and life insurance.
Govt to establish free zones for businesses in disadvantaged areas
Hungary’s government is establishing free zones for businesses in the country’s most disadvantaged areas, National Economy Minister György Matolcsy said in Parliament, presenting the 2012 budget bill. Businesses operating in the free zones would provide work for local residents, Matolcsy added.
Govt to propose bill on new bank regulation
A bill that aims to establish new regulations for Hungary’s banking system will soon come before Parliament, Prime Minister Viktor Orbán said in a statement after an EU summit. Recent events show that something has gone wrong with the European banking system, Orbán said, in a statement published on his Facebook page. Financial institutions cannot turn to the people of Europe for help every three years, thus the regulatory framework in which they operate must be renewed, he said. This work is ongoing in Hungary, and a bill on banking system regulation will soon be submitted to Parliament, Orbán added.
Gov’t to promote childbirth
The Rural Development Ministry will launch a program to lease farmland under favorable conditions to young couples with plans to have children from early next year, Napi Gazdaság wrote. Under the scheme couples committing to raise children and do farming can apply for a 50-year-long lease of land at the National Land Fund Management Organization (NFA). NFA has so far marked 5,000 hectares of state-owned land to be included in the scheme. Families owning land already could apply to increase its size to 300 hectares, a maximum a private individual is permitted to own under Hungarian laws, if they make a commitment to raising a family.
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