PM: No EU cohesion funds to be withdrawn from Hungary next year

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Prime Minister Viktor Orbán is confident that no European Union cohesion funds will be withdrawn from Hungary beginning on January 1, 2013.

Speaking from Brussels during a radio program on Friday morning, the prime minister said that although EcoFin, the council of EU finance ministers, is expected in the middle of March to initiate procedures aimed at suspending the disbursement of part of the cohesion funds allocated to Hungary next year in line with an earlier proposal from the European Commission, "everyone can take it for granted that not a single euro cent will be withdrawn from Hungary in January 2013".

Orbán emphasized that the European Union's excessive deficit procedure has been in place against Hungary since 2004, therefore, the country is now "suffering the consequences of the past".

 

Orbán said he considered the matter to be of a technical nature, adding that in Brussels "everyone recognizes the enormous efforts made by the country and the Hungarian numbers are good." The prime minister noted that this year and in 2013 only seven European Union member states will have a lower budget deficit than Hungary's and only a few member states including Hungary will be able to reduce their government debt these two years.

"It is impossible that even a euro cent should be taken away from a country in such a good position," the prime minister said.

Orbán said it is not going to be a challenging job for the government to reduce the deficit by 0.25% to less than 3% of GDP in line with the expectations of the European Commission, which forecasts a deficit of 3.25% for 2013, as the deficit at the time of the change of government in 2010 was 7.2%, which the government managed to cut to 4.2% by the end of that year.

The prime minister also said that the new EU fiscal pact, due to be signed by 25 out of 27 member states later on Friday, will help strengthen the euro, which is also Hungary's interest. Orbán emphasized though that Hungary would not have to adhere to the pact's rules until it joins the euro zone.

"Even the most optimistic forecasts see it unlikely that the country will be fit to join before 2018," the prime minister indicated.

Orbán said the pact will help strengthen the euro, and thus the state of the European economy, and will have a fundamental impact on Hungary's future as well.

 

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