Economic indicators point to growth

A conservative analyst who used to be critical of Hungary’s “unorthodox” economic policies, now admits that they seem to have proved efficient in creating favourable conditions for GDP growth.

In Magyar Hírlap, Csaba Szajlai who has often been quoted in BudaPost as an outspoken critic of the economic policies followed by the government since 2010, now argues that they will yield positive results. He acknowledges that poverty is still a grave problem in Eastern Hungary, but believes that the solution offered by the government in the form of community work instead of mere subsidies has been an improvement on previous years. The long term solution will come from sustainable growth, he continues, and quotes the European Commission and the IMF as being optimistic about Hungary’s growth prospects. Hungary’s attractiveness for investors depends on whether it will keep deficits and inflation low, while reducing public debt and growing at a steady rate, Szajlai explains, and remarks that by now serious market actors and the European Commission itself agree that the Hungarian economy will grow faster than the European average; the balance of payments will remain positive and public deficit will be keptunder the 3 per cent threshold. What Szajlai believes should be done in the future is a structural tax reform with fewer special taxes on individual business sectors and lower tax rates.

Tags: economy, unorthodoxy