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Aug 26, 2020

Government expects the economy to start recovering next year

Around HUF 500 billion (EUR 1.4bn) will be spent on measures to protect the economy in the second half of the year.

The Hungarian government expects the economy to start recovering next year, with growth of above 4 percent and a budget deficit below 3 percent.

State Secretary Péter Benő Banai told Kossuth Rádió that whereas the budget deficit is likely to be 7-9 percent of GDP this year on the back of additional spending on protection measures, a gradual turnaround is probable in 2021, Around HUF 500 billion (EUR 1.4bn) will be spent on measures to protect the economy in the second half of the year.

The state secretary said Hungary’s economic prospects are largely tied to European developments. As yet, the 2021 budget is uncertain, and much depends on the course of the coronavirus in the country and the epidemiological situation in export markets. The government is monitoring these developments closely and is ready to respond accordingly, he added. 

Finally, he noted that Hungary is the only EU country that has reduced its public debt as a share of GDP every year since 2011, so it is well placed to handle temporarily higher deficits.

Photo credit: Századvég