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May 16, 2019

Hungary's GDP growth highest in the EU

Hungary’s Q1 GDP growth is the highest in the EU, out of the 20 member states who have submitted their figures so far

Hungarian economic growth in the first quarter of the year reached a 19-year record of a seasonally and working day-adjusted 5.2 percent, putting it at the top of the 20 EU member states who have reported their data so far.

According to Magyar Nemzet, out of the eight countries that have yet to publish their figures, only Malta could conceivably post a higher growth figure.

Mihály Varga, Minister of Finance, said the Hungarian economy’s performance was more than three times higher than the EU average of 1.5 percent.

The main driving forces behind the growth were the rise in investments, jobs and exports. Varga added that since the turn of the millennium Hungary only had such strong growth in the first quarter of the year 2000, but that growth was coupled with a significant rise in public debt.

“This time the situation is quite different: state debt has continuously been falling in the past eight years and the budget deficit is modest, which means that this growth is based on a different economic structure,” Minister Varga said.

The government’s GDP growth target for this year is around four percent, but in light of the first quarter data Takarékbank analyst Gergely Suppan now forecasts a 4-7 percent growth for the year.

Minister Varga also said that in early June the cabinet will present to Parliament its 2020 budget draft. It will contain an even higher reserve than this year’s HUF 300 billion (EUR 924 million) so that the government can offset any downturn in the European or global economy.

Photo credit: origo.hu