Márton Nagy, National Economy Minister, said a new economic order was taking shape in the world, in which Europe needed to preserve its independence. To achieve that, he said Europe needed to boost its competitiveness, step up its innovative performance and accelerate the green transition and the application of artificial intelligence.
Minister Nagy made the remarks as he addressed an event organized by the World Economic Forum (WEF), entitled High-Level Dialogue on Europe in the Age of Intelligent Economics, in Geneva on Monday.
While Asian economies, especially China, and the United States quickly adapt to new challenges and support their own economies with all means, he said, noting Americans' Inflation Reduction Act, the European Union has fallen behind in new branches of industry and has been slow to react to new trends. He added that joint action was necessary as the EU's competitiveness deteriorated at an unprecedented pace.
Not only has the EU failed to take steps to address the matter, some of its measures have contributed to the formation of blocs and could pave the way for an "economic cold war", he said, pointing to the EU decision to levy punitive tariffs on EVs manufactured in China. He added that five member states -- Germany, Hungary, Slovakia, Slovenia and Malta -- had voted against the measure, while just ten had supported it.
He warned that the punitive tariffs would be a "calamity" for the European automotive industry, especially vehicle manufacturing in Germany, and could result in retaliatory measures. He urged caution on the matter and said negotiations needed to continue with the aim of reaching a mutually beneficial agreement.
Hungary seeks cooperation, based on mutual respect, with all sides, and takes its own decisions on economic partners, Nagy said. That principle is embodied in the policy of economic neutrality, a policy that establishes the conditions for accelerated economic growth, he added.
He said that policy extended to neutrality in financing, investments, markets, energy and technology. As a small, open economy, Hungary is committed to connectivity and wants to strengthen further its role as a "meeting point" for capital and technology from the East and the West, he added.
If EU member states want to boost their competitiveness, they need to be prepared to run up higher budget deficits, temporarily, he said. He added that those bigger fiscal gaps wouldn't result in imbalances, as the goal was to boost economic growth and strengthen competitiveness.