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Finance Minister, Opposition Slam Matolcsy for Anti-Euro Opinion Piece

Péter Cseresnyés 2019.11.06.

Central bank head György Matolcsy recently published an article in the Financial Times arguing against the euro as a hopeless, damaging solution as the single European currency, also calling it a “strategic error.” His opinion has been the subject of much criticism. Beyond the politicians of the opposition parties, even the Finance Minister of the Orbán government, though indirectly, sent a strong message to him, advocating for the currency and its introduction in Hungary.

The leftist Democratic Coalition (DK) slammed Matolcsy’s article and called on Prime Minister Viktor Orbán to immediately initiate talks on introducing the common currency in Hungary.

Zsolt Gréczy, DK’s parliamentary group spokesman, said in a press conference that by writing the article, Matolcsy had proven himself “unfit to occupy any economic office.”

Introducing the euro is in Hungary’s national interest, Gréczy said, adding that “anything that goes against this is an open betrayal of Hungary’s national interest.” Only by introducing the Euro can Hungary prevent the further depreciation of wages and pensions, he said.

National Bank Governor in Financial Times: Euro a ‘Strategic Error’

Gréczy was not the only one to criticize the National Bank Governor’s words. Katalin Cseh, liberal Momentum’s MEP, wrote in a Facebook post: “It is not new that the government’s economic policy mouthpieces” were attacking the Euro and the eurozone.

“Perhaps only Matolcsy’s timing is worse than his faulty logic. He calls the Euro ‘a damaging and unproductive dream’ while the Euro has been fluctuating around 330 HUF for months, which is all but not useful and productive for the Hungarian economy,” the opposition politician added.

Cseh argued, even though the eurozone is not perfect, the introduction of the Euro would be the best choice for Hungary.

“It is in Hungary’s interest, as opposed to the friendship of Putin and Erdogan, to establish a stronger bond with Western Europe – and one of the most important components of this is the introduction of the Euro,” Katalin Cseh concluded.

MP Péter Ungár also commented on Matolcsy’s opinion piece on social media. According to green LMP’s politician, although the Hungarian government’s position on the common currency is “dishonest,” there are indeed arguments against the introduction of the Euro. It is also important to explain these “without taking it all in the direction of public hysteria.”

According to Ungár, “it is true that the Government’s position on joining the eurozone is dishonest because, contrary to Matolcsy’s statement, Mihály Varga always plans to join the eurozone at an unspecified date.”

But if the debate of the euro was reduced to only attacks on the government, the politician added, then a great disservice is being done to Hungary.

The most surprising reaction Matolcsy’s article has triggered, however, was not from an opposition politician, but the Minister of Finance.

After yesterday’s meeting of the Competitiveness Council, the business portal mfor.hu asked Mihály Varga about his opinion on the single European currency, and he took a greatly different stance from that of the Governor of the NBH.

Matolcsy Disputes Varga’s Notion that “Golden Age” of Hungarian Economy is Over

The Euro is one of the EU’s most promising but unfinished initiatives, Varga said. He also reiterated that Hungary has committed itself to introduce the currency at the time of our accession to the EU. He said that he saw institutional problems in the eurozone, but made it clear that the government envisions Hungary in this monetary framework, and not in another.

At the same time, he confirmed that there is no target date for the introduction, but his words revealed that the government has not given up on the launch of the Euro.

It is difficult to interpret Varga’s statement other than as a strong message to Matolcsy. The two economists have recently contradicted each other several times.

Featured photo by Lajos Soós/MTI