Weekly newsletter

The EU Wants to Interfere in the Hungarian Budget, Minister Says

Hungary Today 2023.09.18.

Although the war and sanctions crisis is putting extraordinary strain on budgets, deficits and public debt are being steadily reduced, as confirmed by the latest decisions of rating agencies, Mihály Varga said at a meeting of EU finance ministers (ECOFIN) in Santiago de Compostela, Spain.

The minister stressed that the European Commission would interfere even more in the fiscal policies of Member States and will therefore now further increase its powers.

He said that

Hungary rejects proposals that would undermine the sovereignty of nation states. Nor does the government agree that the European Commission should expand its powers, he argued.

The minister explained that after a pandemic and on the brink of war, the European Union must respond to the challenges of high debt and budget deficits. All Member States agree on that, but not on the way they should do it, he noted.

The politician added that

it is unacceptable that Brussels wants to dictate itself how Member States should reduce their budget deficits within the framework of economic governance.

According to Mihály Varga, this approach resembles the situation when austerity was imposed on Hungary in 2009. He stressed that the budgets of individual Member States should be determined by national governments in the national interest, not by Brussels bureaucrats and the deals they make with them. The minister said the government agrees with disciplined management but rejects austerity measures, and the budget for next year is prepared accordingly.

The war and sanctions crisis, the withholding of EU funds, and the rising costs of border protection are putting an extraordinary strain on the budget, but the Hungarian government is reducing the budget deficit and public debt year by year, Varga said. This is also recognized by the credit rating agencies: In its latest report, Moody’s rated the government’s commitment to improving balance sheet indicators and the sustainability of the reduction in the debt-to-GDP ratio as positive, he emphasized.

Hungary’s budget is growing beyond its means to provide the resources needed for the country’s security and border protection. Defense spending stands at 2 percent of GDP, while spending on border protection has exceeded HUF 650 billion (EUR 1.7 million) since 2015,

Varga wrote in a Facebook post Saturday morning.

The finance minister stressed that it would be fair if EU rules did not consider defense spending as part of the Maastricht deficit in this exceptional situation. He announced he had also presented Hungary’s position at the meeting of EU finance ministers.

Positive Rating from Moody's Confirms a Stable Outlook
Positive Rating from Moody's Confirms a Stable Outlook

The rating agency expects the Hungarian economy to grow by three percent in 2024.Continue reading

Via Ungarn Heute, Featured Image: Pixabay

    [1536x1536] => Array
            [width] => 1536
            [height] => 1536
            [crop] => 

    [2048x2048] => Array
            [width] => 2048
            [height] => 2048
            [crop] =>