The Fiscal Council said the government’s 2025 budget draft was “credible” and “feasible”, while highlighting some risks, in an opinion issued on Thursday.
Fiscal Council about the so-called peace budget
The Council said the 3.4pc GDP growth assumed in the budget draft was achievable, but pointed to risks posed by the war in Ukraine and European sanctions. Lower than anticipated growth could put the 3.7pc-of-GDP general government deficit target at risk as budget revenue underperforms, it added.
The Council said the targeted reduction in state debt to 72.6pc by end-2025 from 73.2pc at the end of 2024 was “realistic”, but noted that sensitivity to exchange rate risk had increased as the ratio of FX debt approached 30pc.
In a separate statement, the Finance Ministry acknowledged the Council’s opinion and said the 2025 budget bill would be submitted to lawmakers on Monday.
Photo: FB/Mihály Varga
The Hungarian parliament accepted the annual budget almost a year before in the last 14 years. That means the 2024 budget was accepted in 2023 May. The only exception was 2025 when the Orbán cabinet said they would only submit the budget after the American presidential elections. That is because the Orbán cabinet believes only Trump can bring peace to Eastern Europe, so a peace budget can only be drafted if he is the president starting next January.
Finance Minister Mihály Varga addressed the Figyelő Top 200 gala
Finance Minister Mihály Varga addressed the Figyelo Top 200 gala in Budapest late Thursday. Varga said the performance of the country’s business sector had been “impressive”, adding that the annual revenue threshold for inclusion on the Figyelo Top 200 list had climbed to HUF 90bn from HUF 35bn ten years earlier. He added that Hungary’s economic success was supported by the government’s policy of cooperation in the domestic economy and connectivity on external markets.
He said the government’s Eastern Opening policy had brought record FDI to the country. Assessing the results of the United States elections, Varga said Donald Trump’s victory could advance international processes supporting peace, limiting migration and improving the appraisal of national sovereignty. He added that improved relations between Hungary and the US could pave the way for the reinstatement of the double taxation avoidance agreement between the countries that was unilaterally terminated by the Democratic Party administration.
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