Hungarian minister made it clear when Hungary could introduce the euro
Márton Nagy, Hungary’s economic development minister, said that 2022 was the hardest year after the fall of communism (1990). Energy import jumped to 10 percent of the country’s GDP last year, but Hungary may evade recession in 2023, and by the end of 2023, inflation will be one-digit again.
EURO introduction not far?
The minister said that in 2024, the GDP growth would be around 4 percent again. He highlighted that food prices would peak this February-March, just like the inflation, which will reach 25 percent in January. However, from March, a drastic price decrease might start in the food sector. Afterwards, the government will cease the food price cap scheme.
Mr Nagy said that Hungary could start talking about introducing the euro when the GDP per capita at purchasing power parity reaches 90 percent of the European average. That stood at 79 percent last year, preceding Portugal and Greece, Magyar Nemzet wrote.
Jobless rate in Hungary up
Hungary’s jobless rate was 3.9 percent in December, up from 3.8 percent in the previous month, the Central Statistical Office (KSH) said on Friday.
The rate covers unemployment among people between the ages of 15 and 74. In absolute terms, there were 189,600 unemployed, 3,100 more than a month earlier and 10,700 more than at the end of 2021. The employment rate in Hungary in December was 74.4 percent, 1.3 percentage points higher than a year ago, the KSH said.
The number of employed aged 15-74 in December came to 4,704,000, up 17,000 from the previous year. In the full year of 2022, the number of employed increased by 61,000 to 4.696 million. Commenting on the data, the economy development ministry said the jobless rate have been improving for 7 consecutive months, with the number of jobholders hitting a “record” in December. Youth unemployment fell especially steeply, from 13.5 percent to 10.6 percent, they said.
Labour market tendencies have vindicated government measures targeted to preserve full employment and to protect families, the statement said. Crisis resistance and competitiveness will have to be boosted further in 2023 to avoid a recession and preserve full employment, the ministry said. The government is launching a 700 billion forint credit line to fund companies amid “impossibly” high interest rates, the statement added.
Read alsoDrastic change in Hungary’s property market
Source: Magyar Nemzet, MTI
4 Comments
Typical jibberish. The article headline says that the article will state when the Euro can be introduced in Hungary. Of course it doesn’t state this at all because Hungary is so far from reaching the criteria for conversion that it could be many years before it’s even possible.
Why don’t “reporters” do a little work?
https://www.consilium.europa.eu/en/policies/joining-the-euro-area/convergence-criteria/
Gazdasági konvergenciakritériumok
Az euróövezeti csatlakozás gazdasági kritériumai azt hivatottak biztosítani, hogy egy ország képes legyen beilleszkedni az euróövezet monetáris rendszerébe.
Négy gazdasági konvergenciakritérium létezik:
1. Árstabilitás
Az inflációs ráta legfeljebb 1,5 százalékponttal haladhatja meg a három legjobb teljesítményt nyújtó tagállam inflációs rátáját.
2. Rendezett és fenntartható államháztartás
Az ország nem állhat túlzotthiány-eljárás alatt.
A túlzott hiány esetén követendő eljárás (Európai Bizottság)
3. Árfolyam-stabilitás
A tagállamnak legalább két éven keresztül részt kell vennie az árfolyam-mechanizmusban (ERM II) anélkül, hogy pénznemének árfolyama erőteljesen eltérne az ERM II-ben alkalmazott középárfolyamtól, továbbá hogy pénznemének az euróval szembeni középárfolyamát ugyanebben az időszakban lejjebb szállítaná.
4. Hosszú lejáratú kamatlábak
A hosszú lejáratú kamatláb legfeljebb 2 százalékponttal haladhatja meg az árstabilitás szempontjából három legjobb teljesítményt nyújtó tagállam kamatlábát.
Jogi konvergencia
Az euróövezethez csatlakozni kívánó tagállamoknak biztosítaniuk kell azt is, hogy nemzeti jogszabályaik összhangban álljanak a Szerződésekkel, továbbá a Központi Bankok Európai Rendszere (KBER) és az Európai Központi Bank (EKB) alapokmányával.
A Szerződések és az alapokmány előírják a központi bankok függetlenségét.
or
Economic convergence criteria
The economic conditions for joining the euro area help to ensure that a country is ready for integration into the monetary regime of the euro area.
There are four economic convergence criteria.
1. Price stability
The inflation rate cannot be higher than 1.5 percentage points above the rate of the three best-performing member states.
2. Sound and sustainable public finances
The country should not be under the excessive deficit procedure.
Excessive deficit procedure (European Commission)
3. Exchange-rate stability
The country has to participate in the Exchange Rate Mechanism (ERM II) for at least two years, without strong deviations from the ERM II central rate and without devaluing its currency’s bilateral central rate against the euro in the same period.
4. Long-term interest rates
The long-term interest rate should not be higher than two percentage points above the rate of the three best-performing member states in terms of price stability.
Legal convergence
Candidates to join the euro area must also ensure that national legislation is compatible with the Treaty and the Statute of the European System of Central Banks (ESCB) and the European Central Bank (ECB).
The Treaty and Statute provide for the independence of central banks.
Dear János, thank you for your remark. The author of our article clearly states the following: “Mr Nagy said that Hungary could start talking about introducing the euro when the GDP per capita at purchasing power parity reaches 90 percent of the European average.” Thank you for reading us.
Dear Mercedesz,
I also expected a date estimation. Did Mr. Nagy said when Hungary is expecting to reach this 90% GDP milestone ?
Thank you for listening to your readers.
Dear FV, unfortunately, this is all the information we know so far. As soon as we know more, we will let our readers know. Thank you for reading us!