Hungary’s government has unveiled a four-year economic and budgetary plan aimed at accelerating growth, cutting the budget deficit and preparing the country for eurozone membership by 2030. The Finance Ministry expects economic growth to pick up gradually, reaching 3.1% by the end of the decade, while promising to rein in wasteful public spending.
Government targets deficit reduction and eurozone readiness
The Finance Ministry published its medium-term economic and budgetary programme on Wednesday morning, setting out the government’s plans for the 2027–2030 period.
According to the document, the government is committed to responsible and sustainable fiscal policy. Its first major target is to bring the budget deficit below 5% of GDP in 2027, followed by establishing the conditions necessary for Hungary to join the eurozone by 2030.
The government says deficit reduction is essential to restoring stability and intends to achieve it primarily by cutting wasteful and overpriced operating expenditure across the state sector.
It also plans to replace corporate subsidies deemed inefficient with targeted programmes financed by EU funds. The government expects this approach to deliver budgetary savings while reducing incentives for rent-seeking and supporting a new growth model based on productivity.
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Economic growth expected to accelerate by 2030
The programme broadly matches the figures presented last week by Finance Minister András Kármán at a joint press conference with Prime Minister Péter Magyar.
The government forecasts that Hungary’s GDP will grow by 1.7% in 2026 before accelerating over the following years, reaching 3.1% in 2030.
Inflation is expected to rise from a forecast 1.7% this year to 3% in 2027, before easing to 2.5% in each of the following three years.
The ministry’s projections are somewhat more cautious than market consensus and slightly below the National Bank of Hungary’s earlier growth forecasts.
In its September inflation report, published before the budget plans were presented, the central bank forecast GDP growth of 2.9% in 2027 and 2.8% in 2028. It also projected inflation of 3.1% in 2027 and 2.6% in 2028.
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Why Hungary needs a new growth model
According to Telex, the government argues that the economic model that powered Hungary’s rapid growth during the 2010s has run out of steam.
Growth during that decade relied heavily on bringing more workers and capital into production. By the 2020s, however, the pool of readily available labour had dwindled and investment had weakened. As a result, productivity growth has lagged significantly behind that of regional competitors since 2010.
Between 2015 and 2025, Hungary’s annual economic growth was more than one percentage point lower on average than Poland’s, according to the programme. The document attributes this entire gap to weaker domestic productivity growth.
It also identifies an uneven competitive environment and incentives for rent-seeking as factors that have undermined the efficient use of resources. Capital and other resources have not consistently flowed towards the most productive sectors and businesses.
Public spending is another area the government wants to reform. According to the ministry, running the state costs the equivalent of 1–1.7 percentage points of GDP more than in neighbouring countries in the region. State intervention in the economy also accounts for around three percentage points of GDP more than the regional benchmark.
At the same time, areas considered important for long-term growth, including social protection and healthcare, have been underfunded, the document argues.
Investment and exports expected to play a bigger role
Household consumption has been the main driver of economic growth in recent years. The government expects investment and exports to make a more substantial contribution from 2027 onwards.
EU funding is expected to support a recovery in investment, while fairer market competition and structural reforms should improve the productivity of Hungarian businesses.
The government’s strategy therefore aims to shift the economy away from a model driven primarily by expanding the workforce and consumption towards one in which productivity, investment and exports play a greater role.
Whether these targets can be achieved will depend on the pace of the planned reforms, the recovery in investment and the availability of EU funding. The programme sets out the government’s intended direction, rather than guaranteeing that Hungary will meet its 2030 eurozone objective.
