Mihály Varga: From 2025, the economy can be on a higher growth path

By: Trademagazin Date: 2024. 11. 07. 11:21

After four difficult years, starting from 2025 next year, the Hungarian economy can return to the growth rate of the pre-pandemic period, for which a disciplined fiscal policy provides an adequate basis, said Finance Minister Mihály Varga on Thursday in Budapest, at the 25-year-old Figyelő Top 200 gala.

The head of the department explained: in the draft budget to be submitted to the Parliament on Monday, they expect a deficit target of 3.7 percent, after this year’s 4.5 percent and last year’s 6.7 percent.

The measures already announced in the government’s new economic action plan serve to improve competitiveness and export capacity, as well as to dynamize investments. The Sándor Demján program, which also helps to get the workers’ loan and small and medium-sized enterprises (SMEs) in a good position, and the ongoing three-year wage agreement negotiations can result in an increase in purchasing power and an expansion of consumption, he said.

In the draft budget, the government plans to increase GDP by 3.4 percent next year, which may approach the upper limit of the 3-6 percent band if external conditions are favorable. The further expansion of domestic demand is also supported by real wages, which have been rising for a year, by almost ten percent – explained the head of the ministry.

Mihály Varga indicated that no profound changes in taxation rules are expected next year.

In this regard, he noted: in terms of tax competitiveness, the Hungarian economy ranks seventh in the ranking of the Washington Tax Foundation.

The Minister of Finance called the recent performance of the business sector “impressive”. He noted: ten years ago, to be included in the Figyelő Top 200 list, a sales revenue of HUF 35 billion was needed, which has now increased to HUF 90 billion, and this is also a 50 percent increase in real terms.