Emergency alert off

According to a forecast by GKI Gazdaságkutató Zrt. and Erste Bank, production will grow the most this year in those sectors which sell their products or services to foreign markets. Turnover in domestic-oriented sectors such as building and construction or retail will keep declining. For the whole year a 1-percent growth is expected, with the budget deficit staying below 4 percent. As a result of official communication predicting economic emergency, international trust in the Hungarian economy was shaken. The government’s action plan was announced early June, but the feasibility of some of the 29 measures is questionable.
For instance it seems unrealistic to collect HUF 200 billion – half of their annual profits – from financial institutions each year. Our external balance was plus EUR 0.8 billion in the first quarter and Hungary’s net foreign debt decreased from EUR 52 billion to 48 billion in 2010.