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Varga puts 2021 GDP growth at 7-7.5%

Analysis

Finance Minister Mihaáy Varga said Hungary's GDP growth could reach 7-7.5% this year, addressing an annual meeting of economists in Budapest on Friday, according to news agency MTI.

Hungary's economy has reached pre-pandemic levels of performance and the pace of growth is expected to continue in the coming period, Varga said. He noted that the economies of just nine European Union member states had recovered to their states before the coronavirus crisis.

Varga said Hungary's 7.5%-of-GDP general government deficit target for this year is "average" compared to other EU member states. He added that government measures to jump-start the economy are supporting businesses and families to the tune of more than HUF 13 trillion in 2021 and 2022.

Credit rating agencies have acknowledged Hungary's performance and the government's economic policy, he said, adding that positive feedback is expected from Moody's at a scheduled review late on Friday.

He said government spending must be "restrained" and efforts made to put state debt, relative to GDP, on a continuous decline. Keeping fiscal policy "on the golden middle way" should be "among the top goals" in the coming period, he added.

He said debates over Hungary's EU funding are "cooling down" and expressed hope an agreement on the issue would be reached.

Varga said digitalization must be placed among the government's top three policy priorities. He added that the development of digital skills, the digitalization of public administration and the healthcare sector, and the expansion of digital tools must be accelerated.

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