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Hungary parked two decades its entry into the euro
BUDAPEST (Reuters) - Hungary should avoid the euro, hit by the crisis, for two decades to strengthen its economy and self-employment, the economy minister said in a column published on Thursday in a magazine.
The largest debtor nation in Central Europe, which is expected to resume talks with the International Monetary Fund and the European Union next month on a financing agreement, only meets one of the criteria to enter the euro at a time when other Eastern European countries have postponed their ambitions to join the single currency.
After failing a series of installments under a series of different governments, Budapest had recently raised 2020 as a potential date access to the euro.
"The euro zone is facing a prolonged economic and financial crisis because he tried to do too much and get too high," said Gyorgy Matolcsy, architect of the economic program that has irked some in the banking industry and pension and sparked protests from the outside in his regular column in the weekly Heti Válasz.
"The Hungarian policy may follow a multi-step strategy to strengthen the economy without the euro over the next two decades of war and enter the euro zone after a new peace."
While all EU members of this promised when they joined to adopt the euro, are not required to give a firm date and Poland and the Czech Republic have delayed this ambition.
Estonia and Slovakia have joined the single currency and Lithuania and Latvia could try to join if the debt crisis subsides, and problems also raised the question of whether monetary union could incorporate easily the largest economies of the region.
After a fiscal surplus in 2011, which is unusual, Hungary - which has 10 million inhabitants - is targeting a budget deficit of 2.6 percent of gross domestic product this year, one of the lowest in the EU thanks to a combination of tax increases and expenditure side reforms.
The EU is pressing the government to maintain a low budget deficit but Budapest has rejected the painful austerity measures being implemented in other European countries and ruled out cuts in family benefits and pensions.
Source: Reuters August 30, 2012
