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Hungary’s competitiveness worsened dramatically

Capital shortage is a weakness of the Hungarian economy and because of this grave problem the governing Fidesz party needs to have medium-term economic plans, the minister leading the Prime Minister's Office told a conference on European Union funds on Thursday.

In the current uncertain environment (elections in Europe, the Trump presidency in the United States) Hungary needs to fortify itself, but the strengthening of national sovereignty also means "more Europe" not less, János Lázár told a conference on EU funds on Thursday.
It is now possible to address not only Hungary's strengths but also its weaknesses, for political stability is greater, Lázár said.

  • The only natural ally for Germany in the weakening Europe is our region.
  • Capital shortage is a weakness of the Hungarian economy. This is a grave problem that we cannot resolve from own resources therefore we will be dependent on external funding in the next 25 to 30 years, and EU funding can offer only a partial solution.
  • Fidesz is expected to win the confidence of the people in the 2018 election, but also because of this it is its duty to have medium-term economic development plans, also in consideration of the serious capital shortage.
  • Hungary is struggling with a massive demography problem and even drastic interventions may not be able to help. However, migration is not the answer here, while the strengthening of the system of family supports may be.
  • The deteriorating demographic situation needs to be stopped, which firstly requires an overhaul of the health care system. This does not necessary mean a significant increase to available funding, rather the improvement of the health status of the population.
  • It is a serious disadvantage to economic development that the production model built on cheap labour no longer works. We cannot build on this and this is linked to the substantial wake hike the cabinet has decided recently. He argued that the ratio of working age population decreased considerably over the last few years due to low wages and migration to abroad. Labour will be more expensive but it would be even without the government's decisions.
  • It remains a question how Hungary could take part in the technological revolution.
  • Competitiveness data need to be watched closely. The situation is undoubtedly bad and the trend is clearly negative. This needs to be turned around, because Hungary's regional competitors are way ahead in this respect.
  • "Hungary's competitiveness worsened dramatically", that is part of the reason why faster growth is needed.

Source: portfolio.hu

Last Updated on Thursday, 24 November 2016 15:17

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