European Commission: Hungarian economic performance expected to exceed EU average this year
EnglishAs a result of the measures taken by the government to protect the economy and promote a restart, Hungary may be able to overcome the crisis caused by the coronavirus epidemic sooner than the EU average, Finance Minister Mihály Varga told MTI after an online meeting of EU finance ministers (Ecofin).
The statement of the Finance Ministry quoted the minister as saying that
according to the latest forecast of the European Commission, Hungary will achieve the seventh highest growth in the European Union this year.
According to the Commission's latest economic forecast for 2021, economic growth is expected to be 3.7 percent for the whole of the EU, while Hungary's GDP growth could be as high as 4 percent.
Regarding the Recovery and Resilience Facility (RRF) aiming to alleviate the consequences of the coronavirus crisis, Mihály Varga explained that in order to access the funds available through this facility, Hungary has already prepared a draft Recovery and Resilience Plan (RRP). The Finance Minister added that there are a number of administrative obstacles member states have to overcome in the course of drafting their RRP plans, so it is important that the approval process of the national programs by the EU should be as transparent and fast as possible so that the funds can provide real help.
According to the statement, given the uncertainty caused by the current epidemic, the future of the EU fiscal policy will also be an important consideration in supporting the recovery. Member states agree that
returning to previous EU fiscal rules will only be possible when the average GDP growth in the EU returns to pre-crisis levels.
Therefore, the application of the so-called general exemption clause may be justified in 2022 as well, Mihály Varga added.
The finance ministers discussed the progress of international initiatives aiming to tax the digital economy, in which the Hungarian position remains unchanged. On the one hand, Hungary supports G20 efforts to work out a global solution to the issue by mid-2021, as long as it is based on a broad compromise and avoids double taxation. On the other hand, Hungary continues to reject international solutions that would restrict fair tax competition, the minister emphasized.
