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EBRD raises Hungary 2018 GDP growth forecast to 3.8 pc
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The European Bank for Reconstruction and Development (EBRD) has raised its forecast for Hungary’s GDP growth this year to 3.8 percent, up from its previous projection of 3.4 percent published in November.
The new forecast is below the government’s projection of 4.3 percent growth.
In a report on regional economic prospects, the EBRD noted investment growth in Hungary last year, at 16.8 percent, was the second-highest in the European Union. The bank attributed the increase to a revival of corporate lending as well as improved absorption of EU funding.
The bank said private consumption remains Hungary’s “key growth driver”, supported by “substantially increased” disposable incomes.
It counted the value chain effects of a potential slowdown in the euro zone and labour shortages among the risks to its growth forecasts.
Meanwhile, Economy Minister Mihály Varga met EBRD First Vice President and Head of Client Services Group Jurgen Rigterink at the lender’s annual meeting in Jordan on Wednesday, the economy ministry said in a statement.
Hungary continues to count on the EBRD’s active lending and investment activities in Hungary, foremost in the private sector, Varga said at the talks.
“We believe it is important for the EBRD to further boost its lending and investment activities in Hungary and the region, because there is a great need to accelerate the process of convergence,” he added.