Hungary’s economy minister sees possibility for adopting euro by 2020 – UPDATE

Budapest, July 19 (MTI) – Economy Minister Mihály Varga suggested in an interview published by daily Magyar Hírlap on Tuesday that Hungary could adopt the euro by the end of the decade, but only if economic trends continue to improve and the common currency becomes more stable.

“If economic trends are long-lasting, if we move closer to the European Union’s developmental average, and if our productivity continues to improve, I don’t consider [eurozone] accession groundless by the end of the decade,” Varga told the paper.

“However, this requires a more stable euro together with a joint fiscal policy on a more secure standing,” he added.

EU member states that want to join the eurozone must keep consumer inflation no more than 1.5 percentage points over the three best-performing member states, their public finance deficit must not exceed 3 percent of GDP and their state debt must be no more than 60 percent of GDP. Their long-term interest rates must be no more than 2 percentage points over the rate of the three best-performing members states and they must join the ERM-II system, the waiting room for euro adoption, for at least two years without severe tension.

According to the European Commission’s and European Central Bank’s latest convergence report, Hungary only fails to meet the last criteria, Varga noted.

“I very much hope we will adopt the euro, but fortunately it’s also up to us to decide when,” he said.

The opposition Socialists dismissed Varga’s remarks as “farcical”, and suggested that ruling Fidesz “aims at quitting the European Union rather than adopting its currency”.