Hungary’s Fiscal Council head expects GDP growth to surpass 4 pc in 2017, 2018

Budapest, April 27 (MTI) – Hungary’s economy is likely to grow by above 4 percent both this year and next, the head of the Fiscal Council told a conference on Thursday.

Árpád Kovács said the public debt would continue to fall and budget deficit would be below 3 percent of GDP in both years. Further, economic trends in 2017 and 2018 are expected to be better than in 2016 due to the positive impact on growth of EU development funding with a positive effect on corporate investing.

Inflation is expected to average around 2-3 percent next year, he added.

Downside risks involve challenges on the labour market, unfavourable demographic trends and a lag in competitiveness compared with other countries in the region.

Kovács noted that some counties in the eastern and northern parts of Hungary have lost 10 percent of their population in recent years due to emigration. This is partly offset by around a trillion forints of remittances in past years which has lifted domestic demand.