Hungary must preserve its economic and political acting capacity which it finally regained after 2010, Nándor Csepreghy, Parliamentary State Secretary of the Prime Minister’s Office said at the business conference of the economic research institute GKI Gazdaságkutató Zrt., celebrating the 25th anniversary of its foundation, which was held in Budapest on Wednesday.
The State Secretary stressed: it must be accepted as a given feature that Hungary as a small and open country has a vested interest in the development of global trade, but at the same time it must also enforce its national interests. We must find the middle ground: neither purely globalist, nor protectionist policies can be pursued without limits, he added.
The Government must develop a sovereign economic policy that is based on national interests and maintains its acting capacity, an economic policy that guarantees within the European Union that the country’s performance should grow sustainably in the long run and its competitiveness should likewise increase, he said.
Mr. Csepreghy highlighted: there are debates with Brussels, but Hungary is not against the European Union, and has a vested interest in a fully functional and strong EU. A competitive European Union needs strong nation states, everyone must find the economic policy solution that is best suited to their individual and local specificities, he stated.
The State Secretary also indicated: the unsatisfactory responses given to the economic crisis, migration, terrorism and the conflicts taking place in the EU’s neighbourhood have shaken the very foundations of the EU. While in 2007 the EU accounted for 30.3 per cent of the world’s GDP, in 2015 it only accounted for a mere 22.5 per cent. Global GDP increased by 3.1 per cent in 2015, while that of the EU increased by just 1.6 per cent.
Even today, we are still in the period of finding the right path in the wake of the 2008 world economic crisis, and new economic policy directions have emerged in addition to the former, fundamentally neoliberal ideals, Mr Csepreghy said. He added that the emergence of new directions has also been assisted by the fact that it has finally been ascertained: these neoliberal ideals are unable to effectively manage the crises of their own regime.
In his keynote address delivered at the conference entitled The Landing of the Euro in Hungary, András Vértes, President of GKI spoke about the advantages and disadvantages of joining the Eurozone. In the summary of his lecture, he highlighted among others: political and economic adjustment to the EU will be the main issue beyond 2020. He said: the development of a multi-speed EU, or the threat thereof, will be among the expectations of the European Union with great probability.
He took the view that in order for Hungary to move closer to accession to the Eurozone, there is a need inter alia for stable and independent institutions, the reinforcement of legal certainty, and a genuine increase in competitiveness.
György Surányi, former Governor of the National Bank of Hungary told his audience: contrary to his former position and despite his major professional concerns, he takes the view that Hungary should consider entering the monetary union within 3 to 5 years after a phase of thorough and carefully considered preparations.
Changes are taking place in and around the European Union and the Eurozone which require a fundamental turnaround in the cooperation of the European Union and the management of the Eurozone, and Hungary has an elementary interest in ensuring that it does not find itself on the periphery, he said.
Former EU Commissioner and Hungarian Foreign Minister Péter Balázs argued that the Eurozone is an enormous region with a very thin outer limit. He took the view that it would be reasonable for Hungary, Poland and the Czech Republic to make coordinated efforts in their attempts to move closer to the Eurozone. By doing so, they could avoid the threat of a country that joined the EU later potentially overtaking them, he said.
Zsolt Darvas, a Senior Fellow at the Brussels Bruegel Institute believes that the introduction of the euro is primarily a political issue in Hungary. In the summary of his lecture, he stated among others that the country can be equally successful with or without the euro.
Gábor Regős, the head of the macro-economic research group of the economic research institute Századvég Gazdaságkutató Zrt. highlighted that it is worth joining the Eurozone at the right time and only after sufficient economic preparations, and agreed that coordinated efforts on the part of the Visegrád countries may be useful. At the same time, he drew attention to the fact that the one-time price shock and the possible inflation that may be a concomitant of accession may be a source of concern for members of the public.
István Pál Székely, Director of the European Commission DG ECFIN highlighted among others: all economic policy measures which help with the introduction of the euro favour the given economy also in themselves. This is why it is advantageous if accession to the Eurozone as a political goal accelerates the reforms which are necessary for the introduction of the euro, he said.