Good IMF deal not far, says Orban

Budapest, October 12 (MTI) – Hungary is not far from reaching a “good agreement” with the International Monetary Fund on financial assistance, Prime Minister Viktor Orban said on Friday.

He told public Kossuth radio that new developments should be expected once the IMF general meetings in Tokyo is over.


He described the IMF as “a clever organisation that will not point a finger at you saying that unless you do this and that you will not get a loan. After all, it is our bank, so it must grant a loan if the conditions are fulfilled. Instead, more cunning, refined and skilled tactics are used but eventually […] evenry country cuts pensions, wages and jobs.”


He said the government maintains that Hungary will only use the funding to be made available for the repayment of public debt.


Commenting on recent ads the government placed in the media about the IMF, he said this method is somewhat alien to this cabinet but modern ways need to be introduced to communicate the truth to the people.


Orban confirmed that the government would announce action plans aimed at the lower-middle class in 2013. He said those earning between the minimum and 220,000 forints (EUR 770) a month have not yet had the possibility to progress from their current situation.


Commenting on the excessive deficit procedure, Orban said Brussels believes that if Hungary keeps its 2013 budget in the current form, it will not be able to keep the deficit under 3 percent of GDP. If the Hungarian government does not change the budget, the EU will withdraw many hundred billion forints in development funding. Orban maintained that Brussels is not right about this but said “there is nothing we can do now, if we do not want to lose resources, then we must adjust the budget.


Hungary would not need half of the recently announced nearly 400 billion forint budget adjustments if the European Union did not oblige the country to do so, Orban said.


Hungary will do what Brussels expects but the state of the economy will be better next year already than what is expected in the EU.


“It will show that quite many things that Brussels now rules out or wants us to rule out we will be able to accomplish, but we are not supposed to announce these today, only in the first half,” Orban said.


He quoted the example of postponing a planned increase in teachers’ wages until January 2014. He added that he will work hard to ensure that figures should develop already in the first half of 2013 in a way that will enable introducing the teacher’s career model as planned in September 2013, and added that chances are good that this will be possible.


The government has decided not to extend the financial transactions tax to the central bank as planned and instead introduce a higher transactions tax affecting the public “because the EU has demanded that we withdraw our plan,” Orban said.


“The EU has threatened to draw away so much funding that even though I do not agree with them, we had to oblige this force or step out of the way when it comes,” he said.


Commenting on his talks on Thursday with German Chancellor Angela Merkel, Orban said she precisely understands what’s happening in Central Europe, she understands what it was like to live in a dictatorship and she had empathy with the people of this region.


The talks focused on the EU and economic policy issues but there was also an open dialogue about contested issues, such as election rights and media regulations, he said.


Merkel understands the Hungarian position that “Hungary should think about joining the euro zone only if it opens new perspectives for the Hungarian economy and when Hungary is fully prepared,” Orban said.


What’s important to Germany is that Hungary should help making decisions that contribute to handling the euro crisis, he added.

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