Lack of EU money is not the biggest problem in Hungary

Hungary is one of the worst countries in Europe, whether we look at the impact of government measures, energy security or energy price developments. This is the opinion of György Jaksity, Chairman of the Board of Concorde Értékpapír Zrt.

Hungary in trouble

György Jaksity, chairman of the board of Concorde Értékpapír Zrt., was interviewed by Szabad Európa. Jaksity has been in the spotlight several times over the last few years. Most recently, he said at the graduation ceremony of Corvinus University that Hungary was not illiberal. He urged recent graduates to fight for real democracy.

Jaksity believes that the biggest problem in Hungary may be the country’s inability to afford Russian gas. If Hungary cannot pay in physical currency, it will have to pay the Russians in geopolitical engagement.

Globalisation has already slowed down after the 2008 crisis. Current economic and geopolitical trends are continuing in this direction. Of all EU member states, Hungary is the most deeply integrated into the European economy. In other words, if the EU is in difficulties, so is Hungary.

According to Jaksity, Hungary will experience in the next quarter the same economic slowdown that America and Europe are experiencing now. The price cap is not sustainable forever. At some point, the Hungarian government will stop regulating prices and, consequently, the inflation rate could peak again.

Read alsoLack of EU money is not the biggest problem in Hungary

EU money will not help

Economic experts forecast Hungary to face a wave of bankruptcies and redundancies in the upcoming future. Jaksity said Hungary had been in the worst situation of all OECD countries. One of the biggest issues is that Hungary has a large current account deficit. As a result, it will not have enough foreign currency to pay for Russian gas.

It would not help either if an agreement would be reached with the European Commission on the withheld EU funds. The currency problems are steadily emerging. Now is the time to figure out how the Hungarian government will pay for up to a billion euros a month in energy imports, 444.hu reports. Whether and how much we receive from the European Union in the next seven years is irrelevant in the short term.

Read alsoLack of EU money is not the biggest problem in Hungary

Source: Szabadeuropa.hu, 444.hu