A bit more math
As I predicted yesterday numbers are flying. And not just numbers but words too. To recap: Viktor Orbán and Mihály Varga held a press conference on Wednesday where they outlined Fidesz’s remedies for the soaring food and energy prices. They claimed that a drastic decrease in VAT (ÁFA) would not cost the central budget a single cent (or to be more authentic, a fillér). The loss of revenues would be amply compensated for by increased domestic consumption.
One didn’t have to wait long before Ferenc Gyurcsány responded with his own press conference. Like Orbán he didn’t come alone. But unlike Orbán he didn’t have a high-level economist in tow but rather an ordinary elementary school math teacher. The claim was that any sixth-grade student should be able to realize that Orbán’s proposition is nonsense. The school teacher stood in front of a blackboard and explained that if Mr.Citizen went shopping for food in the supermarket and purchased 1,000 Ft worth of stuff, at the checkout counter he would pay a total of 1,200 Ft given the 20% ÁFA. If that ÁFA were reduced to 5%, Mr. Citizen would have to buy 4,000 Ft worth of food for the budget to receive the same 200 Ft in revenues. Surely, said Gyurcsány, this is an impossibility. People will not buy four times more food than they do today. Here is a photo with the simple arithmetic on the blackboard.
Meanwhile Fidesz altered their estimates. No longer do they claim that there would be no loss; rather, there would be a shortfall of only 120 billion as opposed to the government’s estimate of 320 billion. Read more »
Forint reaches five-year high against euro (Realdeal.hu – 04/07/08 10:11)
Hungary to step up checks on tourist buses (Caboodle.hu – 04/07/08 08:19)
What happened to the Hungarian forint and why?
Over the past few months the forint was steadily becoming stronger, with all the positive and negative consequences of a strong currency. It was a bonanza for those people who bought their apartments or houses by taking out mortgages in Swiss francs or euros. It was made foreign travel less expensive for Hungarian tourists. On the other hand, it was not so good for Hungarian exports or the rate of inflation.
But on Friday, suddenly, out of the blue it seemed, the Hungarian forint lost 1.88% of its value. It happened around 3:00 p.m. By 4:00 one euro was worth 247.10 forints whereas a day earlier the exchange rate was 242.60 forints to one euro.
Read the entire article: What happened to the Hungarian forint and why »
money, forint, value, currency
A new economic plan?
In the last few days the news that has piqued Hungarian interest is a study called “Kilábalás” (loosely translated, “Recovery,” closer to the original, “Getting out of trouble”). The authors are four fairly young economists – Krisztián Orbán, Péter Holtzer, Tamás Vojnits and Gyula Barabás. They own Oriens, an M&A financial consulting company operating in Central and Eastern Europe, and also manage a private equity fund with investments in Hungary, Romania, and Bulgaria. It seems that George H. Walker, III, former U.S. Ambassador to Hungary and first cousin of former president George Herbert Walker Bush, and George Pataki, former Republican governor of New York, are on the fund’s board.
The young economists claim that, although Oriens is a business venture, the economic program they prepared was not commissioned by anyone. However, the leaked Orbán speech in a primitive way echoes some of their suggestions.
Read the entire article: A new economic plan? »
Hungary, economy, economic plan, Oriens
US visa-free program – decision after October 1
The US decision whether Hungary is included in the visa-free program is expected after October 1, when it is verified if the ratio of rejected Hungarian visa applications is below 10 percent, the US Consul General to Hungary told reporters on Thursday.
The consul said that this ratio had been 10.3 percent in 2007 and added that he hoped that this year it would drop below 10 percent, which was a prerequisite for inclusion in the no-visa program.
The United States’ goal is to ensure that citizens of Hungary and other applicants for the program could visit the US without mandatory entry-visas soon, as early as January next year.
On May 20, representatives of Hungary and the United States signed an agreement on bilateral data exchange seeking to help identify terrorists. The agreement is a prerequisite for Hungary’s exemption from US visa requirements.
Source: MTI News
USA, visa, US visa-free program, USA entry visa
EUR 2 billion Dream Island Project
Álom Sziget Entertainment Zrt. has won the gaming concession and can now go ahead with its “Dream Island” project on Hajógyári sziget. Read more »
BKV Strike Called Off
Budapest transport company BKV’s in-house unions and management reached an agreement on Tuesday afternoon, averting a two-day strike planned on Thursday and Friday. BKV management accepted union demands to extend by one year the collective bargain contract, which was due to expire at the end of 2008. Read more »
BKV Budapest Transport Strike Dates Set for May 29 – 30
The Budapest Transport Company union’s strike committee set the dates for a two-day strike at May 29 and 30, two days later than originally planned, to leave more time for negotiations with management, said strike committee chair Gabor Nemes on Friday. Read more »
Orbán’s Future Government Plans
Fidesz chairman Viktor Orbán is reportedly ready to halt the ongoing major state investment projects such as the fourth metro line project and would freeze motorway construction payments if he regains power. Read more »
EIU Survey Ranks Hungary as a Peaceful Country
The London-based Economist Intelligence Unit (EIU), a leading center of global economic and political analysis, ranked Hungary among the most peaceful nations of the world in its Global Peace Index released on Tuesday. Read more »
Central Europe’s Greatest Water Theme Park!
Aquaworld (Ramada Resort – Aquaworld Budapest) is set to open its doors in the fall of 2008. The Aquaworld water empire will be Central Europe’s biggest indoor water theme park: 11 slides, 17 pools, surf pool, which is extraordinary even in Europe and further amusement elements will make the complex unique Read more »
Hungary Drops in Competitiveness
Hungary slipped back three places to 38 in the World Competitiveness Yearbook survey compiled by Swiss economic institute IMD. The report covers 55 countries and measures competitiveness based on some 300 criteria. Read more »
Rail Strike May Happen Anytime
Railway workers may go on strike again at any time, as the positions of MÁV management and the Free Union of Railway Workers did not move any closer in Wednesday talks. Read more »
Hungary: Current Macroeconomic Forecast
Getting out from the hole
According to the forecast prepared by GKI Economic Research Co. in co-operation with Erste Bank the Hungarian economy will bottom out from the last year’s “hole” by the end of 2008. This year real earnings will already grow – although slowly. If the global financial market stabilizes, the forint interest rates may decrease. Read more »
Hungarians Unaware of Retirement Risks
Nearly two-thirds of Hungarian workers stop working before the official retirement age, 80% of them voluntarily, a GFK survey commissioned by French insurance group AXA found. Hungary came second in both these categories among the 26 countries surveyed. Read more »
Cabinet Allocates Ft 10bn to GPs, Dentists
To compensate for the shortfall of revenues following the March 9 referendum in which doctor visiting fees and hospital fees were cancelled, the cabinet is ready to allocate Ft 10 billion to GPs, pediatricians and dentists. Read more »
Hungarian Forint: More Rate Hikes on Way
London analysts forecast more rate hikes from the National Bank (MNB). JP Morgan expects the MNB to raise the base rate by 25-basis points on Monday, followed by a similar hike a month later, bringing the two-week lending rate to 8.5%.
Other major banks and financial groups in London also predict Read more »
New Tuition Fee Proposal
The Conference of Hungarian Rectors approved an alternative tuition fee proposal behind closed doors at Károly Róbert College in Gyöngyös yesterday. According to plans in the possession of Magyar Hírlap, a broader sphere of college and university students would be obliged to pay tuition fees. Read more »
Cultural Tax on Clothing
Socialist MP János Schiffer has proposed expanding the 0.8% “cultural” revenue tax to include clothing. The government supports the idea, because clothing represents cultural values through design, Cultural Ministry undersecretary Márta Schneider said. Read more »
Forint Weakens
The forint was trading down more than 1% against the euro at near 254 Wednesday after rumors of a possible downgrade of Hungary by credit-rating agency Standard & Poor’s. Read more »
No Public Transportation in Budapest on Friday!
Talks Fail to Avert Daylong BKV Strike. Public transport in Budapest will not be running on Friday as BKV management and unions failed to reach agreement yesterday. No talks are scheduled for today.
If the walkout goes ahead, the 22 BKV unions will be on strike Read more »
OVI to Verify Referendum Signatures
The National Election Commission (OVB) on Monday ordered the National Election Office (OVI) to start verifying the signatures submitted in favor of a referendum against the privatisation of health insurance. Read more »
Forint Rises Again
The forint strengthened to a four-month high of 251.46 per euro in intense trading yesterday afternoon, due to closing of stop-loss positions and the successful government bond auction, according to a trader with ING bank. The currency closed at 158.82 per dollar, a new 11-year high. Read more »
All-day BKV Strike Set for April 18!
Employees of Budapest public transport company BKV have resolved to go on strike for the whole day on Friday, April 18, following unsuccessful talks on Wednesday. Read more »
Yahoo Buys Hungarian Software Maker
US internet company Yahoo announced that it had agreed to buy Hungarian firm Tensa, known as IndexTools, a producer of web marketing analytics software. Read more »
National Strategy for More Children
Social Affairs and Labour Minister Mónika Lamperth on Tuesday outlined the cabinet’s strategy to boost the birth rate. Read more »
Forint Strengthens to 3-month High
The forint strengthened to a three-month peak of Ft 253.3 per euro yesterday, riding an upbeat global mood. The forint hit 162.3 per US dollar, an 11-year high. Read more »
Gyurcsány Vows Moderate Reforms
A moderate reform policy that can be implemented is worth more than failed radical reforms, Prime Minister Ferenc Gyurcsány told an international press conference on Friday. Read more »
Referendum a Success; Fees to be Abolished
Hungarian voters rejected nominal medical fees and post-secondary tuition fees by a overwhelming margin in Sunday’s referendum, as 82-84% of those who turned out opposed the charges. Read more »
Drinking & Driving: ‘Zero-tolerance’ Law
Drivers under the influence of alcohol can have license seized on the spot! As of January 20th, 2008, drivers in Hungary who have consumed even the tiniest amount of alcohol can have their driver’s license seized on the spot. Read more »
