National Bank of Hungary (NBH) governor György Matolcsy said raising the volume and quality of state investments could help put the country on a sustainable convergence path.
In an op-ed piece published on the website novekedes.hu, Matolocsy said the “key issue” to restarting the economy after the coronavirus crisis would be “an advance in the direction of the new technological revolution of the 2020s”, rather than just “a recovery of the old economic structure”. In order to restart “strong, efficient and targeted investments”, the state will need to boost its investments “to at least 3,000 billion forints [EUR 8.2bn]” in 2021, Matolcsy said. He added that those investments should be focused on accelerating convergence in areas where Hungary still lags behind and on strengthening advantages achieved in the past decade. State investments reached 1,611 billion forints last year, data from the Central Statistical Office (KSH) show. He said gains in productivity should generate three-fourths of economic growth on a sustainable convergence path, while an expansion in employment makes up one-fourth. Together, such improvements could give Hungary an average annual GDP growth rate of 4-4.5%, he added.
hungarymatters.hu
