| 1 March 2024, Friday |

Hungary’s Orban pledges to preserve economic stability as crisis looms

Even as the European Union enters a “economic catastrophe,” the government of Hungary will maintain economic stability and a cap on home energy costs, according to nationalist Prime Minister Viktor Orban on Sunday.

As the nation observed the anniversary of a 1956 uprising against Soviet control, Orban, who was reelected for a fourth term in a row in elections in April, predicted that the conflict in neighboring Ukraine would provide multiple difficulties in the next year.

“A war in the east, and an economic crisis in the West,” Orban told supporters in Zalaegerszeg, about 200 km (124 miles)west of Budapest, adding that there was “financial crisis and economic downturn in the EU”.

In Budapest, teachers and students were due to stage a protest against the government later in the day.

“In 1956 we learnt that unity is needed in difficult times … we will preserve economic stability, everyone will have a job, we can defend the scheme of caps on energy bills, and families will not be left on their own.”

Gas and electricity bill caps have been a cornerstone of Orban’s policy, but this year’s spike in energy prices drove up the costs of the program, placing a significant strain on the state budget. From August 1, the government was compelled to eliminate the cap for homes with higher usage.

The 2023 budget is up for discussion in December by the administration.

The budget, which was passed in July, predicted economic growth of 4.1% and inflation of 5.2% for the next year—forecasts that have already been rendered obsolete by the rise in prices into the double digits. While growth is anticipated to fall to 1% next year, headline inflation reached a high of 20% in September and is continuing climbing.

  • Reuters