April 3, 2009

Hungary economy to drop 5-6 percent

The Hungarian government expressed fears its economy would shrink by 5-6 percent this year, nearly twice as much as earlier projections suggested.

Hungarian Deputy Finance Minister Laszlo Keller said economic experts were certain the decline will be deeper than the government's original prognosis of an annual drop of 3.5 percent in 2009, the Budapest Times online newspaper reported Friday.

The government of Prime Minister-nominee Gordon Bajnai, taking into consideration the new prognosis of up to 6 percent recession, should work out a new state budget for 2009, Keller said.

Bajnai already planned public spending cuts of up to $543 million in 2009 and any further decline in economy would produce a revenue loss of about $905 million and new spending cuts, Keller said.