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Hungary - Economic reform

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Hungary - Economic reform

Short-term priorities:

  • evaluation and updating of medium-term economic policy priorities under the Europe Agreement;
  • continuation of structural reforms (in particular in the health care sector).

Assessment (October 1999)

On the whole this priority aim was achieved.

In 1999 Hungary adopted a medium-term economic strategy including sectoral policies aimed at improving conditions for growth and competitiveness. As part of the structural reform, the reorganisation of the pension system has been completed, although a comprehensive reform of the health care system was also necessary. The privatisation process was complete. Social security reform was urgently needed.

Assessment (November 2000)

The macroeconomic situation improved thanks to a reduction in the fiscal deficit and unemployment, higher growth and the introduction of structural reforms. There was still no systematic programme of reforms for the health care system. A plan for restructuring the steel industry had been drawn up but required further development. No progress had been made in establishing a functioning land market. The financial structure still had to be reformed.

Assessment (November 2001)

The macroeconomic situation remains sound. Economic growth has reached its highest level since the beginning of transition. Although privatisation has almost been completed, growth continues to be driven by foreign investment. Inflation is still relatively high. The current account has improved and fiscal consolidation has continued. After a promising start, the healthcare reform has been delayed. Land markets are developing. Restructuring of the steel industry has accelerated, and the Government has withdrawn its request for the period of grace applicable to state aid to the steel industry to be extended.

Assessment (October 2002)

Delays have occurred in reform of the health care system. Railway restructuring has been continued, and the establishment of an efficient agricultural land market has been addressed, as outlined in the action plan. Government accounting at local level has been improved.

Assessment (November 2003)

Please refer to the fact sheets on the adoption of the Community acquis.

Medium-term priorities:

  • consolidation of conditions to promote strong growth of investments through the adoption and implementation of prudent macroeconomic policies and continuation of structural reforms.

Assessment (October 1999)

After meeting the 1998 target for the general government deficit, Hungary continued to tighten fiscal policy and to increase the transparency of the budget through the abolition of the many separate state funds and the establishment of a contingency reserve in case GDP growth slowed down or the external accounts deteriorated more than envisaged. The new economic strategy provided the framework for improving the conditions for growth and competitiveness.

Assessment (November 2000)

The Széchenyi National Development Plan was designed to promote the development of SMEs. It focused on developing business culture and skills, promoting SME networks, improving access to finance and cutting red tape.

Assessment (November 2001)

EU fiscal accounting standards confirm the picture of a gradual consolidation in public finances. The small and medium enterprise sector has continued to develop in dynamic fashion. The Hungarian National Development Plan includes a specific programme for SMEs.

Assessment (October 2002)

Hungary has continued to promote the development of SMEs, but their access to finance remains an obstacle, although there is a government support scheme for SMEs. Overall, the accession partnership priorities in the economic sector have been partially met.

Assessment (November 2003)

Please refer to the fact sheets on the adoption of the Community acquis.

Following the signing of the Accession Treaty on 16 April 2003, Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia acceded to the European Union on 1 May 2004.

REFERENCES

Decision 99/850/EC of 6.12.1999Official Journal L 335 of 28.12.1999

Commission opinion COM(97)2001 finalNot published in the Official Journal

Commission report COM(98)700 finalNot published in the Official Journal

Commission report COM(1999)505 finalNot published in the Official Journal

Commission report COM(2000)705 finalNot published in the Official Journal

Commission report COM(2001)700 final - SEC(2001) 1748Not published in the Official Journal

Commission report COM(2002)700 final - SEC(2002) 1404Not published in the Official Journal

Commission Report COM(2003) 675 final - SEC(2003) 1205Not published in the Official Journal

Treaty of Accession to the European Union [Official Journal L 236, 23.09.2003]

Last updated: 19.11.2004

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