BRUSSELS — The European Commission greenlighted Hungary’s medium-term fiscal-structural plan on Thursday after Budapest provided the bloc’s executive with updated and previously missing data. Hungary is now forecast to exit the additional surveillance regime for overspending countries in 2026.According to the new document, the country’s deficit — the difference between budget revenues and expenditures — is set to be 3.6 percent of GDP in 2025 and 2.5 percent the following year, below the EU’s 3 percent threshold. The country’s overall debt is expected to amount to 68.2 percent of GDP by 2028.EU envoys decided on Wednesday to postpone until February a vote by finance ministers on the previous recommendations for Hungary in light of the Commission’s new assessment, four diplomats and one Commission official told POLITICO.The updated plan — with data Hungary provided on Dec. 20 — shows “a more favorable initial fiscal position,” higher inflation, and “a better-than-expected budgetary outcome for January-November 2024, in particular higher-than-expected non-tax revenue and slightly lower-than-expected expenditure,” the Commission wrote in its assessment.
The executive also underlined that the plan does not include “a fully-fledged and quantified fiscal strategy.” On the contrary, there are a “number of unquantified deficit-increasing measures across different areas,” so “further fiscal measures may thus be needed to achieve the commitments.”
The plan also presented a slate of 132 reforms and investments aligned with the EU’s common priorities, more than half of which will be funded by EU programs.As with other overspending countries, Hungary is to present a report on the steps it has taken to meet the EU’s fiscal targets by the end of April.
The post Hungary wins EU approval for its four-year fiscal plan appeared first on Politico.
