The building of the NBH in Budapest – Photo: wikimedia

Matolcsy: Investment growth, job creation and cheap credit key to recovery

National Bank of Hungary (NBH) governor Gyorgy Matolcsy said investment growth, job creation and cheap credit will be necessary for Hungary's economic recovery from the coronavirus crisis in an interview published in Monday's issue of daily Magyar Nemzet.

“We have every chance for Hungary to achieve one of the fastest rates of post-crisis economic growth in the past century. But that will require achieving three things,” Matolcsy told Magyar Nemzet.

“First, the investment rate must remain over 25 percent each year, and it has to be raised over 27 percent from 2022, because investments are the foundation for future economic growth,” he said.

“This will require an increase in state investments as well as support for investments by households,” he added.

He said the other two factors that must be achieved are creating as many jobs as have been lost because of the coronavirus crisis, and making cheap credit available to corporate and retail borrowers.

“A credit-free recovery must be avoided, because that would, by necessity, be slow and protracted. Every business that wants to invest and upgrade, and every family that wants a bigger, more environmentally-friendly home must have access to cheap financing,” he said.

Looking forward to 2021, Matolcsy said he was “optimistic”, but added that achieving widespread immunity among the country’s population and “overcoming the fear caused by the pandemic” would be the “decisive factor”.

He also stressed the importance of being proactive in supporting a speedy economic recovery.

“The National Bank of Hungary remains ready to support the recovery of the Hungarian economy with all tools at its disposal,” he said.

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