Fitch: Hungary could meet euro entry criteria by 2030
The ratings agency sees the Magyar government’s austerity budget as a step towards the eurozone. The deficit is set to fall from 7.5% to below 3%.
Symbolic image · Photo: Dennis G. Jarvis / Wikimedia Commons, CC BY-SA 2.0 (cropped and resized)
Hungary could meet the criteria for joining the eurozone by 2030, according to ratings agency Fitch. Its assessment is based on the 2027 draft budget presented by Prime Minister Péter Magyar on Monday, which targets a general government deficit of 4.9% of GDP, down from an expected 7.5% this year. The government aims to cut the deficit gradually to 2.8% by 2030. Fitch itself forecasts 7.3% for 2026 and 5.4% for 2027, with the deficit expected to fall below 3% by 2030. The agency said the 2027 target was an important measure of the credibility of the government’s consolidation strategy.
The plan includes spending cuts of 1.5% of GDP and new revenue of around 1%, including corporate and innovation taxes, a wealth tax and a levy on energy companies. Ministries and state-owned companies must cut operating costs by at least 10%. Fitch warned of the large number of relatively small measures and the need for sustained consolidation. It expects public debt to peak at 77.7% of GDP in 2027–28.
A sound budget alone is not enough for the euro, however: Hungary must also meet criteria on inflation, long-term interest rates and exchange-rate stability. Consultancy Eurasia Group considers entry possible in 2032 at the earliest if the country joins the ERM II exchange-rate mechanism in 2030. The EU recently released €4.2 billion for Hungary as part of an agreement worth a total of €16.4 billion.