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Hungary cannot save all businesses, PM Orban says - Metro US

Hungary cannot save all businesses, PM Orban says

FILE PHOTO: Hungary's PM Orban takes part in an annual business conference in Budapest

BUDAPEST (Reuters) – Hungary will help businesses to survive the economic fallout from the novel coronavirus pandemic, but changes in the economy will force a rethinking of what works and what markets have been lost for good, premier Viktor Orban said on Friday.

The crisis has presented Orban with the toughest challenge to his decade-long rule. His response — to rule by decree indefinitely — has drawn criticism from the European Union.

Hungary has announced tax breaks and wage contributions as well as massive lending subsidy programmes, but some business leaders voiced frustration at the lack of the blanket cash handouts seen in other countries.

The National Bank of Hungary has said it expected growth to stay positive this year. Economists, however, widely expect a contraction; the International Monetary Fund forecasts a 3% reduction.

Orban was not as bullish as the central bank. “It would be a huge accomplishment to weather this crisis with a growth rate near zero,” he told state radio. The economy will undergo qualitative as well as quantitative changes, he said.

“Businesses need to see what activity will have a place, how they can make a profit after the crisis, and what will be the parts of their businesses that will lose its market and its orders once and for all.

“It’s better to face that than to kid ourselves to think the government will help us sustain everything and all will be as before the pandemic. No: everyone must adapt.”

He said the government will focus on where the economic effects of the pandemic are the gravest, such as tourism, which had produced around 10% of the country’s economic output and employed 400,000 of its 10 million citizens.

“Tourism has been shot through the lungs,” he said. “That industry has just died.”

“We expect a little more of everyone than just make it through. We expect them to think about their personal future and seek the path to happiness,” he said, noting the retraining programmes that the government has put in place.

Hungary has recorded 1,763 infections in the pandemic and 156 deaths as of Friday morning. The real number of infections is probably significantly higher, the government has noted.

(Reporting by Marton Dunai, editing by Larry King)

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