“The existing plans for 2020 must be put aside for the moment; the coronavirus represents a danger to both the people and the economy, and accordingly the fight against its spread overwrites all previous economic policy efforts”, Minister of Finance Mihály Varga said following and expanded video conference of Eurozone finance ministers.

“According to Hungary’s position, effective action against the virus requires cooperation between member states, and expenditure relating to the epidemic must be handled flexibly and in line with the situation within the EU budgetary regulations”, he said.

The ministers involved discussed the topics of the expanded Eurogroup meeting within the framework of a video conference, Mr. Varga told the press, adding that one of the main topics of discussion had been the effects of the coronavirus epidemic on Europe and the global economy. “The European Commission has set up a working group aimed at enabling the most efficient possible reaction to the challenges posed by the virus”, the Minister added, explaining that reinforcing healthcare systems, mitigating the losses suffered by small and medium sized enterprises, and the protection of job markets and less resistant sectors are currently at the focus of EU budget policy.

“A decision was made on the establishment of a 37-billion-euro fund to mitigate the economic problems caused by the coronavirus epidemic. The European Commission is also planning to introduce investment promotion measures, including the fact that member states will not have to repay the 8 billion euros in advance payments not spent last year, but will be able to retain those funds within their national budgets”, Mr. Varga pointed out.

The European Central Bank is launching the last round of its asset-backed loan programme with extremely favourable conditions, in addition it will also be relaunching its asset purchase programme, and is prepared to mitigate the market tensions being experienced on the stock markets with 120 billion euros until the end of 2020, he continued. In assessment of the Hungarian situation, the Minister said the most important current task is to protect lives, and funding will also be channelled to this task.

“This year’s budget includes reserves equating to 1 percent of GDP, but if necessary more resources are also available for expenditure relating to the coronavirus epidemic, in addition to which the government has earmarked a further 8.8 billion forints (EUR 25.7 million) for the healthcare service system”, Mr. Varga highlighted, adding that a new Economy Protection Action Plan is being developed to adapt to the changed conditions, the most important goal of which will be to reboot the economy.