BUDAPEST: Hungary's high funding costs, low growth potential and high debt levels have brought it perilously close to "critical levels" of sustainability, a central bank deputy governor said, calling for a turnaround in economic policy to curb borrowing costs.
"The gross state debt and net external debt levels of the Hungarian economy are extremely close to those critical levels over which they definitely impair potential (economic) growth," Julia Kiraly told a business conference organised by Portfolio.hu on Thursday.
She said even at the 1.5 percent economic growth rate that is now considered realistic for Hungary, it would require a primary budgetary surplus worth 3-4 percent of economic output just to keep state debt steady at 80 percent of GDP.
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