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Back to the IMF

November 21st, 2011

Left-wing commentators consider Hungary’s intention to resume talks with the IMF as sufficient reason for the prime minister to resign, although they don’t believe he will. A pro-government and anti-IMF commentator describes the government’s move as an act of capitulation.

In Népszava, editor in chief Péter Németh welcomes the decision, although he finds the explanations given by the government highly deceptive. “Let’s not worry about the government’s incapacity to admit defeat… and let’s be happy to see a strengthening Forint and a chance of recovery” – Németh argues, but adds that his next concern will be a question which figures in the title of his editorial: “When will PM Orbán resign?”

Népszabadság devotes three commentaries on one page to the prospect of new talks between Hungary and the IMF. Péter Pető bids farewell to the prime minister in the headline of his commentary, but admits that the left-wing opposition is not strong enough to dismiss the premier. He believes, however, that since Mr Orbán has opposed co-operation with the IMF for over a year, now that his government has asked for new negotiations, his own party should  replace him. “It is not the right wing that has to go. It is Orbán,” – he argues.

Róbert Friss remarks on the same page, that the Prime Minister has absolutely no intention of resigning, although an earlier rumour suggested that he had excluded an IMF-deal as long as he was in charge. In Friss’s view, the main question is whether the government actually intends to reach a deal with the IMF, or whether its initiative was only meant as a kind of “oral intervention”, aimed at avoiding a downgrade of Hungary’s government bonds by the rating agencies.

In a third comment on the Népszabadság OpEd page, Bence Kriván suggests that the future IMF talks will not be an easy ride for the Hungarian negotiators. “Forget about dictating to them at the negotiating table” – he warns. The IMF can be criticised and will not respond in public, but when it comes to opening a credit line, it will stick firmly to its conditions. “Our bargaining position depends on our market standing,” – Kriván remarks, and suggests that the government has pursued “amateurish policies” over the past eighteen months, which have undermined its credibility.

Hungarian weeklies went to print before the unexpected announcement was made on Thursday, and therefore bear no reference to the resumption of talks with the IMF in their commentaries, although some would certainly deem it necessary.

In his front page editorial, the editor-in-chief of Élet és Irodalom, Zoltán Kovács, suggests that Hungary will only be able to keep its public deficit below three per cent next year if it submits a completely new draft budget. An alternative would be to turn to the International Monetary Fund for help, but “Orbán insists on keeping Hungary IMF-free”. By the time the issue reached subscribers, the prime minister had authorized the resumption of talks, although Kovács thought that such a decision would be extremely risky, politically speaking: “The return of the IMF to Hungary would result in a huge loss of authority for Orbán, the consequences of which are simply incalculable”.

Magyar Narancs also believed that Orbán could never let the IMF back to Hungary, but argued in its unsigned editorial that someone else might find it indispensable. “(Socialist PM) Gyurcsány was toppled (by his own party) at around 300 Forints to the Euro” – the editor remarks. “How big is Orbán’s margin?”

In Figyelő, Gábor Lambert criticises the pro-government narrative, according to which Hungary is waging a “freedom fight” against the IMF and “certain financial circles”. He believes that this kind of rhetoric and the policy ensuing from it might create social conditions that would jeopardize the political élite which believes it can profit from such a narrative.

In a bitter commentary in Magyar Nemzet, Tamás Nánási believes the freedom-fight is over, and it has ended with Hungary’s capitulation. Only three days ago, Nánási published an editorial asserting that returning to the IMF “would entail a price much higher than we are forced to pay by following our own path,” (BudaPost,November16). Now he believes Hungary has been forced to the negotiating table through the “concerted effort of the actors of the financial markets”. Nánási compares what has happened to the case of a man opening a restaurant near Lake Balaton who is soon blackmailed by a mafia boss. Either he is willing to pay a “protection fee”, or his restaurant will be set on fire. “This is how the offer suddenly becomes attractive.”

As Budapost reported on Sunday, Magyar Hírlap, the other pro-government daily welcomed the government’s decision as an act dictated by pragmatism.

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