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Government buys majority share in Budapest airport

April 11th, 2024

A liberal economist accuses the government of setting the wrong priorities and predicts austerity measures for the second half of the year.

Prime Minister Viktor Orbán told parliament on Monday that the acquisition of Budapest Airport could be concluded within days. Since 2010, the government has boosted Hungarian ownership in energy, banking, telecoms and the media, and has been trying to buy the airport for years. Vinci Airports (France) will buy a 20 percent share in the airport company and a Qatari investment fund is expected to join in later. Economy Minister Márton Nagy said in 2023 that the financing of the package could include budget funds and the sale of government assets.

On Klubrádió István Csillag, who served as Minister of the Economy from 2002 to 2004 identified strategic choices including the airport acquisition as important factors contributing to excessive public deficits. Others include pre-electoral measures to support wage hikes well over the level of inflation this year. On the receipts side, he added, expected VAT increases failed to materialise because the population is consuming less than last year. The deficit of the first quarter, he continued, already amounts to two thirds of the already (upwards) revised deficit planned for the whole year. Csillag therefore expects the government to introduce austerity measures after the European and municipal elections in June to keep the deficit at 4.5 percent of GDP. He believes those measures will include halting government investment projects.