Azernews.Az

by Alimat Aliyeva

The Hungarian government plans to introduce the euro by 2030, but officials say that a sustainable reduction in the budget deficit and public debt will be essential before the country can join the eurozone.

After taking office, the new government said that Hungary’s financial situation was more difficult than previously expected and made stronger fiscal discipline one of its main priorities for the coming years.

The 2026 budget was originally based on a deficit target of 3.7% of GDP. However, a revised government assessment suggested that, without additional measures, the deficit could rise to 8.3%. The Finance Ministry now expects the figure to be around 7.5%.

According to the government, EU funding and other measures have helped prevent the situation from deteriorating further. The strengthening of the Hungarian forint, lower government bond yields, and the potential restoration of EU funding are also seen as factors that could improve the country’s fiscal outlook.

The government plans to revise the 2026 budget and establish a new deficit target by the end of August. The 2027 budget and a medium-term financial plan are expected to be prepared by the end of October.

Analysts believe that several factors could help Hungary reduce its deficit next year. Some one-off expenses that put additional pressure on the budget this year are expected to disappear, while lower bond yields and potentially lower interest rates could reduce the cost of servicing government debt.

In July, Finance Minister András Kármán announced a budget surplus of 524 billion forints, equivalent to approximately €1.44 billion. However, economists caution that temporary savings and one-off measures should not be mistaken for long-term fiscal stability.

To adopt the euro in 2030, Hungary will need to demonstrate a credible and sustainable fiscal strategy rather than simply achieve a one-year improvement. A consistent reduction in the deficit and public debt would also help maintain the confidence of investors, businesses, and international rating agencies.

At the same time, Hungary faces several economic risks. Weak external demand, particularly the sluggish performance of German industry, dependence on imported energy, and geopolitical tensions could complicate the government’s plans.

An interesting point is that joining the eurozone requires countries to meet several economic conditions, including limits on inflation, government deficits, public debt, interest rates, and exchange-rate stability. Hungary therefore cannot simply decide to adopt the euro in 2030 — it must first demonstrate that its economy meets the required criteria.

Ultimately, turning the 2030 euro target into reality will depend on whether Hungary can maintain a consistent economic policy over several years. Structural reforms, responsible tax policy, and investment decisions will all play an important role in reducing the deficit while supporting long-term economic growth.