ÁRPÁD KOVÁCS FISCAL COUNCIL HUNGARIAN ECONOMISTS ASSOCIATION UNIVERSITY OF SZEGED CRISIS MANAGEMENT IN THE EU-10 COUNTRIES: A CHANGE OF POSITIONS BUDAPEST, MARCH 22.

1. Processes leading to the positions in The broad picture: crisis management at home and abroad 3.Snapshot Key points

1. Processes leading to the positions in The broad picture: Crisis management at home and abroad 3.Snapshot

Fig. 1. Government debt as a percent of GDP Source: EUROSTAT

Fig. 2. Internal Distribution of the Expenditure Gross Sum, as a percent of GDP, 2000 Investments Capital transfer Other current transfers Social expenditures Interest Subsidies Compensation of employees Operating expenditures

Source: EUROSTAT Fig. 3. Trends of Government Debt EE SL SK BG CZ LT LV HU PO RO

1. Processes leading to the positions in The broad picture: crisis management at home and abroad 3.Snapshot

1. SZÁMÚ TÁBLÁZAT: A VÁLSÁGKEZELÉS JELLEMZŐ LÉPÉSEI ÉVEKBEN Country Crisis managing steps taken Significant cutback in goverment expneditures Increasing taxes, customs, additional fees Decreasing taxes, customs, additional fees Taking out significant loan on the financial markets, using for current account payments Taking out loan from international financial institutions, forced by the crisis Introducing extra taxes on banks and financial institutions Introducing extra taxes on services Unique bailout actions for banks New management and / or control agencies in public finances Interventions on the labour market Stimulus programs, consumption revitalization Other, unique act ions (eg, privatization, absorbing pension fund assets ) Changing operational rules for public finances EU-10 BG XXX X X X CZ X X X XX EE X X XX HU XX XX XXX X PO XX X X XX LV XX X X XX LT XXX X XX RO XX XX XX XX SK XX X XX SL XX XX X Table 1. Crisis management Source: OECD/EU (self edited)

1. Processes leading to the positions in The broad picture: crisis management at home and abroad 3.Snapshot

1. SZÁMÚ TÁBLÁZAT: A VÁLSÁGKEZELÉS JELLEMZŐ LÉPÉSEI ÉVEKBEN Country Crisis managing steps taken Significant cutback in goverment expneditures Increasing taxes, customs, additional fees Decreasing taxes, customs, additional fees Taking out significant loan on the financial markets, using for current account payments Taking out loan from international financial institutions, forced by the crisis Introducing extra taxes on banks and financial institutions Introducing extra taxes on services Unique bailout actions for banks New management and / or control agencies in public finances Interventions on the labour market Stimulus programs, consumption revitalization Other, unique act ions (eg, privatization, absorbing pension fund assets ) Changing operational rules for public finances EU-10 BG XX X X CZ XX X X EE X X HU XX XX X X XXX XX PO XX X LV X XX X LT XX X RO XXXX XX X SK X X X X X X SL XX X X XXX XX Table 2. Crisis management Source: OECD/EU (self edited)

Fig. 4. Growth trend, as percent of GDP EE SL SK BG CZ LT LV HU PO RO Source: EUROSTAT

EE SL SK BG CZ LT LV HU PO RO Source: EUROSTAT Fig. 5. Balance of Public Budget, as percent of GDP

Fig. 6. Potential growth, as percent of GDP Source: EUROSTAT, OTP, Szilárd Kondora, László Muraközy V4:HU/CZ/SL/PL; PIIGS: PO/IT/IR/GR/SP Hungary Eurozone avg. V4 avg.PIIGS avg.

Fig. 7. Investments and growth, as percent of GDP EU27EU10POCZSKHUSLEELVLTROBG Source: EUROSTAT

Source: Reuters, CEE avg and discrepancy from avg, by country Fig. 8. CDS spreads and economic policies

Source: Focus Economics, january; CEE: V4+RO/BG Fig. 9. Expected growth, as percent of GDP HU CEE avg. (ex HU)

Source: EUROSTAT; CEE: V4+RO/BG Fig. 10. Investments, as percent of GDP HU CEE avg. (ex PL)

Fig. 11. Net placement in private sector by banks, seasonally adjusted, as percent of GDP HU Source: National Banks; CEE: V4+RO/BG

Source: EUROSTAT, EC autumn forecasts Fig. 12. Sum expenditure of consolidated budget, as percent of GDP SK CZ HU PO RO BG

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