Hungary Targets Eurozone Membership by 2030 Amid Fiscal Challenges

Hungary is aiming to join the eurozone by 2030, according to Mihály Varga, governor of the Central Bank of Hungary. Varga made this statement at a meeting of economists, where he emphasized that public support, preparation of the real economy, and a clear strategy are crucial for the success of the transition to the single currency.

Varga noted that approximately 80% of Hungarians currently support introducing the euro, although the population remains cautious about the decision's effects. However, adopting the European currency would require stricter fiscal discipline, which is challenging due to Hungary's slow economic growth, demographic challenges, high debt, increased financing costs, and inflationary pressures.

The public debt criterion, which should not exceed 60% of GDP, is considered the most difficult to meet. Before joining the euro area, Hungary must improve its fiscal position and enter ERM II, the mandatory exchange-rate stabilisation mechanism. The country does not yet have an official date for adopting the euro and does not meet all the European convergence criteria.