The prime minister also spoke about the situation of the Hungarian economy, the policy of price caps and the effects of sanctions on Kossuth Rádió Good morning, Hungary! in his show.
Sanctions fuel price increases and inflation
According to Viktor Orbán, the insight that sanctions lead to high energy prices will bring change throughout Europe. "This is a sanctioned surcharge," he said.
And energy prices are responsible for inflation - continued the Prime Minister. He added: All European countries suffer from inflation to varying degrees and this is mainly due to EU sanctions.
"If the price of energy goes up - and the sanctions are a price-increasing factor - say two or three times, then it will also bring two or three times inflation,
so there is a direct correlation between high energy prices and the value of the bills paid in the store"
he explained. Food inflation is also largely due to the price of energy, which is related to the increase in the cost of transportation or the difficulties in agricultural production, for example the issue of fertilizer - which is an issue of natural gas.
"If there were no sanctions, let's say tomorrow morning a fairy magically eliminated them, then we would find that the prices, that is, the rate of inflation, the rate of price increase, would immediately drop by at least half, but maybe even more."
explained the prime minister.
New price stops may come
According to the Prime Minister, the national consultation is important in addition to the expression of opinion, so that everyone, companies and people, realize that they are in danger due to the economic situation, just in a different way.
Viktor Orbán emphasized that the government does not stand idly by as prices rise, "we must do everything we can to reduce inflation" He also referred to what he had said earlier that
By the end of 2023, inflation must be brought to single digits in Hungary.
And the companies are at risk in the sense that they will lose their competitiveness due to the increase in energy prices, and if this happens there will be layoffs. It is also important for the government to support them so that there is no unemployment.
According to the prime minister, the government has important tasks in all areas of the economy. "That's why there's a gas price stop, that's why there's utility protection, that's why there's a price cap on certain products and food products, and that's why we'll continuously decide in the coming weeks whether to expand one centrally regulated product or the list of these with new ones," he explained .
"There will be new products, the price of which we want to determine centrally, the maximum, as we do today for six basic foods"
Viktor Orbán announced.
Price regulation currently covers the following basic foodstuffs:
-
granulated sugar
-
fine wheat flour (BL 55)
-
refined sunflower cooking oil
-
homemade pork leg
-
chicken breast, chicken leg-back, chicken back, chicken tail, chicken wing tip
-
ultra-high temperature heat-treated cow's milk with 2.8% fat content
The interest rate stop is important for companies
In the case of companies, there are basically two types of interest: fixed and variable. Where it is fixed, the current rapid interest rate increases do not affect businesses, but with variable interest rates, it means a big jump, which " cuts companies to the ground ", they have to lay off people.
There was a bitter debate about the interest rate cap at the last government meeting, but in order to protect companies
they decided not to allow interest rates to rise to, say, 20 percent, but to draw a limit, i.e., to stop interest rates around the 7.7-8 percent level. The costs of this will have to be paid by the banks
he added.
It is not a good thing when the economy has to be intervened in this way, but there are crisis situations when it has to be done, he emphasized. The interest rate cap lowers the ceiling to the June interest rate level and is effective from November 15.
Larger companies are less exposed to risks, which is why small and medium-sized enterprises need to be helped more, since they employ the most people. Of course
large companies are not left alone either, a HUF 150 billion factory rescue program was launched to help them as well. The essence of this is that energy-saving investments are realized in Hungary.
Source: MTI / hirado.hu
Photo: Zoltán Balogh / MTI
