Former central bank governor, Andras Simor, has warned that Hungary is moving closer to the possibility of leaving the European Union (EU). While Simor acknowledged that an exit from the bloc is not the most probable outcome, he stated that it is now a possible one. He estimated the probability of Hungary leaving the EU to have risen from 10% last year to around 20% to 30% currently. Simor, who played a crucial role in leading Hungary through the financial crisis and securing an IMF-led bailout, voiced concerns that the government's actions could lead to a situation where leaving the EU becomes a genuine alternative.
Hungary has been facing economic challenges, including a record budget deficit resulting from Prime Minister Viktor Orban's spending spree in the run-up to last year's elections. Additionally, the country has the highest inflation rate in the EU and the key interest rate is also high. Compounding these issues, over $30 billion of EU aid remains blocked, as the bloc has withheld the funds due to concerns of government backsliding on democratic commitments and allegations of corruption.
Despite expressing his concerns about Hungary's trajectory, Simor does not expect an immediate economic collapse. Instead, he foresees a gradual decline for the country. Simor's views reflect his ongoing criticism of Prime Minister Orban's policies.