Economic ‘standstill’

András Inotai made the announcement at a forum hosted by the predominantly social-democratic civilian group Otthont Magyarországból Összefogás (OMÖ or Unity for a Home in Hungary), which was timed to coincide with Prime Minister Viktor Orbán’s "State of the Nation" speech.

Vilmos Hanti, General Director of the OMÖ, said the opposition and ordinary people had the right to evaluate the state of the nation as well as the Prime Minister.

He said Orbán’s state of the union-style address was "theater" which was being broadcast with tax payers’ money and with a paid audience to applaud.

Inotai, also President of the Europe 2002 Foundation (a think-tank of experts studying Hungary in relation to the EU), said, "I don’t want to talk about the Széchenyi Plan, but about István Széchenyi who once said that when a valuable coin rolls away it can always be retrieved, but when you lose valuable time it can never be retrieved."

He continued, "Hungary’s modernization process has stalled. We have a Széchenyi Plan, but it lacks real economic strategy.

"Economic policy cannot be replaced by a public relations campaign."

He said the Government had failed to achieve successful modernization and economic stability.

"Even without the upheaval created by the September 11 attacks, foreign investments in Hungary have dramatically declined during this period," he said.

Earlier Inotai said that last year only 8% of foreign capital invested in the region came to Hungary, while 27% went to Poland, 23% to the Czech Republic and 13% to Russia.

He also said Hungary’s domestic politics had taken precedence over interests related to Hungary’s accession to the European Union.

"The most crucial reforms - health, institutional, regional and educational - have failed," he said. "The pension reform (started by the previous Government), one of Hungary’s most advanced reforms and a forerunner even by EU standards, was abandoned by the current Government."

He said maintaining Hungary’s competitiveness in the region was the number one priority, but added the Széchenyi Plan was not serving this.

Inotai, who recently completed research titled The structural changes of Central and Eastern European nations and Hungary, reflected by their exports to Germany, said that currently Hungary’s competitive advantage was still high technology-based lower-cost human resources. "However we are rapidly losing this advantage," he said.

But György Matolcsy, Minister of Economic Affairs, said foreign direct investment had dynamically increased over the past six years in Hungary. "In 2000 alone Hungary attracted a record amount of working capital, in euro terms the equivalent of $2.1 billion," he said.

He added that in the last four years Hungary had seen the highest annual GDP growth in the region (4.2% as compared to the EU average 2.1), while this year the country expected 3.6% growth as compared to the EU average 1.2%. He said Inotai’s figures on foreign direct investments in Poland and the Czech Republic showed "these countries have finally reached the stage that they should have reached years ago".

He added, "They are catching up to Hungary, which is still the leading country for foreign investments."

Click here for the Source – Budapest Sun Online