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Hungary asks IMF to leave the country after early payback

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(RT) – Hungary has announced plans to repay its bailout loan from the International Monetary Fund early and asked the organization to leave the country.

The head of Hungary’s Central Bank Gyorgy Matolcsy wrote a letter to IMF Managing Director Christine Lagarde on Monday asking for it to close its representative office in Budapest as it was “not necessary to maintain” it any longer.

The IMF says it is ready to agree since the current IMF representative in Hungary is due to leave soon anyway.

Hungary is heading for a general election next year, and many see the move as an attempt to show the government’s ability to avoid austerity programs and to act without outside help.

In 2008, amid the global crisis Hungary was saved from bankruptcy with a $26 billion rescue package from the IMF and the EU. Two years later Prime Minister Viktor Orban’s government decided not to renew the deal to avoid closer IMF scrutiny of its economic policies.

However, in 2011, Economy Minister Matolcsy turned to IMF for a precautionary deal but didn’t get any reply.

In February 2013 Prime Minister Orban issued the country’s first international bond since 2011, thus demonstrating the country could go it alone by borrowing on global financial markets.

Relations between Orban’s government and the IMF have always been strained. In 2010, when Orban came to power, his government issued new laws, which were criticized as curtailing democracy, the justice system and freedom of speech.
 
The European Parliament responded with a resolution calling on Hungary to repeal the “anti-democratic changes.”

Hungary still owes $2.125 billion to the IMF from its original credit line of $25.5 billion. – RT: Hungary asks IMF to leave the country after early payback



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2 Comments

  1. I think Hungary is doing the right thing. More country’s should do this to break the yoke of the IMF which is just another corrupt arm of the U.S..

  2. Not doing business with the IMF and issuing their own bonds. Looks like Hungry will be added to the list of countries that will be hit with an Arab spring overthrow. Either that or Prime Minister Orban will be going bye bye.

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