Hungary's chance of reaching an agreement on a financial backstop from the International Monetary Fund and the European Union has diminished as positions have stiffened, Mihály Varga, Hungary’s chief negotiator said in an interview published in business daily Napi Gazdaság on Friday.

"The Government has to take into consideration not only the economic aspect but also political and social policy points of view, while the IMF is concentrating mainly on its economic policy decisions," he added. Minister Varga said a government media campaign launched in October that sent the message Hungary would not make big sacrifices to get financial assistance from the IMF/EU came as a "surprise" to the IMF. "The IMF had practically never run into this kind of thing. They found it difficult to evaluate," he said. "The campaign mainly served to inform and reassure the Hungarian public. It was not against the IMF, rather it supported an agreement," he added. Asked about the urgency of reaching an agreement with the IMF/EU on the financial backstop, Minister Varga said liquidity on international markets was sufficient for the Hungarian state to finance itself "for the time being".
Minister Varga said he thought the change in management at the National Bank of Hungary (NBH) next spring would positively affect the IMF/EU agreement as well as monetary policy.

"The opportunity will arise to meld monetary and fiscal policy, so they are in harmony with each other," he said. Naturally, this will not be a perfect harmony, since the two actors, have different viewpoints, he added. Asked whether he would like to become finance minister or central bank governor, Minister Varga said he had not received such requests but would not take the post of central bank governor even if asked. The mandate of NBH governor András Simor, ends on March 2, 2013, while the mandate of one of his two deputies ends in the same month.

(MTI, Minister without portfolio)