5 February 2013 Budapest

Greetings to all of you! Good afternoon, Ladies and Gentlemen!

At today's Business Forum, we greet a man, who has succeeded. Yes, I am speaking about the Prime Minister of Turkey. Today, we welcome to Hungary a man, who succeeded in bringing timely decisions to prevent his nation's economy plummeting into crisis and sharing the fate of European economies today. We are speaking about a man, we are greeting a man, who was brave enough to make difficult decisions. We would all like to be similar. Here in Hungary, we too are striving to achieve similar goals, but unfortunately with as yet less good results than you have managed to achieve in Turkey. The example of Turkey gives us reassurance and encouragement, because here is a country that tries to understand the future, determines its place in it, imagines how it could move forward in the future and then accomplishes it. In Europe, within the European Union, we have fallen out of the habit of applying this way of thinking. here, we talk little of leaders; we speak of institutions, procedures, methods and techniques.

Dear Guests!

The reasons this is so is because over the past fifty years the people of Europe have learned, and they had every reason to do so, that if economic difficulties arise, then our institutions, the institutions of the European economy, are flexible enough and innovative enough for the institutions to themselves adapt to the altered conditions without any need for significant changes in direction on the part of the leadership. For this reason, in Europe we have grown unaccustomed of speaking about leaders; we talk of the European Union, we talk of committees, of councils and all manner of procedure - we don't talk about leaders.

Ladies and Gentlemen!

The European economy is, however, currently experiencing a period when, as I see it,
the institutions that were previously capable of adjusting to new situations are unable to provide a solution to economic challenges without strong political leadership. If you read the speeches made by European leaders or writings on European policy, you will see that they are crying out everywhere for leadership and leaders. Let me add, in brackets: a little too late. In the case of Turkey, and the way we analyze the Turkish miracle - it is perhaps not an overstatement to call it that - we can see that your leaders already began adopting the policies that have by now made the Turkish economy the object of envy some ten years ago. You have achieved growth, while the European region is visibly shrinking when it comes to GDP.

Ladies and Gentlemen!

For Hungary, the lesson that can be learnt from Turkey's case is that every country should recognise its own situation, its own capabilities, and must face the challenges of the modern age with its own, made-to-measure economic policy, just a Turkey has done. We in Hungary are attempting something similar. Do not forget that here in Hungary over the past two and a half years we have created a new constitution, a new civil code, a new penal code and a new labour code. The life of every civilised state rests on these four codes of justice. Hungary has created these not in a decade or two decades, but in only two and a half years; and for this reason the Hungarian economy is also showing developments that give cause for confidence.

We Hungarians, Mr. Prime Minister, usually use six indices to describe our economy; we use these to try and ascertain if our economy is on track. We look at our government debt, which is showing a decreasing tendency in Hungary - we are one of only five such countries within the European Union. We look at our budget deficit, which must remain under the magic 3% mark, the European requirement. This is the third year that we have been under that limit in Hungary. We look at our employment indices: are there more ore less people in employment? Mr. Prime Minister, the number I am about to say is an important one, a serious indicator: there are one hundred and sixty thousand more people in work today in Hungary that there were two years ago. We look at our foreign trade indices, and our balance of payment data. These are all in order in Hungary. With relation to our foreign trade output and balance of payments, we occupy an excellent place on the podium behind Germany. The sixth index, ladies and gentlemen, is where our bicycle wobbles. Is it where the wheel gets thrown off course, to make life easier for the interpreter, and this is the field of economic growth. With regard to economic growth, the Hungarian economy is still far behind that of Turkey and remains behind that of most Central European countries.

Our plan is that 2013 will be the year when the sixth economic index will be put in order and rise to meet the five that are already on track. And this is why we are here today, honoured Ladies and Gentlemen, this is why I was glad to accept your kind invitation. Business, investment, trade, turnover, economic activity. And no matter how much we politicians would like to, we cannot operate a country's economy ourselves. A country's economy and economic relations between two countries are operated by you and people like you. All we can do is improve the conditions for this process, but you must conclude the business. You must create investment projects, you have to clinch deals and do business, and it is Turkish and Hungarian businessmen who must operate economic relations between our two countries. This is why we are here today, and I would like to encourage you to do business with us, to embrace Hungarian development projects, to come here and invest, and this is why I invite you to deepen economic relations between Turkey and Hungary.

Ladies and Gentlemen!

It is not easy to notice, but if one examines the history of Europe or takes a close look at a map of Europe, then he will see that there is a zone between German and Russian-speaking peoples; a significant piece of land that stretches from the Baltic Sea to the Adriatic. This is what we call Central Europe, and it is an extremely valuable region. It is valuable both in times of was, as testified to by many historical accounts, and it is also extremely valuable in times of peace. If you look at the European economy, you will see that if we make a prediction as to where there will be economic growth in Europe in the coming ten to fifteen years, then every analyst agrees that the greatest potential for growth lies in Central Europe. And so when we welcome you here in Budapest, we are not just welcoming you to Hungary, but also to Central Europe. We are now present in an economic region that has a good chance of becoming one of, if not the, most important zones within the European Union's economic area. And so those who come here and cooperate with us and invest, and the situation is similar not jus tin Hungary, but also in the Czech Republic and Poland, invests not only in these countries, but in Central European economies. The states of Central Europe are developing increasingly strong ties, we are consciously constructing trade routes, energy networks and infrastructure from Poland al the way down to Croatia. Accordingly,  this is a valuable region, and what we are offering you today is the opportunity for economic participation in it.

Ladies and Gentlemen!

We often say, and I think it has an element of truth, that the strongest countries aren't trying to manage the crisis, but are instead striving to transform themselves so that they may be competitive in the period following the crisis. It may sound harsh, but we Hungarians must compete with the economies of China, Brazil, and developing nations in general. Hungarian competitiveness no longer seeks to remain in proportion to German competitiveness, because German competitiveness and Western European competitiveness in general is something we have already achieved. But to increase exports even further we must exceed the level of competitiveness of even the developing nations. What is happening in Hungary today is nothing short of preparing Hungary for the next fifteen, twenty, twenty-five years. It is in this spirit that we launched the policy of opening towards the East. If you examine historical data on the economy, you will find that around 75-77% of Hungary's exports go to countries within the European Union. Hungary is a small country. It wasn't always so, and this might be the topic of another lecture; it the size it is. We were three times the size at one point, but this is no help in the current situation. Similarly, our economy was also three times the size it is today at one stage in history, but it is this size now. An in addition there was communism in Hungary, and the Turkish can thank their stars they didn't have to live through it. We had communism, which consumed capital and eradicated private ownership, so when democracy began in Hungary twenty years ago, there was no accumulated capital. Just think about it; a nation of ten million with no accumulated capital. This is how we began things twenty years ago, with a huge national debt on our shoulders. It is clear that only an export-orientated economy built on significant competitiveness can climb out of this trap.

This, Ladies and Gentlemen, is why is important that the goods we produce in Hungary find their way onto foreign markets. Because markets within the European Union are shrinking, our opportunities there are shrinking too. We are still fighting and are achieving good results, but on the whole the fact remains that the European Union will remain a shrinking market in the coming years. This is why Hungary, while sticking to its commitments towards NATO and the European Union, introduced the policy of opening towards the East, the point of which is that we would like to find business partners, relations, trade and markets in the world to the east of us. And we can only succeed in finding such markets and opportunities if we have partners. If there are countries that are willing, ready and able to cooperate with us. It is with great pleasure that I can say, your Prime Minister used engineering precision during today's press conference when he stated that we couldn't even find an issue that caused a problem in Turkish-Hungarian relations if we used a magnifying glass. This is a wonderful state of affairs. If our leaders are committed to Turkish-Hungarian economic relations, then these strong political foundations and a way of thinking that mutually respects the other's culture may form the basis for successful economic cooperation. The agreements this requires have been concluded today: we will introduce simplifications to the visa system, double the volume of trade between our two countries, acknowledge each other's diplomats, encourage our young people to study in each other's countries,  and place emphasis on maintaining a cultural presence in each other's countries. It maybe a slight exaggeration, but only a slight one, to say that I feel that today, we have done everything to ensure that Turkish-Hungarian economic relation develop in the best possible way in future. It is perhaps not an exaggeration to say, that the rest is up to You.

Thank you for your kind attention.

(Prime Minister’s Office)