Abstract
HUNGARY
Title page
HUNGARY
STAFF REPORT FOR THE 2022 ARTICLE IV CONSULTATION—INFORMATIONAL ANNEX
January 17, 2023
Prepared By
European Department
In Consultation with Other Departments
Contents
FUND RELATIONS
STATISTICAL ISSUES
Fund Relations
(As of December 31, 2022)
Membership Status: Joined on May 6, 1982; Article VIII.
General Resources Account:
| SDR Million | Percent Quota | |
| Quota | 1,940.00 | 100.00 |
| Fund holdings of currency (Holdings | ||
| Rate) | 1,640.76 | 84.58 |
| Reserve tranche position | 301.18 | 15.52 |
| SDR Million | Percent Quota | |
| Quota | 1,940.00 | 100.00 |
| Fund holdings of currency (Holdings | ||
| Rate) | 1,640.76 | 84.58 |
| Reserve tranche position | 301.18 | 15.52 |
SDR Department:
| SDR Million | Percent Allocation | |
| Net cumulative allocation | 2,850.45 | 100.00 |
| Holdings | 1,855.92 | 65.11 |
| SDR Million | Percent Allocation | |
| Net cumulative allocation | 2,850.45 | 100.00 |
| Holdings | 1,855.92 | 65.11 |
Outstanding Purchases and Loans: None
Latest Financial Arrangements:
| Type | Date of Arrangement | Expiration Date | Amount Approved (SDR Million) | Amount Drawn (SDR Million) |
| Stand-By | Nov 6, 2008 | Oct 5, 2010 | 10,537.50 | 7,637.00 |
| Stand-By | Mar 15, 1996 | Feb 14, 1998 | 264.18 | 0.00 |
| Stand-By | Sep 15, 1993 | Dec 14, 1994 | 340.00 | 56.70 |
| Type | Date of Arrangement | Expiration Date | Amount Approved (SDR Million) | Amount Drawn (SDR Million) |
| Stand-By | Nov 6, 2008 | Oct 5, 2010 | 10,537.50 | 7,637.00 |
| Stand-By | Mar 15, 1996 | Feb 14, 1998 | 264.18 | 0.00 |
| Stand-By | Sep 15, 1993 | Dec 14, 1994 | 340.00 | 56.70 |
Projected Payments to Fund:
(SDR million; based on existing use of resources and present holdings of SDRs)
| Forthcoming | |||||
| 2023 | 2024 | 2025 | 2026 | 2027 | |
| Principal | |||||
| Charges/Interest | 28.76 | 29.05 | 29.02 | 29.04 | 29.04 |
| Total | 28.76 | 29.05 | 29.02 | 29.04 | 29.04 |
| Forthcoming | |||||
| 2023 | 2024 | 2025 | 2026 | 2027 | |
| Principal | |||||
| Charges/Interest | 28.76 | 29.05 | 29.02 | 29.04 | 29.04 |
| Total | 28.76 | 29.05 | 29.02 | 29.04 | 29.04 |
Current Status of Safeguards Assessment:
The safeguards assessment of the Magyar Nemzeti Bank (MNB) was finalized on January 28, 2009. The assessment found that the central bank had a relatively strong safeguards framework in place. The MNB’s control environment was well established, and the audit and financial reporting practices adhered to international standards. The assessment recommended measures to improve the process of program data reporting to the Fund and to strengthen audit oversight, especially over the central bank’s basic tasks. In recent years the central bank law was subject to numerous changes. Going forward, it is critical to avoid undue changes to the MNB’s legal framework and to ensure that the law continues to support MNB’s operational and legal independence.
Exchange Rate Arrangements:
Hungary’s de jure exchange rate arrangement is free floating, and the de facto exchange rate arrangement is classified as floating. Hungary has accepted the obligations of Article VIII and maintains an exchange rate system free of multiple currency practices and restrictions on the making of payments and transfers on current international transactions except for those maintained solely for the preservation of national or international security and that have been notified to the Fund pursuant to Executive Board Decision No. 144-(52/51).
Article IV Consultation:
Hungary is on a 12-month consultation cycle. The last Article IV Board discussion took place on June 18, 2021, on a lapse of time basis. The associated the staff report is available at https://www.imf.org/en/Publications/CR/Issues/2021/06/22/Hungary-2021-Article-IV-Consultation-Press-Release-and-Staff-Report-461121
Technical Assistance: See the table below.
Hungary: Technical Assistance from the Fund, FY2010–2022
Hungary: Technical Assistance from the Fund, FY2010–2022
| Department | Purpose | Date |
|---|---|---|
| MCM | Banking Supervision | June 2009 |
| LEG | Bank Resolution Framework | September 2009 |
| FAD | Expenditure Policy | October 2009 |
| MCM | Monetary Policy | February 2010 |
| FAD | Expenditure Policy | June 2010 |
| MCM | Financial Stability | July 2010 |
| FAD | Tax Policy | September 2010 |
| MCM | Financial Stability | November 2010 |
| MCM | Monetary and Foreign Exchange Policy | June 2011 |
| FAD | Fiscal Federalism | October 2011 |
| MCM | Monetary and Foreign Exchange Policy | November 2011 |
| LEG | VAT Fraud and Anti-Money Laundering Activities | January 2013 |
| LEG | Bank Resolution and Crisis Management | November 2013 |
| MCM | Operational Aspects of Establishing an Asset Management Company | January 2015 and June 2015 |
| FAD | Workshop on Revenue Forecasting and Micro-simulation Analysis | January 2016 |
| FAD | PIT and CIT Micro-Simulation | January 2018 |
| FAD | VAT Gap Analysis | February 2018 |
| FAD | Revenue Administration | January 2020 and February 2020 |
Hungary: Technical Assistance from the Fund, FY2010–2022
| Department | Purpose | Date |
|---|---|---|
| MCM | Banking Supervision | June 2009 |
| LEG | Bank Resolution Framework | September 2009 |
| FAD | Expenditure Policy | October 2009 |
| MCM | Monetary Policy | February 2010 |
| FAD | Expenditure Policy | June 2010 |
| MCM | Financial Stability | July 2010 |
| FAD | Tax Policy | September 2010 |
| MCM | Financial Stability | November 2010 |
| MCM | Monetary and Foreign Exchange Policy | June 2011 |
| FAD | Fiscal Federalism | October 2011 |
| MCM | Monetary and Foreign Exchange Policy | November 2011 |
| LEG | VAT Fraud and Anti-Money Laundering Activities | January 2013 |
| LEG | Bank Resolution and Crisis Management | November 2013 |
| MCM | Operational Aspects of Establishing an Asset Management Company | January 2015 and June 2015 |
| FAD | Workshop on Revenue Forecasting and Micro-simulation Analysis | January 2016 |
| FAD | PIT and CIT Micro-Simulation | January 2018 |
| FAD | VAT Gap Analysis | February 2018 |
| FAD | Revenue Administration | January 2020 and February 2020 |
Statistical Issues
Assessment of Data Adequacy for Surveillance
General: Data provision is adequate for surveillance.
Government Finance Statistics: The statistical authorities compile and disseminate comprehensive general government annual and quarterly accrual-based data according to the ESA 2010 methodology. The data include non-financial accounts, financial accounts, and financial balance sheet. These data are bridged into the GFSM 2014 framework and provided to the Fund through Eurostat for dissemination in the International Financial Statistics and the GFS yearbooks. However, there is some room to further improve how data is provided to the Fund to facilitate surveillance. Data on central government revenue and expenditure arrears as well as that on local government revenues and expenditures, and financial statements of state-owned enterprises have been readily provided to the mission team by the authorities upon request, but provision of this data on an automatic basis would facilitate the monitoring of obligations on an accrual basis and allow for closer regular monitoring of the general government.
Monetary and Financial Statistics: Monthly monetary data consisting of the central bank and other depository corporations which accords to the IMF’s Monetary and Financial Statistics Manual are reported by the authorities to STA databases. The source data are obtained through a gateway arrangement with the European Central Bank and are based on the ECB framework for collecting, compiling, and reporting monetary data. Hungary also reports several data and indicators of the Financial Access Survey (FAS), including mobile and internet banking, mobile money, and the two indicators (commercial bank branches per 100,000 adults and ATMs per 100,000 adults) adopted by the UN to monitor Target 8.10 of the Sustainable Development Goals (SDGs). Hungary doesn’t report gender-disaggregated FAS data.
Financial Sector Surveillance: Hungary reports 16 core and 5 additional Financial Soundness Indicators (FSIs) for DTs and two additional FSIs on real estate markets on a quarterly basis. The latest FSIs and metadata are available on the IMF’s FSI webpage.
External sector statistics: Hungary reports quarterly BOP and IIP statistics to the IMF’s STA on a timely basis and in line with the sixth edition of the Balance of Payments and International Investment Position Manual (BPM6). Hungary also participates in the semi-annual Coordinated Portfolio Investment Survey and the annual Coordinated Investment Survey, and disseminates monthly reserves data using the International Reserves and Foreign Currency Liquidity Template.
Data Standards and Quality
Adherer to the Fund’s Special Data Dissemination Standard (SDDS) Plus since July 2022.
Hungary published its original ROSC Data Module in 2001 and updates are available on the IMF website. The latest update is Hungary: Report on the Observance of Standards and Codes—Data Module, 2004 Update (July 2004).
Hungary: Table of Common Indicators Required for Surveillance
(as of January 13, 2023)
Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.
Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds. Daily data are readily available.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A); Irregular (I); Not Available (NA).
Reflects the assessment provided in the data ROSC and Substantive Update published in May 2001 and July 2004, respectively, and based on the findings of the respective missions that took place during January 2001 and January 2004 for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning (respectively) concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O), largely observed (LO), largely not observed (LNO), or not observed (NO).
Same as footnote 8, except referring to international standards concerning (respectively) source data, statistical techniques, assessment and validation of source data, assessment and validation of intermediate data and statistical outputs, and revision studies.
Hungary: Table of Common Indicators Required for Surveillance
(as of January 13, 2023)
| Date of latest observation | Date received | Frequency of Data7 | Frequency of Reporting7 | Frequency of publication7 | Memo Items: | ||
|---|---|---|---|---|---|---|---|
| Data Quality – Methodological soundness8 | Data Quality Accuracy and reliability9 | ||||||
| Exchange Rates | 01/12/2023 | 01/12/2023 | D and M | D and M | D and M | ||
| International Reserve Assets and Reserve Liabilities of the Monetary Authorities1 | December 2022 | 01/13/2023 | M | M | M | ||
| Reserve/Base Money | December 2022 | 01/04/2023 | M | M | M | O,O,LO,LO | O,O,O,O,LO |
| Broad Money | December 2022 | 01/13/2023 | M | M | M | ||
| Central Bank Balance Sheet | December 2022 | 01/13/2023 | M | M | M | ||
| Consolidated Balance Sheet of the Banking System | November 2022 | 01/04/2023 | M | M | M | ||
| Interest Rates2 | November 2022 | 01/04/2023 | M | M | M | ||
| Consumer Price Index | December 2022 | 01/13/2023 | M | M | M | O,O,O,O | O,O,O,O,NO |
| Revenue, Expenditure, Balance and Composition of Financing3 – General Government4 | 2021 | 09/21/2022 | A | A | A | O,LNO,LO,O | LO,O,O,O,NO |
| Revenue, Expenditure, Balance and Composition of Financing3– Central Government | November 2022 | 12/08/2022 | M | M | M | ||
| Stocks of Central Government and Central Government-Guaranteed Debt5 | Q3 2022 | 01/03/2023 | Q | Q | Q | ||
| External Current Account Balance | Q3 2022 | 12/22/2022 | Q | Q | Q | O,LO,LO,LO | O,O,O,O,NO |
| Exports and Imports of Goods and Services | Q3 2022 | 12/22/2022 | Q | Q | Q | ||
| GDP/GNP | Q3 2022 | 12/03/2022 | Q | Q | Q | O,O,O,LO | O,LO,O,O,NO |
| Gross External Debt | Q3 2022 | 12/22/2022 | Q | Q | Q | ||
| International investment Position 6 | Q3 2022 | 12/22/2022 | Q | Q | Q | ||
Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.
Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds. Daily data are readily available.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A); Irregular (I); Not Available (NA).
Reflects the assessment provided in the data ROSC and Substantive Update published in May 2001 and July 2004, respectively, and based on the findings of the respective missions that took place during January 2001 and January 2004 for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning (respectively) concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O), largely observed (LO), largely not observed (LNO), or not observed (NO).
Same as footnote 8, except referring to international standards concerning (respectively) source data, statistical techniques, assessment and validation of source data, assessment and validation of intermediate data and statistical outputs, and revision studies.
Hungary: Table of Common Indicators Required for Surveillance
(as of January 13, 2023)
| Date of latest observation | Date received | Frequency of Data7 | Frequency of Reporting7 | Frequency of publication7 | Memo Items: | ||
|---|---|---|---|---|---|---|---|
| Data Quality – Methodological soundness8 | Data Quality Accuracy and reliability9 | ||||||
| Exchange Rates | 01/12/2023 | 01/12/2023 | D and M | D and M | D and M | ||
| International Reserve Assets and Reserve Liabilities of the Monetary Authorities1 | December 2022 | 01/13/2023 | M | M | M | ||
| Reserve/Base Money | December 2022 | 01/04/2023 | M | M | M | O,O,LO,LO | O,O,O,O,LO |
| Broad Money | December 2022 | 01/13/2023 | M | M | M | ||
| Central Bank Balance Sheet | December 2022 | 01/13/2023 | M | M | M | ||
| Consolidated Balance Sheet of the Banking System | November 2022 | 01/04/2023 | M | M | M | ||
| Interest Rates2 | November 2022 | 01/04/2023 | M | M | M | ||
| Consumer Price Index | December 2022 | 01/13/2023 | M | M | M | O,O,O,O | O,O,O,O,NO |
| Revenue, Expenditure, Balance and Composition of Financing3 – General Government4 | 2021 | 09/21/2022 | A | A | A | O,LNO,LO,O | LO,O,O,O,NO |
| Revenue, Expenditure, Balance and Composition of Financing3– Central Government | November 2022 | 12/08/2022 | M | M | M | ||
| Stocks of Central Government and Central Government-Guaranteed Debt5 | Q3 2022 | 01/03/2023 | Q | Q | Q | ||
| External Current Account Balance | Q3 2022 | 12/22/2022 | Q | Q | Q | O,LO,LO,LO | O,O,O,O,NO |
| Exports and Imports of Goods and Services | Q3 2022 | 12/22/2022 | Q | Q | Q | ||
| GDP/GNP | Q3 2022 | 12/03/2022 | Q | Q | Q | O,O,O,LO | O,LO,O,O,NO |
| Gross External Debt | Q3 2022 | 12/22/2022 | Q | Q | Q | ||
| International investment Position 6 | Q3 2022 | 12/22/2022 | Q | Q | Q | ||
Includes reserve assets pledged or otherwise encumbered as well as net derivative positions.
Both market-based and officially-determined, including discount rates, money market rates, rates on treasury bills, notes and bonds. Daily data are readily available.
Foreign, domestic bank, and domestic nonbank financing.
The general government consists of the central government (budgetary funds, extra budgetary funds, and social security funds) and state and local governments.
Including currency and maturity composition.
Includes external gross financial asset and liability positions vis-à-vis nonresidents.
Daily (D), Weekly (W), Monthly (M), Quarterly (Q), Annually (A); Irregular (I); Not Available (NA).
Reflects the assessment provided in the data ROSC and Substantive Update published in May 2001 and July 2004, respectively, and based on the findings of the respective missions that took place during January 2001 and January 2004 for the dataset corresponding to the variable in each row. The assessment indicates whether international standards concerning (respectively) concepts and definitions, scope, classification/sectorization, and basis for recording are fully observed (O), largely observed (LO), largely not observed (LNO), or not observed (NO).
Same as footnote 8, except referring to international standards concerning (respectively) source data, statistical techniques, assessment and validation of source data, assessment and validation of intermediate data and statistical outputs, and revision studies.