Assessment on Hungary joining the Eurozone



Фаркашди С.А. студент-магистр Международный Финансовый Факультет Финансовый университет при Правительстве Российской Федерации Россия, г. Москва

ASSESSMENT ON HUNGARY JOINING THE EUROZONE

Hungary, my home country, has joined the European Union on the 1st of May, 2004. A long time has passed since then, with both positive and negative aspects, challenges and solutions, stagnation and growth. Many people argue about the European Union being a healthy, well-working mechanism, but in my opinion one thing can be said for sure: Hungary has gained more than it lost from the integration with the European Union. I could not help but notice, however, that Hungary has not yet adopted the common currency, Euro, although it has an obligation to do so. In the course of my scientific research project I have evaluated, how reasonable would it be for Hungary to adopt the Euro, its pros and cons and when should it be done, if ever.

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The results of my research were the following. From its beginnings, the flaws in the design of the common currency were pointed out by a number of economists. And indeed, this common currency is very far from being perfect. So it comes as no surprise that according to many experts, after more than 10 years as a member of the European Union, Hungary is still in no hurry to adopt the euro as it is enjoying the "advantages" of being outside the 18-country group. [2] Hungary still uses its currency, the forint but now a move to the single currency is no longer of "immediate interest," according to the Hungarian government's international spokesperson, Zoltan Kovacs. [2] As many experts note, not being members of the euro zone at the moment has advantages for the country. Taxation policies really help the economy, and the government is trying to utilize that for the best in policy making. Thus, joining the Eurozone is not an immediate interest of the country, because the economy, the structures that are running need to be up to a standard that would make it beneficial for the country to join. Government officials point out that there is currently no fixed target date for the country to join the euro area. Currently the Hungarian forint market is a very liquid fast-moving market. One can exchange his euros and dollars into forint very easily, even in big sizes. So, personally, I don't see it having a huge impact, if Hungary would to change into Euros. In my opinion, the country should wait for a more optimal period and use the advantages of having a personal, own currency for its own good. Hopefully, this way it will be less harmed by economic and financial fluctuations and can continue the positive growth tendency it has started in 2014.