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European Union finance ministers have suspended Hungary’s access to half a billion euros in aid from next year for failing to keep its budget in check. Specifically, the country failed on its promise to keep its fiscal deficit below the 3% threshold set by the EU.
The punishment is meant to act as “a strong incentive for Hungary to conduct sound and sustainable fiscal policy,” according to EU Commissioner on Economic and Monetary Affairs, Olli Rehn.
If Hungary takes the required action by June, however, the suspensions will be lifted before actually becoming effective. Hungarian Finance Minister, Gyorgy Matolcsy, says he’s “fully convinced” and “[one] hundred percent confident” that the country will meet the EU’s requirements.
For more on this story, which we first wrote about a few weeks ago, check out Martin Denholm’s article.