Home News Hungarian parliament elects new PM to manage crisis

Hungarian parliament elects new PM to manage crisis

Published on 15/04/2009

Budapest — Hungarian lawmakers Tuesday voted in economy minister Gordon Bajnai as its new prime minister, charged with steering the country out of its deep economic crisis.

As thousands gathered outside the parliament to protest Bajnai’s appointment, repeating calls for early elections, the 41-year-old economist vowed results in just a year.

Shortly afterwards, several hundred protesters clashed with police, who said they "tried to break through the fences around parliament and threw different kinds of objects at policemen."

Police responded with tear gas grenades and arrested nine protesters, as nearby demonstrators set fire to a European Union flag, before spitting and urinating on it.

Elected by a clear majority to replace Ferenc Gyurcsany in a so-called "constructive no-confidence motion," 204 deputies of the 386-seat parliament voted in favour of ousting Gyurcsany. There were no dissenting votes and eight abstentions.

The motion, tabled by Gyurcsany’s own Socialist party, was a way for Socialist and their former allies, the Liberals, to vote out the deeply unpopular premier and vote in a successor without snap elections.

Neither party wanted a fresh election as they are lagging in opinion polls.

"My only goal is that a year from now, Hungary will be in better shape," Bajnai said during the parliamentary session, agreeing to receive a symbolic salary of just one forint during his term in office.

His government only has a year before the next general elections scheduled in spring 2010.

Opposition party Fidesz, flying high in polls, snubbed the vote, insisting that early elections was the only way to re-establish confidence.

Outside the parliamentary building, right-leaning civil associations, including the paramilitary Hungarian Guard, called for the complete dissolution of parliament and early polls, slamming Bajani as the "traitor of the nation."

Hungarian news agency MTI put the number of demonstrators at around 8,000, but the figure was not confirmed by police.

Gyurcsany announced his resignation on March 21, after failing to secure support for his unpopular reforms in the crisis-hit country, whose economy is expected to shrink by up to six percent this year.

Hungary has been one of the countries hardest hit by the global economic crisis and averted financial meltdown only with a hefty lifeline provided by the International Monetary Fund, European Union and World Bank last October.

In exchange, Hungary pledged to cut back on state expenses to reduce the public deficit.

While Bajnai is seen as a close friend and ally of Gyurcsany, he is not a member of the socialist party and named six new independent experts to his cabinet, taking up key portfolios such as the finance and economy ministries.

At the finance ministry, Peter Oszko, head of the Hungarian branch of Deloitte, is taking over from Janos Veres.

Tamas Vahl, IT expert and chairman of the German-Hungarian Chamber of Commerce, was named economy minister and Peter Balazs, Hungary’s first EU Commissioner, is to replace Kinga Goncz as foreign minister.

The agriculture, defence, environmental protection, culture, health care and internal affairs portfolios will however remain unchanged.

Pledging to take immediate action in crisis management, rein in public deficit, relaunch economic growth and regain investor confidence, Bajnai said he would reveal the details of his "painful" austerity plans once his cabinet had held its inaugural meeting later this week.

Some of the proposals have already been leaked, however, after Bajnai circulated a letter to Socialist and Liberal deputies beforehand, insisting they sign up to his belt-tightening as a condition of his taking office.

The proposals include a two-year wage freeze for civil servants and the abolition of the traditional 13th month salary for the public sector.

Bajnai also plans to scrap various welfare and family subsidies and raise the retirement age.