f_0023440_19182 - Privatization Helps: The Hungarian...

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Fall 2011 The Ambassadors REVIEW 31 Privatization Helps: The Hungarian Example Donald Blinken United States Ambassador to Hungary, 1994-1998 s Greece works out of financial crisis, it should look to Hungary fifteen years ago for part of the answer. Far too large a segment of the Greek economy remains locked up in public hands. Their sale to the private sector, as Hungarians discovered, while not a panacea, will help reduce catastrophic public debts, and salaries and pensions will become the responsibility of private owners rather than the government. The Greek Parliament’s austerity plan would raise 70 billion euros from privatization by 2015. The government will sell stakes in banking, airports, water utilities, motorway concessions, port operations, state land, and mining rights. Selling assets to the private sector will also improve managerial know-how, increase transparency, and encourage confidence in a Greek recovery. There is a precedent for this, although on a much smaller scale, in the similar challenges Hungary faced in the mid-1990s. In 1995, Hungary’s economy was in a dangerous free-fall. Its foreign debt, which Hungary had refused to disown after the fall of communism, was approaching $30 billion, the highest per capita debt in all of Central and Eastern Europe. A quick look at Hungary’s dilemma revealed that there was no easy
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This note was uploaded on 01/25/2012 for the course POLS 494 taught by Professor Garymoncrief during the Fall '11 term at Boise State.

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f_0023440_19182 - Privatization Helps: The Hungarian...

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