In Hungary, Potential Lessons for Greece

Hungary is looking to adopt the Euro, despite recent problems dealing with Greece. Even though they became part of the European Union in 2004, they still have conditions to meet before they can adopt the Euro. In addition to Hungary, Latvia, Poland and Estonia also would like to adopt the Euro as their currency. In 2008, Hungary had to be bailed out by the IMF, which set restrictions in order to get Hungary back on their feet. This has drawn attention to the fact the the E.U. monetary fund cannot help bail Greece and other countries out, and that Greece, Spain, and Portugal should learn from Hungary. In order to adopt the Euro, labor costs need to decline, they need to build a stronger and bigger economy to compete with bordering countries and and have sustained growth equivalent to two percentage points above the E.U. average. One of the most important things to do is have a strong and constraint fiscal policy in Hungary.