Hungary Spends €4.6 billion to Keep Companies Alive

The Government in Budapest could give companies in Hungary affected by the recession guarantees and loans amounting to 1,400 billion forints (4.59 billion euro) to help them survive. This is in addition to the 2,100 billion forints (6.8 billion euro) invested in relaunching the economy and 46 billion forints for the reduction of debt, said Sandor Burany, the ministry of economy of Hungary.

Burany said that companies could access these funds until 2010, under the equivalent of 560 billion forint is already available in the form of loans and guarantees. Injections of 46 billion forints designed to halt the wave of layoffs will include the financing of 30 billion forints from the European Union, said Burany.

Most affected were the banks that have suffered from lack of liquidity in the system, capital markets, which investors have felt out of the system and currency. On the background of strong forint depreciation, the majority of Hungarians that in recent years have contracted loans in foreign currency, particularly in Swiss francs, risk to get in disability of payment