Hungary privately borrowed a record 1 billion euros from Chinese banks

In the spring of 2024, Hungary borrowed €1 billion from three Chinese banks, the largest loan in the country's history.

This is evidenced by the data of the Hungarian Debt Management Office, as cited by Politico.

Hungary fully utilized the loan provided by the China Development Bank, the Export-Import Bank of China, and the Hungarian branch of the Bank of China on April 19 and is due to be repaid within three years.

Budapest itself did not announce the deal - it only became officially known now after the publication of data from the government's debt office.

“The loan agreement allows, among other things, to finance investments in infrastructure and the energy sector. The agreement allows the ratio of public debt to GDP to be kept within the limit of 28.9%,” the statement said.

The agency did not disclose other details of the loan, including the interest rate and repayment schedule.

Hungary's record loan came amid a record increase in its public debt to 140 billion euros (73.5% of GDP) and a budget deficit of 6.7% of GDP, while the country has no access to EU funds due to the conflict with Brussels.

Author - Olena Madiak, 25/07/2024