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3/22/06

Businessweek: Hungary to hold referendum on euro

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Hungary to hold referendum on euro

Hungary plans to hold a nonbinding referendum in 2008 on the adoption of the euro, the prime minister's spokeswoman said Friday. The referendum would be held after Hungary achieves the economic criteria needed to adopt the European Union's currency, said Boglar Laszlo, Prime Minister Ferenc Gyurcsany's spokeswoman. "We are talking about a 'sympathy referendum,'" Laszlo said. "The government is asking for society's support for its plans to adopt the euro." aszlo said that as of now the government's pledge to comply in 2008 with the criteria needed to adopt the euro "is the only thing set in stone."

Countries wishing to adopt the euro must meet limits on the size of the budget deficit and the inflation rate, among other economic indicators, for two years before being allowed to switch currencies. In theory, Hungary would be able to begin using the euro in 2010 if its economy stays within the limits set by the EU from 2008.

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