Economy
ANALYST VIEW - JP Morgan says Hungary MPs unlikely to vote against themselves on Friday
Opposition parties took 53% of the overall vote in Sunday's municipal elections, compared with just 38% for the government coalition, and won 18 out of 19 counties.
Nóra Szentiványi of JP Morgan, however, underlined that the government's liberal candidate (Gábor Demszky) managed to hold on to the Budapest mayor post and the ruling parties also maintained a majority, albeit a narrow one, in the Budapest council.
Following the announcement of the results, President László Sólyom stated that only parliament had the power to restore the required social confidence. “Prime Minister Ferenc Gyurcsány has logically responded by calling a confidence vote in his government for Friday," the analyst said.
“We expect Gyurcsány to survive the confidence vote, which would send a positive message to markets with regard to the implementation of the fiscal stabilization package," Szentiványi noted.
Governing parties have a comfortable 55% majority in parliament and they have already reiterated their full support for the prime minister following the election defeat. Also, according to Hungarian law the prime minister can only call a confidence vote in the government as a whole, not individuals (i.e., himself).
“As such, by voting ‘no' on Friday, government MPs would effectively be voting for their own resignation," Szentiványi added.
Indeed, many Socialist Party MPs also hold ministerial positions in the cabinet (e.g., finance minister Veres, labor minister Kiss, education minister Hiller, defense minister Szekeres).
The opposition could initiate a no-confidence vote in the prime minister, but this would need to be constructive, which means that after voting down Gyurcsány they must also nominate a new PM, who must then be approved by a majority in parliament.
“The opposition does not have enough seats to succeed in such an attempt."
Opposition leader Orbán has now given an ultimatum to all parties for a no-confidence vote to be held until Thursday 1pm, otherwise he will call a mass rally outside parliament for Friday.“Political noise is thus set to remain high until the end of the week," the analyst added.
Nóra Szentiványi of JP Morgan, however, underlined that the government's liberal candidate (Gábor Demszky) managed to hold on to the Budapest mayor post and the ruling parties also maintained a majority, albeit a narrow one, in the Budapest council.
Following the announcement of the results, President László Sólyom stated that only parliament had the power to restore the required social confidence. “Prime Minister Ferenc Gyurcsány has logically responded by calling a confidence vote in his government for Friday," the analyst said.
“We expect Gyurcsány to survive the confidence vote, which would send a positive message to markets with regard to the implementation of the fiscal stabilization package," Szentiványi noted.
Governing parties have a comfortable 55% majority in parliament and they have already reiterated their full support for the prime minister following the election defeat. Also, according to Hungarian law the prime minister can only call a confidence vote in the government as a whole, not individuals (i.e., himself).
“As such, by voting ‘no' on Friday, government MPs would effectively be voting for their own resignation," Szentiványi added.
Indeed, many Socialist Party MPs also hold ministerial positions in the cabinet (e.g., finance minister Veres, labor minister Kiss, education minister Hiller, defense minister Szekeres).
The opposition could initiate a no-confidence vote in the prime minister, but this would need to be constructive, which means that after voting down Gyurcsány they must also nominate a new PM, who must then be approved by a majority in parliament.
“The opposition does not have enough seats to succeed in such an attempt."
Opposition leader Orbán has now given an ultimatum to all parties for a no-confidence vote to be held until Thursday 1pm, otherwise he will call a mass rally outside parliament for Friday.“Political noise is thus set to remain high until the end of the week," the analyst added.
