LONDON (Standard and Poor's) Oct. 4, 2005--Standard&Poor's Ratings Services said today that it affirmed its 'A-/A-2' long- and short-term sovereign credit ratings on the Republic of Hungary. The outlook remains stable. The ratings on Hungary are supported by its well-diversified economic and export structures, and levels of wealth and growth prospects in line with the 'A' median. The ratings remain constrained by high fiscal deficits and debt levels, and the economy's vulnerability to unfavorable external and domestic developments. "The general government deficits on an ESA95 basis--including the costs of pension reform, and assuming the extensive motorway investment program is fully implemented--could surpass 7.0% of GDP in 2005 and 2006. This is considerably higher than the government's initial targets,
