In our view, the Republic of Hungary has a comparatively advanced economy and a large and competitive export sector. We believe, however, that measures to reduce the government deficit are not improving the sustainability of public finances. We expect government deficits to rise again from 2013, when temporary sectoral taxes expire, and in view of general elections in 2014. We are therefore affirming our 'BBB-/A-3' sovereign credit ratings on Hungary and maintaining the negative outlook. The negative outlook reflects our opinion that key components of the government's plan to consolidate public finances do not improve the government's structural deficit and could harm Hungary's medium-term growth prospects. On Nov. 3, 2010, Standard&Poor's Ratings Services affirmed its long- and short-term
