Budapest’s bid for the 2024 Olympic Games is claiming it has received a significant boost to its plans by official confirmation of the growing strength of Hungary’s economy. This week ratings agency Moody’s has followed Standard and Poor’s and Fitch Ratings by upgrading their status for the country.
Budapest 2024 bid chairman Balazs Furjes said “an economy that is strengthening at a sustainable and steady pace equals a fiscally secure Olympic Games”.
The Moody’s report cites declining government debt burden, structural economic improvements that will “help sustain positive growth rates of 2-2.5 per cent in coming years”, and a “significant reduction in external vulnerability”. Standard and Poor’s also expect the nation’s economy to grow by 2.5 per cent in the next 12 months followed by at least five more years of similar stable growth.
According to a press release from the rating organization “Moody’s raised Hungary’s long-term foreign-currency bond ceiling to Baa1 from Baa2, and the long-term foreign-currency bank deposit ceiling to Baa3 from Ba2. Similarly, the short-term foreign-currency deposit ceiling was raised to P-3 from NP and the short-term foreign-currency bond ceiling was unaffected and remains unchanged at P-2.”
“Finally, the long-term local-currency bond and deposit ceilings were raised to Baa1 from Baa2.”
But Moody’s also offered a concern that “Hungary’s limited capacity to attract new foreign direct investment remains a challenge, reflecting weaknesses in Hungary’s non-cost competitiveness. Hungary’s ranking on the World Economic Forum’s Global Competitiveness Index dropped to an all-time low of 69th out of 138 countries in 2016, behind its regional peers.”
Budapest 2024 has made responsible financing of the Games one of the key platforms whey they announced their strategy in 2015, with support from both regional and national governments. Budapest 2024 says its Games concept has a focus on financial responsibility, security and affordability and minimized risk, while ensuring technically excellent fields of play and venues in experienced sport host cities full of atmosphere and celebrations.
Balazs Furjes said, “the bedrock of a resilient and stable economy, now confirmed by the world’s most influential credit rating organizations, means that we can ensure that the Budapest Games is financially sustainable in line with the IOC’s Agenda 2020.”
“We can make this pledge because we have a long term vision for the Games that is integrated into robust and well-established national economic development. Our business ecosystem offers a low cost base,with all the advantages of relatively affordable production costs alongside all the security of a low-risk environment”.
Furjez added, “this confirms to the world what we knew – that Hungary has the imagination and also the resources, the financial planning and the management experience and expertise to deliver on our bid’s commitment to plan and host an outstanding yet affordable Games”.
Budapest 2024 competitors for the 2024 Games are Los Angeles and Paris. The host city will be selected September 13, 2017 by the International Olympic Committee (IOC).