ACCORDING to the  OECD's latest Economic Survey of Hungary, for durable recovery, the country needs to take swift action to stabilize its economy and put growth on a sound footing.The OECD report, shows that the fragile and highly-indebted Hungarian economy has been hit hard by the global slowdown and heightened financial market stress. It points out that controversial domestic measures have added to the uncertainty that is undermining business, household and market confidence.

An agreement with multilateral organizations for new financial assistance is a necessary step toward restoring confidence, the OECD said. The OECD has advised the Hungarian government to prioritize permanent spending cuts and structural reforms to boost growth. If additional revenues are needed, the least distortive taxes should be raised. Fiscal consolidation efforts should be shared fairly across Hungarian society.The report suggests that boosting labour force participation, particularly of under-represented groups, could be achieved by making it easier to combine work and families, better attuning the education system to labour market needs and reforming early retirement programmes.