Hungary Needs Streamlining To Offset Disadvantage - MOL CEO

If Hungary continues to fail in implementing structural reforms, its growing regional disadvantage will prove lasting, president and chief executive officer of energy firm MOL Nyrt (MOL.BU) Zsolt Hernadi said.

Hungary has a tradition of trying to solve its problems with sweeping measures, that never prove effective and are followed by a period of depression, Hernadi said Thursday at a conference.

Hernadi noted that the Hungarian government's special taxes on profitable industries and additional burdens for the banking sector only show a desperate need for central revenues. However, if a system is unable to make itself more efficient as Hungary has failed to achieve in the past 20 years, and takes rash measures to raise revenues, it creates a distorted economic environment, he added.

Hernadi said that the government approach of finding overnight solutions is perceived negatively by the private sector, and this will have unfavorable consequences since economic growth can only be achieved through the involvement of profit-based capital.

-By Gergo Racz, Dow Jones Newswires, [phone];

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