Hungary's premier offers to resign
Cites criticism he is 'obstacle' to needed change
BUDAPEST - Hungary's prime minister stunned the country yesterday by announcing his resignation because he had become an "obstacle" to the reforms needed to pull the country out of its worse financial crisis since the end of communism nearly 20 years ago.
Ferenc Gyurcsany, of the ruling Socialists, made the unexpected announcement at his party's congress, saying that he was keeping a pledge he made in January last year to change the leadership if the embattled party's popularity failed to recover.
He accepted that his reputation was badly damaged when state radio in 2006 broadcast a speech he made at a party meeting in which he admitted lying about the state of the economy to win elections a few months earlier. The broadcast sparked weeks of protests and riots that left hundreds injured.
"I'm being told that I myself am the obstacle to the cooperation and stable government majority needed to implement changes," Gyurcsany told party members. "If this is so, I will eliminate this obstacle."
He said a year had passed since he made his promise. "Support for us has not grown. On the contrary, it has diminished," Gyurcsany said. "I propose forming a new government with a new prime minister."
Gyurcsany, however, seemed to be hedging his bets.
Just hours after saying he was ready to resign as prime minister, he was reelected chairman of the Socialist Party with over 80 percent of the votes, giving him a say in choosing his possible successor, who would then be proposed to parliament for a vote.
Analysts said Gyurcsany's announcement could be a ploy to strengthen his position within the party, which is expected to do badly at June's elections for the European Parliament.
"It is not clear whether his true intention is to give up his place . . . or whether he simply wants to show that there is no alternative to him," said Orsolya Milovan of the Perspective Institute, noting that Gyurcsany did not mention any candidate who could replace him.
Instead of early elections, lawmakers are likely to chose a new prime minister who will name a new government to be in place until parliamentary elections scheduled for mid-2010.
Fidesz, the main center-right opposition party, said it was not willing to participate in talks to find Gyurcsany's replacement and would instead initiate the dissolution of parliament and propose holding early elections.
"The Socialist government is the country's disgrace and early elections are in the country's interest," the Fidesz party, led by former Prime Minister Viktor Orban, said in a statement.
Hungary has been badly hit by the global financial crisis and has received a $25.1 billion loan from the International Monetary Fund and other institutions.
Investors' confidence about the country's ability to meet debt payments has substantially weakened the forint, the Hungarian currency, preventing the central bank from lowering interest rates to help boost the economy, which is expected to shrink by as much as 5 percent in 2009.
Gyurcsany said that he will officially notify parliament of his decision tomorrow and called for a meeting of his party in two weeks to choose a candidate to head the new administration.
Parliament could elect the new prime minister on April 14, state news agency MTI reported, citing unnamed sources in the Socialist Party. 