Hungary PM Proposes Setting Up New Government With New PM

Hungarian Prime Minister Ferenc Gyurcsany unexpectedly proposed to his Socialist Party on Saturday that they set up a new government headed by a new premier. The Prime Minister unveiled his proposal at a two-day Socialist Party Congress that started Saturday. Gyurcsany's minority Socialist government has faced street protests for years while it struggled to implement fiscal measures. Gyurcsany also proposed to the Socialist Party Congress that they hold an extraordinary congress in two weeks' time and name a new prime minister. State new agency MTI said Saturday that Gyurcsany is planning to call a no confidence vote against his government. Local news portal index.hu said that Gyurcsany offered his resignation to the leadership of the Socialist Party earlier Saturday, saying that his stepping aside may lead to a more efficient crisis management and reform process was necessary. In a speech delivered to the Socialist Party Congress, Gyurcsany admitted to having made several mistakes in his recent years as head of government and said his credibility had been severely marred by these mistakes. The unexpected resignation of Gyurcsany comes at a time when the government's popular support hit an all-time low and the country is facing an economic contraction this year. Gyurcsany's move is likely to shake domestic financial markets, which have been under selling pressure since October 2008, when the global financial crisis hit Hungary severely. The government was forced to secure a $25 billion credit facility from the International Monetary Fund, the World Bank and the European Union to secure the country's financing. Gyurcsany stressed that the government should continue the reform process.