WHO IS GORDON BAJNAI?
A career businessman, Bajnai, 41, has been a friend of the outgoing prime minister, Ferenc Gyurcsany, since the early 1990s. He worked in the 1990s at brokerage CA-IB under Andras Simor, the central bank governor, before becoming CEO at investment firm Wallis Rt. Politically unaffiliated, Bajnai came into the cabinet in 2006 and served in various posts, most recently as economy minister.
HOW DID HE BECOME THE NEW PM?
Gyurcsany has presided over a minority government for the past year. He could no longer guarantee backing for his programme after the crisis hit and Hungary became the first EU state to seek IMF aid. He stepped aside in favour of a crisis manager and initiated a constructive vote of no confidence, a legal formula which allows the selection of a new premier by parliament and avoids an early election which had the potential to be devastating for his Socialists. The Free Democrats, whose votes are needed for a majority, came on board because they believed an early election would waste precious time.
CAN HE SUCCEED WHERE OTHERS FAILED?
Bajnai starts from a better position than where Gyurcsany left off, but some of the same constraints also apply to him.
He is non-partisan but still needs Socialist support so he cannot remain outside the party's internal disputes. To keep the party's backing, he will have to include some party stalwarts in his cabinet, which could limit his ability to act.
Bajnai does not plan to remain in politics once his term is up next year, so he will be less affected by public anger that will almost certainly be triggered by his spending cuts. But the Socialists will have an eye on an election in 2010.
The conservative opposition has already said it will not even sit down to talk to Bajnai.
WHAT ARE SOME OF HIS MAIN CHALLENGES?
Bajnai takes over an economy that is expected to contract by 6 percent this year and is kept afloat by a $25.1 billion IMF-led lifeline. Foreign investors are declining to finance Hungary's high budget and current account deficits, and the forint's weakness in recent months threatens hundreds of thousands of families who took out foreign currency mortgages.
Bajnai must cut spending to rescue the budget, keep within IMF guidelines and regain investor confidence, and he will face dissent from every possible side.
Handling the ruling Socialists may be his most difficult task. He needs their votes but a sizeable section of the party views Bajnai with contempt because cuts in welfare spending would erode the party's traditional voter base.
Analysts expect Bajnai to have limited time to act. The campaign for the spring 2010 election will get underway soon, cutting his influence.
WHAT ARE HIS KNOWN PRIORITIES?
Bajnai said pensions, public sector bonuses, maternity support, mortgage subsidies, energy subsidies and public transport subsidies must be cut.
He has said structural reforms are also important, but has not said where and how he plans to implement those. Substantial savings are possible in public administration, health care and education, but Bajnai has not detailed plans in those areas.
He has declared priorities only on spending cuts and has not released the rest of his programme.
