IMF begins delayed aid talks in Hungary

(BUDAPEST) - An International Monetary Fund team began talks in Budapest Tuesday about Hungary's request for a 15-billion-euro ($18.4 billion) credit line following months of delay, state media reported.

Representatives from the European Union were due to join the talks which are expected to last around a week, from Wednesday, state news agency MTI said.

Right-wing Prime Minister Viktor Orban first approached the IMF and the EU for help last year after Hungary's currency, the forint, fell sharply and the EU member state's borrowing costs on financial markets soared.

Investors were spooked by a number of unorthodox economic policies introduced by Orban's government such as the forced nationalisation of state pension assets. Hungary's sovereign debt was cut to "junk" status by credit rating agencies.

But talks with the IMF and EU broke down in December because of unease over a raft of new legislation, in particular a new central bank law that critics including the European Central Bank said endangered the lender's independence.

The government has since tweaked the central bank legislation, allowing talks with the EU and the IMF to resume.

On Monday, Hungary's highest court declared as unconstitutional legislation lowering the retirement age of judges that Brussels had threatened to sue Hungary over because of worries about the independence of the judiciary.