By Balazs Penz and Alex Kuli
Sept. 21 (Bloomberg) -- Hungarian rioters clashed with police on a third consecutive night of violence in downtown Budapest as demonstrations demanding the resignation of Prime Minister Ferenc Gyurcsany continued.
Riot police fired tear gas at a crowd of about 1,000 shouting protesters on a main avenue in the city center. Police earlier dispersed a smaller crowd that hurled beer bottles at them. The violence left 13 people injured and 55 arrested, said Eva Tafferner, a police spokeswoman. About 250 people were injured and more than 100 arrested in the first two nights.
The riots, the worst since the end of communist rule, were sparked by a leaked tape in which Gyurcsany admitted the Socialist-led government misled the public about the need to cut spending before April general elections. Police are preparing for more of the same.
``We are preparing with the necessary and the adequate power for tonight,'' Tafferner said in a phone interview today. ``The same way as in the previous three nights.''
Away from the clash, about 15,000 demonstrators gathered peacefully near the parliament building, demanding Gyurcsany's departure and new elections. He rejected calls to quit and pledged to continue his program and trim the deficit, the European Union's largest compared with the size of its economy.
Unpopular Measures
Gyurcsany three months ago announced measures, including higher taxes and increased prices for medicines, natural gas and electricity, aimed at reducing the budget deficit.
The measures were part of the reason people took to the streets, according to analysts including Gergely Hudecz of DZ Bank in Budapest. People are worried about their livelihoods and are angered by the contrast with Gyurcsany, one of the country's richest men, he said.
``They have to pay the price of the austerity measures, and they have a very rich prime minister, and that's very provocative,'' Hudecz said.
The past three days were the worst street violence in Hungary since the end of communism in 1989. Expressions of disappointment with the outcome of political changes included the blocking of a bridge in Budapest four years ago, and a blockade of taxi drivers that paralyzed traffic for days in 1991, though protests never led to violence.
1956 Uprising
Rioters invoked the memories on 1956, when Hungarians revolted against communist rule, fighting government and Soviet troops for weeks. Gyurcsany rejected the comparison, calling the events criminal acts, not a revolution.
The most violent rioters were known to the police, Magyar Hirlap reported, citing unidentified officials. The core was identified as supporters of Budapest soccer teams Ferencvaros and Ujpest, joined by members of right-wing groups Jobbik and the 64 Counties Movement, according to the newspaper.
The expletive-laden tape recording that sparked the protests was leaked to several media outlets on Sept. 17. Gyurcsany later published the full text in his Internet diary. He was calling for the start of a cleansing process in Hungarian politics, he said.
``We screwed it up, big time,'' Gyurcsany said on the leaked tape of the meeting. ``No country in Europe has been so blatant. We obviously lied throughout the past 1 1/2 to 2 years. And meanwhile, we didn't do a thing for four years. Nothing.''
Gyurcsany and Budapest Mayor Gabor Demszky yesterday urged police to crack down harder on protesters who have led two nights of rioting in the capital city. The mayor called the rioters criminals and urged the police to ``push them off the streets.''
`Extremist Elements'
``I won't be calm,'' said Demszky at the press conference yesterday. ``These extremist elements continued to wreak havoc on our city. They tried to occupy more public areas and to damage public institutions.''
The government today called the leaders of the five political parties in parliament to discuss the rioting, government spokeswoman Emese Danks said at a press conference in Budapest today. Opposition leaders refused to attend, MTI news agency reported.
Fitch Ratings yesterday cut the outlook on Hungary's credit ratings to negative from stable, citing the possibility that the protests and street violence may force the government to soften its austerity package.
``Recent developments have increased the chances that the government's much-needed reform program, spearheaded by the Prime Minister, will be diluted,'' David Heslam, a Fitch credit analyst, said in an e-mailed statement.
The forint fell to 275.90 per euro by 10:47 a.m. in Budapest from 275.11 late yesterday, its third consecutive day of decline. The country's benchmark BUX index fell 1.7 percent, also sliding for the third day.
Pope Benedict XVI, who yesterday met Hungarian pilgrims following the beatification of Sara Salkahazi last week, expressed concern over the situation unfolding in Hungary.
``I am monitoring the news from Hungary with worry,'' the Pontiff said in Hungarian.
To contact the reporter on this story: Balazs Penz in Budapest at bpenz@bloomberg.net .
Last Updated: September 21, 2006 05:32 EDT