High annual rates of inflation, deficits in the trade balance and accumulated foreign debts as well as low growth rates of national income and domestic consumption mark the situation of the Hungarian economy at the beginning of the 1980s. The annual price increase rate was 8.8% in 1979 and 9.1% in 1980, whereas there was an average annual price increase of 2.8% during the period 1971-1975. In 1978, the trade balance deficit in terms of US-$ reached a record high of more than 1.1 billion US-$. Hungary's net convertible currency debt amounted to more than 3 billion US-$, the annual interest payments exceeded the mark of 350 million US-S.