Hungarian Prime Minister Ferenc Gyurcsany on Saturday proposed the establishment of a new government under a new prime minister in order to allow reforms to be approved.

Gyurcsany, current leader of the ruling Socialist Party, was re-elected as the party chief on Saturday during the two-day party congress, but he seems determined to give up the post of prime minister.

Gyurcsany told members of congress that the current situation requires "a wider political and social backing than today."

"I propose that we form a new government under a new prime minister," Gyurcsany said. He became prime minister in 2004 and won re-election in 2006.

Gyurcsany had planned to officially inform the parliament about his decision on March 23. He proposed that his party nominate a new prime minister at an extraordinary congress in two weeks time.

Gyurcsany said, by doing so, he was honoring a promise he had made early last year that he would step down if he failed to help regain the party's popularity.

"Support for us has not grown," he said. "On the contrary, it has declined."

The prime minister said he had been told he had become "an obstacle to the cooperation required for changes," and "if this is so, I will eliminate this obstacle."

Reports said Lajos Bokros, who served as finance minister from 1995 to 1996, has shown a desire to lead the government.

Hungary's governing social-liberal coalition broke down in April 30 last year, after the Free Democrats quit in protest against Gyurcsany's reluctance to support its economic reforms, leaving the Socialist to form a minority government.

Fidesz, the largest opposition party in the country, has since then called on the prime minister to resign and hold an early election.

The country has been hit hard by the global financial meltdown. Late last year, it secured a 25.1-billion-U.S.-dollar loan from the International Monetary Fund and other institutions.

Source: Xinhua