Hungary’s neighbors: News from Slovakia and Romania

Before I tackle the newly released Jobbik election program I thought I would say a few words about two of Hungary's neighbors. What's going on in Slovakia and Romania. Not long ago, the common wisdom at least in Fidesz circles was that Hungary should follow the example of Slovakia and Romania. In Slovakia, according to Fidesz, everything was better; Slovakia was surpassing Hungary in every respect. In Slovakia, pensions are higher, the salaries of bus drivers are better, the country managed to introduce the euro–and look at Hungary. As for Romania, although it's true that Romania is still behind Hungary as far as living standards are concerned, the country is forging ahead so rapidly that very soon Romania will be better off than Hungary.

Lately the news from these neighboring countries is not so rosy. Although Hungarian unemployment is very high (10.5%) the Slovak figures are even higher, over 12% by now. Here is a good summary of unemployment figures in Europe. Just the other day I heard that Romania will let 100,000 people go from their large civil service corps because the Romanians have been unable to reduce their deficit as demanded by the IMF. Increasingly commentators are suggesting that the introduction of the euro might not have been entirely beneficial to the Slovak economy.

Here are some recent news items from Slovakia and Romania. Transparency International Slovakia conducted a survey lately according to which half of Slovakia's citizens perceive the courts in Slovakia to be corrupt. "Nearly every other Slovak considers bribery in courts and the prosecutor's office to be widespread." At least in Hungary it is not bribery that one is worried about in the courts and the prosecutor's office but political bias. Interestingly enough, distrust of the justice system has grown since 2006, that is since Robert Fico's government came to office. Mind you, Slovaks consider the parliamentary deputies, cabinet ministers and civil servants even more corrupt than the prosecutors and the judges. This unhappy state of affairs greatly resembles the Hungarian situation.

We all remember the upheaval concerning the H1N1 vaccine. Although a fair number of Hungarians eventually, however reluctantly, got vaccinated, who can forget the political fight over Omninvest, the manufacturer of the vaccine? But at least in Hungary the vaccine is available. In fact, the country is so well endowed with the vaccine that Omninvest is now selling its product abroad. In Slovakia the vaccine was not available until the very end of 2009. It was in mid-December that the head of the Public Health Office, the first person to be vaccinated, got the shot. It was on December 14 that Sanofi Pasteur, a pharmaceutical company, delivered the first 30,000 doses of the vaccine called Panenza. They promised another 20,000 by the end of the year while for January they promised 400,000-500,000 doses. I might add that by mid-December Slovakia had registered 860 cases of H1N1 flu and 18 deaths. Compare that to the Hungarian situation and the Hungarians should be grateful. But they are not.

Meanwhile Robert Fico is on a rampage again against the media. He recently accused the publishers of some of Slovakia's major dailies of plotting a unified campaign against his party. The publishers of course rejected his charges. They also complained about Fico's vulgar expressions which were inappropriate and insulting. Fico has a long history of verbal attacks against journalists. In 2008 Fico's government introduced a new press code that elicited much international criticism. Details can be found here.

In Romania, as I mentioned, the IMF is breathing down the neck of the new Romanian government because while at the beginning of 2009 the deficit was a little over 4% by the end of the year it had risen to 7.7% of GDP. According to the latest news an austerity program has begun in Romania. Wages and pensions are frozen. No stimulus package, no new investments are foreseen. The allotment to local governments from Bucharest was reduced by 10%; that means the loss of about 17,000 jobs. The central government must let about 80,000 people go. The agricultural sector will receive only 1.4% of the GDP and the Agrarian Trade Union announced that its members will organize a mass demonstration. Pensioners also threatened a strike, but it is hard to imagine what that strike would entail considering that they are not active wage earners.

As for the H1N1 virus, it didn't leave Romania untouched either but, as opposed to Hungary or even Slovakia, Romania still has no vaccine. Romania has had 82 deaths from the flu and 6,061 confirmed cases! And the numbers are growing. It seems that the vaccination program against the H1N1 flu for children (between the ages of six and fifteen) will start only in February. The vaccine is produced by an institute in Bucharest, but the vaccine has not yet passed all the necessary tests.

Perhaps the neighbors' pastures are not always greener.

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Interesting how simple economic and political news arrive so deformed in a neighboring country!
Romania has 800.000 people employed by the state that must be fired because we have close to double the number of people in the state apparatus compared to the other EU countries and the 100.000 people you mentioned are just the first step.
The world economical crisis is just an added incentive to start this reform now.
About the flu vaccine I really don’t know where you read the news because the problem here is exactly the opposite, many people refuse to take the vaccine even though its freely available for fear of counter reactions. More than that we just donated 400.000 units of the vaccine to Rep. of Moldova:


Indeed, the site confirms the fact that the problem in Romania is not a lack of vaccines but the lack of trust in the vaccine. Vaccination had started in November of 2009, by January 17 1,241,969 people have been vaccinated (of which 700,000 in January, probably after reflecting at the 111 deaths out of 6,838 cases).

Eva S. Balogh

Well, obviously one cannot trust Romanian Times where I read it.


Actually I think the number and ration of death cases very well reflects the horrific situation of the health care system and the general conditions of living of a significant part of the population in this not-so-long-ago economic miracle country. And with the IMF and the crisis more cuts will come…
Otherwise Romania and Slovakia was a beloved country of reference for “leftist” and reformist economists, the people like Oszkó or Bokros (Bokros I think still belives this fairy tale) and they used exactly the same way Éva criticizes in case of the Fidesz. And they knew and know equally little about the complex social and economic situation in these countries.

Eva S. Balogh

I’m not sure what Gabor is criticizing precisely, but I’ll tell you what my intention was when I wrote the piece. The Hungarian right always comes up with either Slovakia or Romania as examples to follow. The two countries where everything is just wonderful. I wanted to show that they also have plenty of problems.


Gábor: “Actually I think the number and ration of death cases very well reflects the horrific situation of the health care system and the general conditions of living of a significant part of the population in this not-so-long-ago economic miracle country.”
I think the situation reflects the state of mind of a large segment of the population (similarly to the USA), that is opposed to any vaccination.
Here is typical comment from the page I includede in my previous post:
Dear parents, I beg you from my heart to think twice before you get your children vaccinated! Ask your family doctor’s advice in case he or she is your friend and you trust them, consult a real priest in case you are Christians. A smart decision will save the clean body and soul of the biggest treasure: the child. God save the new generation! Amen.


The author forgot to mention that Hungary literally lives on borrowed money. The hungarian debt/gdp is 72.6 % in 2009 and the romanian debt/gdp is only 20%. Of course Romania could borrow money to pay for all these civil workers, but that would mean living on someone else’s money. Hungary’s tax ” AFA” is 25% while Romania’s tax is 19%. Hungary’s taxes on earned income can be more than 30% while Romania has a flat income tax of 16%. Romania has a bigger overall economy than Hungary but Hungaryhas a higher gdp per person . All that gdp is eroded by the massive debt/gdp ratio. For now hungarians live on borrowed money. When the bubble bursts like it did in greece, than the fun begins.

Eva S. Balogh

George: “When the bubble bursts like it did in greece, than the fun begins.”
Well, it almost did a year ago, in October. Then IMF’s help was needed. Now the country is in much better shape. In fact, Greece’s prime minister visited Hungary to learn some tricks in order to lower their budget deficit. But Hungarian government’s situation is easier, the Hungarians are more patient than the Greeks whose answer to the austerity program was a series of strikes.
As for the higher taxes in comparison to those of Romania the answer is simple enough: Hungarian employment figures are terribly low and therefore very few people pay taxes. People retire too early or they work in the gray and black economy. As long as so few people pay taxes one cannot lower the rates. Vicious circle, I’m afraid.

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