Tag Archives: Azeri economy

Viktor Orbán and his entourage in Baku

Not so long ago I wrote about Viktor Orbán’s fallacious theories regarding the direct connection between economic growth and authoritarian regimes. He looked at some of the countries that had plenty of gas, oil, and in some cases minerals and attributed their economic success in recent years to the nature of their regimes instead of to their natural resources. Ever since he became prime minister in 2010 he has been shamelessly courting the dictators or autocrats of these countries, only to discover that some of them are currently in deep economic trouble. One of these countries is Azerbaijan. I will not go into the details of the shocking deal Orbán made with President Ilham Aliyev concerning the fate of an Azeri murderer who was serving his sentence in a Hungarian jail. Anyone who’s interested in the particulars can find plenty of information on this blog.

At one point Orbán was even hoping that Hungary would issue bonds in Azeri currency, the manat, but the idea died a quiet death. And a good thing it did since the manat, which was worth 350 forints in January 2015, today trades at only 182 forints. Azerbaijan is in a deep recession (3.3%) with a 12% deficit and an inflation of 14%. I read somewhere that it is unable to pay for military equipment it ordered from Russia and the Russians are getting antsy.

Hungary, however, remains a steadfast ally of Azerbaijan. Not only did Viktor Orbán, his wife, and practically half of the Hungarian cabinet visit Aliyev in Baku, but it was announced during the trip by Foreign Minister Péter Szijjártó that the Hungarian Export-Import Bank has opened a $200 million line of credit to Azerbaijan to expand bilateral economic cooperation with Hungary. Aside from this announcement, the Hungarian media couldn’t discover any earth shattering reasons for the trip, certainly nothing concrete regarding “bilateral economic cooperation.” Although Viktor Orbán tried to give the impression that Azeri-Hungarian trade has soared since the Orbán government decided to treat Azerbaijan as a “stable partner, ally, and friend” of Hungary, the truth is that Hungarian exports to Azerbaijan today are only slightly above where they were in 2009. In fact, between 2010 and 2012 they decreased dramatically. Azeri exports to Hungary during the same period were flat.

Members of the cabinet nonetheless keep insisting that Azeri-Hungarian bilateral economic cooperation will be important to Hungary’s economy. Mihály Varga, minister of economy, spoke fleetingly about cooperation in the energy field, pharmaceuticals, and healthcare. Varga went on to emphasize Azerbaijan’s fantastic development in the past few years and stressed that the country is “the most important partner” in the South-Caucasian region. Which is not to say much. Hungarian exports to Azerbaijan amounted to a mere $65 million. Sándor Fazekas, minister of agriculture, chimed in, claiming that “Azerbaijan is the most promising agricultural partner of Hungary” because “since 2012 our exports to the country have quadrupled,” but, again, given the low level of trade volume that doesn’t mean much.

The Hungarian politicians felt obliged to say something about the changed circumstances of the Azeri economy. As Szijjártó cryptically put it, “we must place Azeri-Hungarian economic cooperation in a different dimension.” A Mandiner opinion piece sarcastically remarked that the “new dimension is the $200 million line of credit extended to Azerbaijan.”

Every time Orbán visits a country that is not exactly a democratic paradise the Hungarian media, with the exception of sycophantic publications like Magyar Idők, Magyar Hírlap, and Pesti Srácok, point out Orbán’s servile gestures toward his hosts. This trip was no exception. Csaba Káncz, formerly an advisor to the European Union, wrote that Orbán’s trip to Azerbaijan will not produce any tangible results,“it will [only] bring shame to the country.” One of the reasons for this shame is that Orbán and his wife lay a wreath on the grave of Heidar Aliyev, father of the current president of Azerbaijan, and his wife, Zarifa Aliyeva. The elder Aliyev’s political career was infamous. As first secretary of the Azeri communist party he ruled the country uninterrupted between 1969 and 2003 when he appointed his son to be his successor. Since 1995 there has been not one free election in the country. The last election, in 2014, was so free and fair that the results were announced the day before the actual election. Currently there are more than 100 political prisoners in Azerbaijan.

Led by Viktor and Anikó Orbán the Hungarian delegation is visiting the grave site of Heidar Aliyev and his wife

Led by Viktor and Anikó Orbán, the Hungarian delegation visits the grave site of Heidar Aliyev and his wife

In light of Azerbaijan’s dictatorship (in force ever since 1920) it was jarring that the Hungarian prime minister praised “the leaders of the country who have made Azerbaijan one of the most respected and often envied countries in the world.” People rarely appreciate the success of others, but sooner or later hard work brings triumph, and of late Azerbaijan’s “weight and prestige have grown.” Looking at it from the vantage point of Europe, Azerbaijan is successful and “committed to cooperation between East and West.” Surely, Orbán didn’t want to say much about Azerbaijan’s current economic and financial woes. He merely suggested diversification, in which “Hungary can be a useful partner” and which will make Azerbaijan even more successful and stronger.

A pilgrimage to the grave of the elder Aliyevs wasn’t enough groveling before the Azeri dictator. Viktor Orbán decided to honor the wife of the president, Mehriban Aliyeva, who serves as chairperson of the Aliyev Foundation named after Heidar Aliyev, by conferring on her the Commander’s Cross of the Order of Merit. And then the Hungarian entourage packed up and left. Another pretty useless and very expensive trip.

March 7, 2016