Tag Archives: Ilham Aliyev

The “Azerbaijan Laundromat” and Orbán’s Hungary

News of the “Azerbaijan Laundromat” scandal reached Hungary yesterday, thanks to the report of Átlátszó, a group of investigative journalists who participated in an investigation conducted by the Organized Crime and Corruption Reporting Project (OCCRP). It was a truly international effort that included Danish, British, French, Swiss, Russian, Austrian, Slovene, Romanian, Bulgarian, Estonian, Czech, and American journalists. The first short description of this money laundering scheme appeared in The Guardian on September 2, from which we learned that the ruling elite of Azerbaijan operated a secret $2.8 billion scheme to pay prominent Europeans, buy luxury items, and launder money through a network of opaque British companies.

In The Guardian article there is no reference to Hungary, but Átlátszó reported that from this enormous amount of money $7.6 million landed in Budapest in 2012 and 2013. The first installment was deposited by Metastar Invest LLP, one of the four phony companies set up to expedite Azerbaijan’s money laundering operation, in July 2012. The recipient of this and subsequent deposits was Valesco International, a company that a couple of years later conveniently ceased to exist. Where the money actually ended up no one knows.

Let’s quickly recall Azeri-Hungarian relations in the first few years of the second Orbán government. Viktor Orbán was in Baku in September 2010, participating in an energy summit, but he had a separate meeting with President Ilham Aliyev. A year later President Pál Schmitt paid a visit to Baku, where he also conducted negotiations with the Azeri president. And on June 30, 2012, Viktor Orbán, while attending the Crans Montana Forum in Baku, again met Aliyev. A few days later, sometime in July 2012, the first installment of the Azeri millions arrived in Budapest.

What happened at this meeting? Most likely it was during this encounter that Viktor Orbán was persuaded to extradite Ramil Safarov, an officer of the Azerbaijani Army who had been convicted of the 2004 murder of an Armenian officer during a NATO-sponsored training seminar in Budapest. Safarov was sentenced to life imprisonment. The Azeri government approached successive Hungarian governments several times, trying to persuade them to allow Safarov to return to Azerbaijan so he could serve the rest of his sentence in his own country. The Hungarians refused because they suspected, with good reason as it turned out, that Safarov would be pardoned as soon as his plane hit the ground in Baku.

It is hard not to suspect a connection between Orbán’s visit to Baku in June and the first installment of $7.6 million to a Hungarian bank account in July, especially since by the end of August Safarov was on his way to Azerbaijan, where he was welcomed as a national hero and set free.

Of course, this is just conjecture, but what is clear is that the Azeri government used bribes to achieve its political aims and that those who were ready to serve Azeri interests were generously rewarded. The extradition of Safarov was certainly something that merited recompense as far as Aliyev was concerned. Ever since then, Azeri-Hungarian relations have been close. Aliyev remained a grateful friend and Orbán a loyal ally. One of my posts from 2014 describes in some detail the close relationship that developed between the two countries, which at times became outright embarrassing. For example, when Viktor Orbán during his last visit to Baku in 2016 talked about “the leaders of the country who have made Azerbaijan one of the most respected and often envied countries in the world.”

The Azeri leadership also spent a considerable amount of money on European politicians who were ready to defend Ilham Aliyev’s dictatorship. I will concentrate here on one politician who also had extensive dealings with the Orbán government. He is Luca Volontè, who was one of the largest beneficiaries of Aliyev’s “generosity.” Volontè at the time was the chairman of the European People’s Party group in the Council of Europe. Italian prosecutors allege that Volontè was paid €2.4 million by Azerbaijani officials in exchange for “his support of political positions of the state” at the Council, which is supposed to promote democracy and the rule of law. The accusation is actually not new. Gerald Knaus, chairman of the European Stability Initiative, a think tank, claimed as early as 2012 that “the Council of Europe … in recent years has been captured by autocrats.”

János Martonyi, Luca Volontè, and Viktor Orbán, March 28, 2012 / Orbán’s Facebook page

It is about this time that Viktor Orbán put a photo of himself with János Martonyi and Luca Volontè on his Facebook page. By that time, Volontè had proved to be a great friend of Hungary. In January 2011 the Council of Europe held a debate on the functioning of democracy in the country. Hungary was fiercely defended by several members of the Parliamentary Assembly (PACE), among them Volontè, who criticized the proceedings against Hungary on the ground of “a lack of facts.” Any criticism of the government inside of Hungary, he argued, comes from “people who are unhappy that they were not reelected.” Otherwise, Hungary is a model democracy.

Volontè’s close friendship with the Hungarian government continued. By 2013 he was again defending the Orbán government against the monitoring committee of the Council of Europe in connection with the new Hungarian constitution. He called the criticism of the Hungarian government a witch hunt. He claimed that the critics are not even familiar with the text of the constitution. Volontè explained all this in an interview with the then pro-government Magyar Nemzet.

By that time, Volontè was most likely a paid agent of the Azerbaijani government, and I wouldn’t be at all surprised if he also offered his services to the Orbán government, which was in considerable trouble both in the European Parliament and in the Parliamentary Assembly of the Council of Europe.

A year later I became even more suspicious when an ugly attack was launched in Hungary against Professor Charles Gati after the publication of his article “The Mask is Off,” which originally appeared in The American Interest and a day later in Hungarian Spectrum. It was written after Viktor Orbán’s infamous speech about building an “illiberal state” in Hungary. Orbán wasn’t expecting such a violent reaction to his honest admission of his plans, and the Fidesz media tried to distinguish between the American and the European understanding of the word “liberal.” It was at this point that Luca Volontè was called upon as a true “European voice.” He must have had considerable government help with his long article titled “Hands Off Hungary!” because he seemed to be too familiar with the Hungarian political scene at the time.

Volontè is no longer in politics. He is running the Novae Terrae Foundation, which “commits itself to defend human rights conceived according to natural law.” But he still has time to write long articles in praise of Viktor Orbán. The last such article appeared in Magyar Hírlap on March 18, 2016 with the title “Hungarian Spark: Prime Minister Viktor Orbán has the clear wisdom to outline the conditions of the epoch-making challenges ahead.” It is a propaganda piece which ends with this line: “I’m sure that I’m not the only one who can proudly say how good it is to meet true people and to know them as my friends, whom I hope to meet again in the country of St. Stephen soon.” Volontè’s wish was fulfilled because he visited Hungary in November 2016, giving a lecture on “The relativization of European values” at an international conference in Szeged organized by the Szeged-Csanád Bishopric and the Polish Consulate in Szeged. A few months later he was back in Hungary, this time for the World Family Summit held in May 2017, where he participated in a panel discussion on “Pro-family Activities in the World.”

This afternoon Magyar Idők published a surprisingly straightforward account of the Azeri bribery scheme with the title “Three-billion dollar fund for Baku’s plans: The threads reach the Parliamentary Assembly of the Council of Europe.” The $7.6 million deposited in a Budapest bank was of course omitted from the summary, but the article to my great surprise included a mention of Volontè as one of the accused. My question is whether these revelations will have any bearing on the currently overfriendly Azeri-Hungarian relations.

September 6, 2017

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

Another “strategic partnership”: This time with Azerbaijan, a model to follow

While we have been preoccupied with American-Hungarian and Russian-Hungarian relations, the dictator of Azerbaijan, Ilham Aliyev, arrived in Hungary for a visit, his third in four and a half years. Not too many high-level western visitors can be seen in Budapest lately, so Orbán must be satisfied with Azeri dictators and the like. Orbán himself is not welcome in western capitals, and therefore his official trips usually take him outside of the European Union and North America. He visited Baku twice, and I understand he will be going again to strengthen the “strategic partnership” he forged between Hungary and Azerbaijan, two countries that have a lot in common: both are extremely corrupt and both are led by autocratic leaders whom outsiders describe as mafia dons.

In September 2012 I wrote three posts (September 1, 2, and 3) on the Orbán government’s decision to release Ramil Safarov, an Azeri army officer, from the Hungarian jail where he was serving a life sentence for the brutal murder of an Armenian officer in 2004. The crime was perpetrated in Budapest, where both men spent a couple of months in a training program organized by NATO’s Partnership for Peace Program. The Azeri government made several attempts to convince the Hungarian authorities to release him into their custody. But because Safarov was considered to be a national hero the Gyurcsány and Bajnai governments, fearing that once Safarov stepped onto Azeri soil he would not spend a minute in jail, denied the requests. Not so the second Orbán government, which in the hope of Azeri goodwill and economic support decided to strike a deal with Aliyev, the Azeri dictator. To this day we don’t know what the Hungarian government got in return for the release of the “ax murderer,” as he is called in Hungary. According to rumors at the time, Viktor Orbán made the decision to extradite Safarov in exchange for the Azeri purchase of Hungarian bonds. The deal was struck under the watchful eye of Péter Szijjártó, and final approval came from Tibor Navracsics, the minister of justice who currently serves as one of the EU commissioners in Brussels. This dirty deal was the beginning of a great friendship between Aliyev’s Azerbaijan and Orbán’s Hungary.

Since then, the Hungarian government has manifested its commitment to closer economic and political ties between the two countries on several occasions. In November 2012 Hungary organized an “international conference” in Budapest to commemorate the 20th anniversary of the establishment of diplomatic relations between Hungary and Azerbaijan. In 2013 Hungary opened a Hungarian Trading House in Baku, and yesterday Viktor Orbán and Ilham Aliyev signed a “strategic partnership” agreement. Apparently this agreement encompasses the following areas of cooperation: energy, education, commercial air transport, tourism, veterinary medicine, and youth and sport. Currently trade between the two countries is insignificant and has actually been falling since 2010. Szijjártó himself talks about Azerbaijan only as a “potential economic partner” of Hungary, a partnership that will be realized once Azeri gas reaches Europe. For the time being, one hears only about the hundreds of scholarships offered by Hungary as a goodwill gesture toward these Central Asian countries. Azerbaijan just gratefully acknowledged 200 scholarships.

As usual, in the joint press conference after the meeting and signing ceremony, Viktor Orbán went overboard, praising Azerbaijan as an “example to follow” (mintaállam). By the way, when Orbán is confronted with foreign dignitaries, he is often visibly servile. He bows just a little too low, which in Aliyev’s case was accentuated by the Azeri president’s height and Orbán’s small stature. He did the same thing when the Chinese prime minister, Wen Jiabao, visited Budapest in 2011.

In his unbridled enthusiasm for the Azeri model, he even praised Aliyev’s father, Heydar Aliyev, the former KGB agent who became president of Azerbaijan after a military coup that overthrew the democratically elected president of the country in 1993. His and his family’s corruption was legendary. After his death in 2003, his son, the current president Ilham Aliyev, took over after a fraudulent election. Since then he has been reelected three times, and he can be assured that he will remain president of the country as long as he is alive: the law was changed that barred repeated reelection of the same person to the post. Wikileaks documents have revealed that American observers compared  the Azeri president to a mafia crime boss. Well, perhaps this is what Orbán had in mind when he spoke of Azerbaijan as an example to follow.

President Ilham Alyev and Prime Minister Viktor Orbán

President Ilham Aliyev and Prime Minister Viktor Orbán

In the afternoon there was an economic forum where Orbán made a speech in which he announced that “countries that have political systems that offer clear and unambiguous leadership to a given community are lucky,” indicating that he considers both Azerbaijan and Hungary among the lucky ones. Aliyev immediately picked up on Orbán’s remarks, adding that “both countries are led along a clear strategy. Hungary is defending its national interests, its independence, and its sovereignty.” How should one interpret Orbán’s reference to “clear and unambiguous leadership”?  I, for one, think that he means that in such a regime no opposition forces could possibly alter the strategy of an autocratic leader. This is certainly true of Aliyev as well as Orbán.

Today HVG posted a short note online teasing an article in its print edition tomorrow, according to which there might be “a thread that connects Baku and Budapest” in the U.S. banning of the six Hungarian officials and businessmen. According to the paper, the case involves corruption surrounding Hungarian government bonds offered for sale to Azerbaijan in 2012. My recollection is that the deal eventually fell through. The Hungarians were apparently hoping that Azerbaijan would pay Hungary back for its release of Ramil Safarov by buying Hungarian bonds through ARDNF, the Azerbaijan State Oil Fund. However,  ARDNF announced on October 9 that it had no intention of buying Hungarian bonds and that it did not plan to invest in Hungary. I still remember all the jokes on ATV about “manat,” the Azeri currency. However, there is always the possibility that some secret deal was struck over the Hungarian government bonds and that perhaps some of the money received disappeared either into Fidesz coffers or into individual pockets. The official announcement of ARDNF might have been intended simply to disavow any connection between the Safarov case and payments received by Hungary. We’ll have to see what HVG came up with.

And here is the latest. According to an unnamed Fidesz source, Viktor Orbán realized that he went too far in embracing Russia, ratcheting up his anti-EU rhetoric, and attacking the United States. According to this highly placed individual, Orbán is planning a change of orientation. From here on he will be a model of cooperation with his western allies. Well, his latest moves don’t support this reorientation. First, he just raised RTL Klub’s 40% levy to 50%, presumably to punish them for reporting negative news about the government on their very popular 6 o’clock news. This huge levy is a serious financial blow to RTL Klub, one that its German parent company, Bertelsmann, will have to absorb. Second, he wouldn’t call Azerbaijan “an example to follow” if he is preparing the ground for a change in his foreign policy objectives. And third, if he were trying to show the U.S. that he is serious about ridding Hungary of corruption, he would tell his minions to relieve Ildikó Vida and her co-workers of their duties. I believe that this piece of news is no more than Fidesz disinformation. At best, it is a new round in his usual “peacock dance.”