Tag Archives: Turkey

The odd man out in Europe: Viktor Orbán in Ankara

Turkey seems to hold a special place in Viktor Orbán’s heart. Ever since he became prime minister for the second time around in 2010, Orbán has gone out of his way to court the country he considers to be an important factor in world politics. From the very beginning, he supported Turkey’s membership in the European Union, an event that is not likely, especially in light of the domestic developments in Turkey over the last four or five years. By 2013, Orbán had succeeded in establishing a strong bilateral relationship between the two countries. In that year, Prime Minister Recep Tayyip Erdoğan visited Budapest with 125 Turkish businessmen in tow. In 2012, the volume of trade between the two countries was only 1.7 billion dollars, which Orbán said he wanted to increase to 5 billion dollars by 2015. In December of 2013 Viktor Orbán visited Ankara. By that meeting it was eminently clear that these two men are soulmates. I covered that meeting at some length.

During the four years that have elapsed since Orbán’s visit to Ankara, Prime Minister Erdoğan amassed more and more political power until a military coup d’état in June 2016 gave him the opportunity to get rid of his opposition altogether. A year later he pushed through a number of constitutional amendments that awarded him sweeping powers. Democratic leaders looked upon the results of the referendum as a setback for Turkish democracy and were anything but enthusiastic. Not so Viktor Orbán, who phoned Erdoğan to congratulate him on his victory. Orbán genuinely welcomes the kind of system Erdoğan established as a consequence of these constitutional amendments.

A telling photo

Orbán’s second visit to Ankara this week highlighted the political friendship between the two heads of state. Orbán and about half his cabinet participated in a “joint Hungarian-Turkish cabinet meeting.” Holding such a meeting is a big thing in diplomacy and signifies especially close relations between the two countries. Before 2010 the Hungarian and Romanian governments used to get together quite frequently, but Orbán stopped the practice.

As is usual with such visits, the program is pretty tight. For instance, it is customary for the visiting prime minister to deliver a speech at a business forum. So, let’s start with this speech, especially since four years ago the plan was that by 2015 trade between the two countries would reach 5 billion dollars. As it turned out, the trade numbers came nowhere close to this goal. In the last four years there has been practically no growth in bilateral trade between Turkey and Hungary.

How did Orbán try to sell Hungary to the Turkish businessmen? Why should Turkey, a large and powerful country, care about small Hungary? There is one important consideration. Hungary “with a population of 10 million can produce 110 billion dollars’ worth of exports” while “Turkey with 80 million people generates 145 billion dollars’ worth of exports.” The manhandling of export figures is, I think, quite obvious. I also wonder how the Turks in the audience responded to the implication that their business abilities and economic successes were inferior compared to little Hungary’s. The second drawing point, in Orbán’s opinion, is the very low across-the-board business tax rate and government incentives given to investors that may mean an effective tax rate of less than 9%. Third, Hungary is part of the European Union, and “if someone enters Hungary he also enters a market of 500 million people.”

I found Viktor Orbán’s advice to the Turks on how to deal with Hungarian businessmen fascinating. It is important to know, he said, that Hungarians are very sensitive. “I suggest not provoking Hungarians when you want to have a business deal. It is very important not to lecture them [because] Hungarians are like the Turks. They don’t like to be lectured at.” Turkish businessmen ought to show them respect because “after all, Hungary might have a population of only 10 million but it has a thousand-year-old history.” Turkish businessmen also should praise Hungarians because that is very helpful in business. I found the whole speech bizarre.

Hungarian sources didn’t report on the speech of Binali Yıldırım, the Turkish prime minister, at the same business forum, but a summary of it is available in the English-language pro-government newspaper, Daily Sabah. He was less optimistic about Turkish-Hungarian trade relations than his Hungarian counterpart. He complained that although both Hungarian and Turkish incentives are attractive, the growth in trade hasn’t reached the desired level. Although the Turkish newspaper’s English prose is not the clearest, in my reading Yıldırım talked about 500 Turkish businessmen who have invested more than $100 million in Hungary while nearly 40 Hungarian investors have invested $10 million in Turkey. This is nothing to brag about. These are meager figures. I gained the distinct impression that the Turkish prime minister is not optimistic about the prospects of improving the current situation because he suggested that perhaps Turkish and Hungarian businessmen could cooperate in third countries instead. He was specifically thinking of African nations.

Binali Yıldırım and Viktor Orbán had an hour-long conversation, after which they gave a joint press conference. The Hungarian prime minister thanked Turkey for its struggle against terrorism and migration, by which it is not only defending Hungary but the European Union as a whole. Unfortunately, not too many people in Europe realize that, but Hungary definitely does. Turkey must remain a strong and stable country with a clear, unequivocal leadership, which in this case means an autocratic if not dictatorial regime under Erdoğan. We also learned that while the Hungarian government is doing its best to expel Central European University from Hungary, Orbán was negotiating with the Turks about a Turkish-Hungarian university. And while the Orbán government is trying to limit the number of Hungarian students attending gymnasium and wants to send them to trade schools instead, the two prime ministers were talking about establishing a Turkish-Hungarian bilingual gymnasium.

Binali Yıldırım was preoccupied with Turkey’s gripes over the stalled negotiations with the European Union and its demands for visa exemptions. Turkey is obviously hoping to use Orbán to advance its own agenda. “Visa-free travel for Turkish citizens to Europe would make a big contribution to improving bilateral relations between Ankara and Budapest,” and in fact he called on Orbán to take steps toward instituting a visa-free status in the EU, at least for Turkish businessmen.

The Hungarian media didn’t spend much time on this trip. Most news sites were satisfied to reprint MTI’s factual description of the visit’s highlights. The only exception was a short editorial that appeared in today’s Népszava. The author, Mária Gál, points out that instead of forcing an unnaturally close, fruitless economic cooperation with Turkey, the government should encourage businessmen in Romania and Hungary to invest in areas where cooperation would help the lives of the local population. For example, in Gyula, only a few kilometers from the Romanian border, there are no job opportunities and a lot of people live just above the poverty line, whereas in Arad, less than an hour away, it is difficult to find employees for the new industrial parks. Romania has a large market and has been developing by leaps and bounds. Why not invest in and foster good relations with Romania? And “we wouldn’t have to be ashamed of that cooperation,” indicating that Hungary should be ashamed of cooperating with Erdoğan’s Turkey. But Budapest rejects Bucharest’s “request to renew the previous practice of joint cabinet meetings because the Romanians trample on the rights of the Hungarian minority. Turkey, I guess, became our friend because of their exemplary treatment of their Kurdish minority.” Biting sarcasm well deserved.

July 1, 2017

Hungary quits the Open Government Partnership in a huff

Yesterday the Associated Press reported the Hungarian government’s decision to quit the Open Government Partnership (OGP), “a multilateral initiative that aims to secure concrete commitments from governments to promote transparency, empower citizens, fight corruption, and harness new technologies to strengthen governance.”

OGP was formally launched on September 20, 2011, when the eight founding governments (Brazil, Norway, the Philippines, South Africa, the United Kingdom, and the United States) endorsed OGP’s Declaration and announced their countries’ action plans. Since 2011, 62 other countries joined, including Hungary, which signed its letter of intent on July 10, 2012. In this letter of intent the Orbán government declared that “it attached the utmost importance to cooperation with civil organizations.” It was the Ministry of Public Administration and Justice under Tibor Navracsics that represented the Hungarian government in this particular undertaking, which claimed at the time that “it supports the effective implementation of the OGP commitments.” It also promised “in person consultations with the civil organizations and experts regularly on a monthly basis.”

These were the promises, but according to the recollections of the participants, after the initial good working relations “the process started to slow down as the document reached the political level.” The final commitments were vague and greatly weakened. By 2014 it was clear that the Hungarian government’s “sole purpose with its membership was the opportunity to communicate its devotion to open government” to the international community.

Hungary is the second country whose government is not ready to abide by guidelines set by the Steering Committee of OGP and endorsed by them. The first country to leave OGP was Putin’s Russia, which had joined the organization in April 2012. A year later, on May 17, 2013, the Russian government informed the group of its decision to leave. Russia’s participation in this group was dubious from the very beginning, but there were other countries whose commitments to the ideals of OGP were also questionable. OGP acknowledged in February 2014 that Lithuania, Malta, and Turkey had failed to meet their commitments as members of the Open Government Partnership. Warnings were issued to these three states. In addition, the Steering Committee redefined standards for suspending members. “Two warnings in a row would trigger a discussion about continued membership of OGP countries” that create hostile environments for civil society.

By October 2014 new rules were in place that made suspension of membership practically automatic if any country limits the freedom of information; limits the activities of civic groups; favors civic groups attached in some way to the government; limits the freedom of expression and freedom of assembly; limits freedom of the press, independence of the media, or engages in the intimidation of media owners. 444.hu’s eagle-eyed reporters noted the OGP’s tightened rules for suspension, adding that they are tailor-made for Viktor Orbán’s Hungary.

The first victim of the new suspension rules was Azerbaijan. In March 2016 the Criteria and Standards Subcommittee recommended the move because “such constraints are evident in the laws on grants, non-governmental organizations, incarceration of NGO activists and journalists” that would precipitate “OGP’s response policy.” At that time, it was noted, “similar NGO complaints that the Hungarian government is restricting civil society remain under consideration.” In addition, Turkey was suspended in September 2016 because it had failed to deliver a National Action Plan since 2014.

Prior to this time the Orbán government had begun a war against Hungarian nongovernmental groups, financed mostly by the Norway Grants but also by the Soros Foundation. The government accused these NGOs of representing foreign interests and proceeded to raid their offices. At that point four leaders of NGOs decided to follow their colleagues in Azerbaijan and launch a formal complaint against the Orbán government. Fanny Hidvégi of the Hungarian Civil Liberties Union, Sándor Léderer of K-Monitor Watchdog for Public Funds, Miklós Ligeti of Transparency International Hungary, and Júlia Keserű of the Sunlight Foundation wrote a letter to the members of the OGP Steering Committee. The letter is available on the internet.

After considering the complaints submitted by Hungarian NGO leaders, OGP proposed several remedies that the Orbán government should adopt. It suggested the establishment of a Permanent Dialogues Mechanism (PDM) within sixty days that would ensure the participation of the relevant government agencies and interested civil society organizations. What must have especially irritated the Orbán government was that “all members of the public will be kept informed about all core aspects of the national OGP process—and especially know well in advance … about the key moments to provide inputs and discuss priorities.” OGP demanded five so-called Smart Recommendations that the Orbán government would never accept: monitoring of public disclosure practices of local government and state-owned enterprises; reviewing party and campaign financing regulations; revising the freedom of information regulations; revising regulations on classified information; and launching e-procurement. For easy access to this document, I am attaching it in full at the end of this post.

After reading these “recommendations” I’m not at all surprised that the Orbán government accepted the odium of withdrawal. A semi-autocratic, illiberal government of the kind that exists in Hungary today would never agree to such demands.

So, let’s see how the official government media explained the decision. Magyar Idők justified the Hungarian decision by citing OGP’s “one-sided criticism” of the Orbán government based on the unfair accusations of “civilians financed by George Soros.” These NGOs serve foreign interests and have been spreading false stories about the Hungarian government. Transparency International and TASZ, the Hungarian equivalent of the Civil Liberties Union, had complained to the organization about the Orbán government already in October 2012, shortly after Hungary joined OGP. In January 2013 K-Monitor allied with TASZ and TI in a new attack. And here was the latest one. It was high time to quit this unfair organization.

In the opinion of Szilárd Németh, deputy chairman of Fidesz, Hungary’s abandonment of the organization “actually sheds a very positive light on us because we do not want to participate in an organization where members carry on a conversation among themselves after which they single out somebody whom they are trying to keep at bay with one-sided reports, distortions of facts, with documents prepared by phony civil organizations mostly financed by George Soros.” It was a good decision, “a lovely gift for the time when they can get together again and they can nod against Hungary.” Németh is referring to the Open Government Global Summit, which is being held at this very moment in Paris.

The opposition’s interpretation of the move was predictable. They pointed out that the Orbán government no longer cares what the world thinks of it because surely, following in Russia’s footsteps, they are practically admitting that they are corrupt to the core. Zsolt Gréczy, DK’s spokesman, said that Hungary’s eventual suspension from the organization was inevitable. But the country’s withdrawal from the organization a day before the beginning of the Global Summit was unnecessary in that Hungary was not facing suspension at this time. The demands the organization made on the Orbán government, however, were more than the “proud Magyar” could stomach.

♦ ♦ ♦

December 8, 2016

Viktor Orbán’s “veto” turned out to be a hoax

The Hungarian media was abuzz for a few hours late last night with Viktor Orbán’s “veto” of the agreement between Turkey and the European Union at the March 7 summit in Brussels. If you visit the official site of the Hungarian telegraphic agency, MTI, you will find that its reporter learned from “sources in Brussels” that the summit was abruptly cancelled as a result of Viktor Orbán’s veto of the direct transfer of refugees from Turkey to the European Union. The report was filed at 20:06.

If MTI’s inaccurate reporting had remained the only source of the news, it wouldn’t have spread so fast as it did, all over the world. But Zoltán Kovács, government spokesman, decided to write on Twitter at 20:44: “Orban has vetoed EU-Turkey plan to relocate asylum seekers directly from Turkey.”

Less than an hour later, at 21:18, MTI returned to the subject of the veto. This second MTI report, written in Budapest, followed an interview with Zoltán Kovács on Channel M1 of the Hungarian state television. Here, the abrupt cancellation of the summit was changed to “cessation of the negotiations on the direct transfer of refugees from the Turkish refugee camps.”

Right-wing papers were singing the praises of Hungary’s great diplomat and statesman who had the courage to say no to the powerful heads of state of the European Union. But it didn’t take long before Hungarian reporters found out that there was in fact no decision that Orbán had the opportunity to veto. What happened was that during the discussion of the Turkish suggestion to transfer Syrian refugees directly to the European Union several member states objected to the details of the plan: Greece, Italy, Cyprus, France, and Hungary. Most likely, as Kovács indicated, the Turkish suggestion will have to be reworked to be acceptable to these countries. And indeed, discussions will take place in the next week or so between Donald Tusk, the president of the European Council, and Ahmet Davutoğlu, the Turkish prime minister, to modify and fine tune the proposal.

European leaders hailed the summit as a breakthrough because Turkey offered to take back all migrants who cross into Greece in the future. Of course, the deal comes at a price: doubling EU subsidies to care for the refugees from 3 to 6 billion euros and “a commitment to take one Syrian refugee directly from Turkey for each one returned from Greece’s Aegean islands.” In addition, Turkey asked the EU to speed up visa free travel for Turkish citizens and to open negotiations about EU accession for Turkey.

Aat today's press conference Angela Merkel looks very satisfied with herself

At today’s press conference Angela Merkel seemed happy with the results

So, let’s return briefly to the issue of the direct transfer of Syrians from Turkey to the European Union, which Orbán didn’t veto but only objected to along with several other member states. What is it all about? Is it really bad for the European Union countries?

First of all, let’s see what the plan would actually entail. Let’s say that in the future, after the agreement takes effect, a boat arrives in Greece from Turkey with twenty illegal immigrants, ten of whom are Syrians, five are Afghans, and five are Iranians. All twenty will be sent back to Turkey, according to the plan, but for the ten illegal Syrians, one of the European countries could choose ten Syrians currently in Turkish refugee camps. They would already have been vetted. Moreover, the host countries could make their choices based on the professional background of the asylum seekers or on any other criteria, like educational attainment, marital status, or age. Amnesty International considers this selection process immoral, inhuman, and shortsighted.

As far as Viktor Orbán is concerned, he repeatedly stated that Hungary will never accept quotas, compulsory or otherwise. In fact, in the most recent Friday morning interview he said that in Hungary “there will be no breaking through the fence, no revolts in refugee camps, no bandits hunting for Hungarian women…. We will not create a Europe out of Hungary, which will remain a safe place.”

The impression in Turkey is that Orbán doesn’t want any Muslims in his country, period. The Turkish Gazette Vatan quoted an Orbán statement at length, where he exhibited his anti-Muslim prejudices. According to the paper, Orbán at the summit said: “In our view, countries can accept a large number of Muslim immigrants. It’s their choice, but we do not want to…. [The direct transfer plan] doesn’t apply to all EU countries. If I gave approval to this plan, people would hang me from a lamp post in Budapest.” If it is indeed the case that not all EU countries will be required to take Syrians straight from Turkey, Orbán’s “veto” becomes especially ridiculous.

Fidesz’s official assessment came this afternoon. The spokesman for the party was Deputy Chairman Gergely Gulyás, who stressed that “at last the leaders of the European Union accepted the same position that Hungary has always represented, meaning that the borders of the European Union must be defended.” This is an incredible statement because we remember only too well that Orbán first demanded that Greece defend its 10,000 km. of coastline by force and later suggested amassing an international contingent to intercept boats carrying refugees. This deal with Turkey bears no resemblance to Orbán’s plans. But such discrepancies have never bothered any of the high-level Fidesz politicians.

Gulyás stressed, however, that the Hungarian government considers the agreement as it now stands “not in Hungary’s interest,” and therefore “in its present form it cannot be signed.” The government mouthpiece, Magyar Idők, followed suit and collected a host of negative opinions about the results of the summit, mostly from French papers. Magyar Nemzet, on the other hand, criticized MTI, Zoltán Kovács, and the state television for misinforming the public.

At the end, Angela Merkel herself set things straight when this morning she gave a press conference, during which a reporter asked her about Viktor Orbán’s “veto.” “There was no talk about a veto but about some disputed questions. You are familiar with the Hungarian point of view concerning quotas. They even went to court on this issue. This standpoint hasn’t changed. We still have to find answers for a score of questions or have to discuss them in the different parliaments. That’s why we said that we welcome the Turkish proposal but we haven’t given the nod yet.”

Orbán may have strenuously objected, but he still approved the final statement, which contained the provision for compulsory quotas. That’s why Zsolt Gréczy, spokesman of the Democratic Coalition (DK), said that the only thing Orbán is doing at the moment is trying to divert attention from the fact that within two weeks he twice voted for the compulsory quotas. Gréczy pointed out that the final document specifically mentions the necessity of speeding up the dispersion of refugees in order to lighten Greece’s burden. I am really looking forward to that final nod, to which Merkel referred. I’m sure that, despite all the theatrics, Viktor Orbán will be one of the signatories.

March 8, 2016

Seehofer in Hungary: A disappointment for Orbán

Horst Seehofer, minister president of Bavaria and the leader of Christian Social Union, has been pursuing an independent foreign policy of sorts lately. In December he paid a visit to Moscow where he met Vladimir Putin, a trip he is planning to repeat in the near future. His visit to Hungary yesterday was interpreted as a sign of Seehofer’s attempt to gain allies in his fight against Angela Merkel’s refugee policy. Politicians in his own party were uneasy about this trip. They were especially puzzled why the minister president decided to pay a visit to Budapest only three days before an important European summit dealing with the refugee crisis. One might add that not all Seehofer’s colleagues are happy with what has been an expensive Bavarian-Hungarian friendship. Some time back Seehofer championed establishing a subsidiary of the state-owned Bayerische Landesbank in Hungary. It flopped and was eventually purchased by the Hungarian state at a loss of two billion euros to Bavaria.

Der Spiegel was especially critical of Seehofer’s trip to Budapest, which it called “a mini-summit” against the European solution to the crisis. But almost all the German papers criticized his overly friendly relationship with Orbán, who was described by Die Zeit as “the chief ideologist of national closure.” Liberal papers especially considered the trip an outright provocation of Angela Merkel. They described Seehofer as two-faced. He keeps repeating that he and Merkel are in constant touch, but when it comes to supporting Merkel’s refugee strategy he refuses to answer questions concerning the issue.

It seems, however, that the assumption that Seehofer and Orbán are co-conspirators was misplaced. In fact, Seehofer went to Hungary to have a heart to heart with Orbán. Or at least this is what we learned from an interview with Manfred Weber, the leader of the European People’s Party in the European Parliament. The message he carried to Orbán was that “the essence of Europe is compromise” and that “if we want a European solution [he] must also move away from [his] current position.” That may mean that the EPP is no longer ready to shield Viktor Orbán from well-deserved criticism.

The press conference that followed the conversation between Seehofer and Orbán confirmed that Seehofer delivered Berlin’s message. Both men, as  Index put it, “ swore allegiance to Angela Merkel.” Orbán said practically nothing about the meeting itself except for some of his ill-phrased comments that are inappropriate and embarrassing. For example: “When two men get together, everybody is curious what their opinion is of the lady who is not present. But we know that this is man’s fate.” Otherwise, Orbán in his remarks didn’t show much inclination to follow the policies of Angela Merkel vis-à-vis Turkey, except to say that Hungary is willing to give money for the upkeep of the refugees. However, when it comes to moving Syrians out of Turkey and granting visa exemption to Turkish citizens, Orbán’s solidarity with Turkey, which he considers a strategic ally, seems to be totally absent. I wonder what President Erdoğan will think of his friend’s unyielding posture toward his country.

Seehofer was equally tight-mouthed, but he wished “with all his heart” that Merkel will succeed at the summit on Monday where she is planning to convince the prime ministers of the member states to accept as many refugees as possible.  Hungarian observers noticed disappointment in Orbán’s demeanor because it seems that he lost his most influential ally in the Bavarian minister president. Orbán’s only remaining ally is Robert Fico, who is in the middle of a national election campaign.

Seehofer and Orban2

Although Seehofer said little at the press conference, what he said in a speech delivered at the Andrássy Universität, a German-language university in Budapest, was, in my opinion, very important. He talked about the rule of law as a prerequisite of European solidarity. He called on everybody to stop “the erosion of law” in Europe. One cannot help thinking that he was referring to Hungary itself or perhaps Poland because I cannot think of any other European country that has serious problems as far as the rule of law is concerned.

 

After these introductory remarks he returned to the question of solidarity, the absolute necessity of European integration, and the continent’s low birthrate which, since 1946, reduced its population to only 7% of the world’s. The countries of Europe, he maintained, can achieve their individual interests only through a common policy. When it comes to important issues the European Union actually needs more integration, not less.

Seehofer went against Orbán not only on the question of integration but also on the treatment of the refugees. Bavaria’s immigration policy is built on three pillars, he said: humanity, integration of those who are deemed to be true refugees, and limits on immigration. In the past 25 years Bavaria has taken in two million immigrants. The integration of these people has been a great success.

He concluded by saying a few nice words about Hungary’s economic recovery and its generosity in 1989 when the country opened its border with Austria to the East German refugees.

Seehofer’s speech was followed by László Kövér’s harangue against the refugees, against immigrants in general, and against integration. According to him, “today the national, religious, family, and sexual identity of the European people is under attack.” If artificial European identity devoid of national consciousness materializes, it would be as unrealistic as the artificial Soviet or Yugoslav identity. It could be maintained only through force, relative well-being, and geopolitical interest which can collapse once force no longer can be sustained, the welfare state ceases to exist, or global interests change.” He went on and on in this vein. His tirade was dutifully reported at length in the far-right Magyar Hírlap, which found his message much more palatable than Seehofer’s. I wonder what Seehofer, who is a very conservative man, must have thought of Kövér’s speech, since it went against everything that European politicians west of Hungary think about the world.

All in all, I don’t think Orbán is a happy man today, especially since his fence, which he is planning to extend along the Romanian-Hungarian border soon, has turned out to be porous. Daily at least fifty people break through the “impenetrable” fence, which was supposed to save Hungary from the bandits who want to rape Hungarian women, from the migrants who can no longer be shipped off to the Croatian or the Austrian border. One temporary shelter after the next is being built and Orbán, I think, will soon enough have to ask for help from his enemies in Brussels.

March 5, 2016

Viktor Orbán’s solution to the refugee crisis has been discarded

I really hate leaving the topic of the teachers’ revolt because I am convinced that this is an important event that may have lasting consequences in the political life of Hungary. Of course, we will return to the subject by Saturday at the latest. But, although Hungarians in the eighteenth century liked to think that “extra Hungariam non est vita, si est vita, non est ita” (there is no life outside of Hungary and if there is, it is not the same), the world is currently teeming with events that may have a substantial impact on Hungary, which Viktor Orbán is trying to insulate from the rest of the world.

I think it is patently obvious by now that the Hungarian prime minister imagines himself to be a key player on the world stage. In the last few weeks he has positioned himself as a counterweight to German Chancellor Angela Merkel, offering an alternative policy of how to handle the refugee issue.

Russian bombers are furiously attacking moderate opposition forces in Syria, driving tens of thousands more people into exile in Turkey and thereby swelling the number of refugees who are embarking on the dangerous voyage to Greece and from there to points farther north. In bombing Aleppo, Russia is wittingly or unwittingly exacerbating the crisis within the European Union, fueled in no small measure by Viktor Orbán himself. Clearly, Europe must find a solution to the crisis. It’s not that even two or three million people couldn’t be absorbed by a region of 500 million inhabitants, but such numbers, especially if the refugees swarm into only one or two countries, can become unmanageable.  So, the influx must be slowed and regulated.

Currently there are two very different concepts in circulation regarding the defense of the European Union’s external borders. One is an orderly resettlement of refugees, which involves slowing the influx of refugees by controlling the Aegean Sea. This idea is supported by Angela Merkel. The other is “the brainchild” of Viktor Orbán and is supported by some of the Central European politicians. The greatest supporter of Orbán’s scheme is Miro Cerar, prime minister of Slovenia. This involves constructing an insurmountable fence between Greece and her three neighbors:  Macedonia, Albania, and Bulgaria. Which of these two plans has the better chance of being approved at the end of the day? Most observers think that Orbán’s plan will fail because “it would needlessly and unfairly antagonize Greece, destabilize the Western Balkans, and create a huge demand for readily available smuggling services.” In addition, it would require a fence as long as and as sturdy as that between Israel and Egypt that took three years to build. It would also entail a willingness to use deadly force.

As the result of Orbán’s masterplan, Hungary’s relations with Greece are strained. How tense they are became public only very recently when Nikos Xydakis, the Greek deputy foreign minister for European affairs, paid a visit to Budapest. The Greek foreign ministry announced on February 8 that Xydakis, whom the Greeks call “alternate minister,” was to visit Austria, Slovakia, and Hungary. In Austria he had a meeting scheduled with Minister of the Interior Johanna Mikl-Leitner and the secretary-general of the Austrian foreign ministry, Michael Linhart. From Vienna he was to travel to Slovakia, where he was to have a meeting with Foreign Minister Miroslav Lajčák and Deputy Foreign Minister for European Affairs, Ivan Korčok. Finally, he was to meet with officials in Budapest.

Xydakis got a mouthful from Johanna Mikl-Leitner, who severely criticized Greek measures taken in keeping the refugees at bay. She “wanted to know why the Greek leadership did not use its deployment-ready naval fleet for civilian purposes.” In Bratislava, where he met with the foreign minister himself, he had an easier time. Their meeting was described as friendly. Instead of criticizing Greece, the Slovak foreign minister wanted to hear about Greece’s refugee management.

In Hungary Xydakis had three meetings. One was with Interior Minister Sándor Pintér, the second with Levente Magyar, deputy to Péter Szijjártó, and the third with Szabolcs Ferenc Takács, undersecretary in charge of European affairs. We don’t know what transpired at these talks, but Xydakis wasn’t in a very good mood when Népszabadság asked him for an interview. He minced no words, calling Hungarian policy towards Greece “hostile.” Hungary hasn’t even sent one tent to Greece, and it contributed only five policemen to the staff of Frontex’s mission. At the same time Hungary sent 100 km of barbed wire and 31 soldiers and policemen to assist in the building of a fence along the Greek-Macedonian border. “This was a political decision, which we consider to be a hostile act from a NATO ally and an EU partner whom we considered our friend. The Macedonian and Bulgarian action is unfriendly, but it understandable that they want to defend their own borders. What, however, is unacceptable is that other EU countries send policemen and soldiers to the Macedonian-Greek and Bulgarian-Greek borders. Who is the enemy? We, the Greeks?”

From the interview we learned that both Vienna and Bratislava offered material aid to Greece, which has had an influx of almost a million refugees. In Budapest Pintér offered nothing. He said only that he will take a look at the list of items Greece desperately needs. Xydakis also reported during the interview that German-Greek relations, which during the Greek financial crisis were severely strained, have improved greatly. The refugee crisis has brought Germany and Greece closer, and today they work hand in hand because collaboration is an absolute necessity under the present circumstances.

In Xydakis the Hungarians found somebody who is not like the usual overly cautious and overly diplomatic West European politicians. Xydakis, who is relatively new to politics, used to be the editor-in-chief of Greece’s premier daily Kathimerini. Knowing the Orbán regime’s policy of immediate counterattack at the slightest criticism of its policies, you can imagine what Péter Szijjártó had to say after reading this interview. The diatribe against Greece was long, but one can summarize it easily: Greece has no right to give lessons on solidarity. It is entirely Greece’s fault that Europe is defenseless because Greece isn’t fulfilling its obligations. Hungary had the remedy from the very beginning: one needs soldiers, policemen, ships, helicopters, airplanes, not Frontex officials. If Europe is ready to defend the border by force, Hungary is ready to contribute to the effort.

Source: The Independent

Source: The Independent

I wonder what Szijjártó thinks now that a few hours ago the decision was made to deploy the NATO fleet to the Aegean Sea. The decision was made right after Greece declared Turkey a “safe third country,” which gives it the legal framework to turn back asylum-seekers arriving through Turkey. The fleet, which is currently under German command, “will be tasked to conduct reconnaissance, monitoring and surveillance of the illegal crossings in the Aegean sea.” It seems that the West, which has been so severely criticized by Orbán, is quite capable of acting without his assistance. The idea of keeping Greece under quarantine failed. I wonder what will happen to the 100 km of barbed wire Budapest sent to the Macedonian border.

February 11, 2016

No, Viktor, illiberalism is not the key to economic growth

Today’s post was inspired by an article that appeared yesterday in 444.hu with the intriguing title “We only wanted to open the doors to Eastern dictatorships, but they were blown away by the Curse of Turan.”

What is the Curse of Turan? It is legend according to which Hungarians of the eleventh century were cursed by their pagan shamans when they abandoned their old faith for Christianity. And what about Turan? According to Persian mythical tradition, it was the name of an area which today is known as Turkistan.

We have spent countless hours discussing Viktor Orbán’s firm belief that western civilization and its market-based economy are on the decline while the eastern illiberal, autocratic, dictatorial regimes are thriving economically. They will eventually overtake the West. Orbán projected the recent spectacular growth in some of the Asian countries into a linear trend that might last–well, forever. He kept repeating that we live in a new world which only he was astute enough to discover. And he began making pilgrimages to these thriving eastern countries, courting them, praising their dictators so shamelessly that some Hungarians were outright embarrassed. He went so far as to return an Azeri murderer to Azerbaijan, although he must have known that he would be greeted as a national hero at home for killing an innocent Armenian army officer in Budapest.

This is what happens when someone with limited knowledge of the economic and political complexities of the world acquires unlimited power and begins to implement his idées fixes. Orbán’s theory was based on wrong assumptions and a flawed model. These countries’ economic growth was not due to the illiberal nature of their regimes, as Orbán believed, but to other economic factors–in most cases, to the commodity boom. Most of the countries Orbán so admired were flush with natural resources: oil, natural gas, and important minerals. As long as gas and oil prices were high, the political leadership of these countries was satisfied and did next to nothing to diversify. This is what happens when, as a result of the preponderance of state enterprises, no truly free market economy can develop that would ensure a healthier economic mix.

Viktor Orbán put enormous effort into his “Eastern Opening” project, with few results to show for it. 444.hu examined Hungarian exports to six countries east of Hungary between 2009 and 2014: Azerbaijan, Kazakhstan, Saudi Arabia, Turkey, China, and Russia. Hungarian exports to Turkey grew slightly, the others either stayed the same or actually decreased. 444.hu describes trade with Azerbaijan, Kazakhstan, and Saudi Arabia as microscopic. Investments from these same countries are so insignificant that the Hungarian National Bank doesn’t even record their size. But even Russian, Chinese, and Turkish investments are minuscule, only a few billion, which is very small indeed as a share of total foreign investments in 2014, which was 2.5 trillion forints.

The percentage of the six Eastern countries in Hungarian export between 2009 and 2014. Source: KSH

Hungarian exports to the six eastern countries between 2009 and 2014 as a percentage of total exports. Source: KSH

In the past Viktor Orbán’s admiration of Azerbaijan’s economic accomplishments knew no bounds. In April 2014 he compared Hungary’s  modest 3% growth to the fabulous Azeri growth of 17% between 2003 and 2010 and, after that, 5-6% percent every year. But a little more than a year and a half later Azerbaijan is in grave economic trouble. On January 28 Bloomberg reported the start of negotiations between Azeri officials and the IMF and the World Bank for a four billion dollar loan. The discussion centered around the liberalization of the economy and the improvement of the business climate in exchange for the money. Although the Azeri finance minister insisted that they are in no immediate need of the four billion dollars, the facts don’t support his claim. “The Azeri central bank moved to a free float on December 21 after burning through more than 60% of its reserves last year to defend the national currency … the manat which nosedived by about half last year and slumped further to record lows this month.”

Orbán also sang the praises of Kazakhstan in June 2014. He found the achievements of the country in the last fifteen to twenty years absolutely spectacular. According to him, “the importance of Kazakhstan in the world economy will grow year after year.” Well, that forecast hasn’t panned out either. Because of falling oil prices Kazakhstan’s export income dropped by two-thirds after 2013. This year analysts predict a recession. The Kazakh currency, the tenge, crashed in a spectacular fashion in the middle of 2015. Bloomberg remarked that “Kazakhstan is a textbook case on why economies must diversify” and added that “powered by natural resources ranging from oil to uranium to copper, including the world’s largest proven zinc deposits, the economy has remained hamstrung by corruption and political controls.” Political control, which Orbán believed to be a necessity for economic growth, is in fact an impediment according to economic analysts.

Orbán was also very enthusiastic about the prospects of the Turkish economy. Western analysts, however, are less sanguine. Al-monitor, in an article written in August 2015, said: “Any one of the following problems would ring alarm bells for an emerging market: a slowing economy, rising inflation, distrustful citizens exchanging local currency deposits for dollars whenever possible, a rising tide of violence scaring away foreign tourists and hurting hard currency reserves, and concerned foreign investors eyeing the exit because of a bearish stock exchange and a possible hike in interest rates by the US Federal Reserve. Not content with just one, Turkey is facing all of those headaches and more.” The Turkish economy is still growing by about 3% per annum, but given the growth of the Turkish population this is considered to be a weak performance.

It was at the beginning of 2014 that Orbán visited Saudi Arabia and, as usual, lauded the greatness of the country and its leadership. Saudi Arabia has nothing but oil to export, and if the price of oil falls precipitously for a longer period of time the country is in trouble. At the moment the yearly deficit is 20% of the GDP. Foreign currency reserves are dwindling, and the Saudi princes are becoming visibly nervous. They are entertaining all sorts of measures that may or may not work. There are analysts who predict that the government of the House of Saud may collapse in the not too distant future.

Russia, which also relies heavily on its natural resources, is in trouble as well. As The Economist said a few days ago: “Russia’s economic problems move from the acute to the chronic.” Between mid-2014 and today Russia’s exports and government revenues collapsed. Its GDP shrank by nearly 4%; inflation was close to 13%. The ruble lost half its value against the dollar in 2014 and, after rebounding somewhat at the beginning of 2015, now stands at 80 rubles to the dollar. In March 2014 the exchange rate was 36 to 1. The latest is that Russia is exploring an international bond issuance, which signals that there is a shortage of funds as the economy heads for a second year of recession.

Finally, 444.hu reminds its readers of Orbán’s words at the Chinese-Central-Eastern European Summit in November 2015: “In the past there were many who had doubts about China’s long-term economic future. It was then widely held that the strengthening of the Chinese economy was only a temporary phenomenon and that the financial crisis would undermine its economic growth. But today we see exactly the opposite of this prediction. China is marching along with a permanent and sustained development, and we all know that it will soon be the strongest economy in the world.” But China’s economy is slowing, and worse may come in the wake of the greatest construction boom and credit bubble in recorded history. As an analyst described that bubble: “An entire nation of 1.3 billion has gone mad building, borrowing, speculating, scheming, cheating, lying, and stealing.” He called it a “monumental Ponzi” scheme. In any case, China’s economic growth in 2015 was the slowest in 25 years, and its economic decline is probably even more serious than its questionable figures indicate.

So much for Viktor Orbán’s belief that illiberal leaders are the only ones who know the secret of sustained economic growth.

Closing the Croatian-Hungarian border will not solve anything

It was telegraphed way before yesterday’s summit of the European Council that the key question would be how the European Union could entice Turkey not to allow the unlimited exodus of Pakistani, Afghan, Iraqi, and Syrian refugees from its territory. It is only Turkey that can play a meaningful role in stemming the refugee tide because defending the borders of Greece would be a hopeless undertaking given its 6,000 km shoreline. Yet, hopeless or not, this was one of the demands of Viktor Orbán already at the last Brussels summit.

Naturally, under these circumstances Turkey is in an ideal position to push for its long-standing political demands vis-à-vis the European Union, such as renewing negotiations for Turkey’s EU membership. Of course, Turkey will need other enticements to take care of ever larger numbers of refugees. The Hungarian government as a friend of the present Turkish regime is supportive of Turkey’s aspirations and is ready to follow whatever common policy the EU comes up with.

The summit, however, didn’t support Orbán’s suggestion for the common defense of Greece’s borders. Instead they opted to strengthen Frontex, an agency whose mission “promotes, coordinates and develops European border management in line with the EU fundamental rights charter applying the concept of integrated border management.” After the meeting Donald Tusk explained that the decision was made to endow Frontex with greater powers than what it now possesses to ensure “the defense of the European community.” But, he added, a humane and effective solution must be found because otherwise “others” will find inhumane, nationalistic, un-European solutions. I wonder whom Tusk had in mind.

By last night we knew that although Viktor Orbán had voted for the proposals that included the strengthening of Frontex, he would act unilaterally. The fence between Croatia and Hungary was complete, the troops were ready to move. He said that his decision on whether to close the border between the two countries would depend on the agreements the European Council reached at the summit that ended late last night. Right after the meeting the Hungarian prime minister was accosted by a few reporters, and he indicated that he was very unhappy about the summit’s failure to adopt his suggestion for the defense of Greece’s borders. Therefore there was little doubt in anyone’s mind that by this afternoon, shortly after his arrival in Budapest, the border with Croatia would be sealed.

We know two persons whom Viktor Orbán met while in Brussels because we have photos of the meetings. One was with Angela Merkel at a gathering of EPP leaders before the summit began. We don’t know whether he warned the German chancellor about his impending plans, but if he did, I’m sure the announcement was not met with her approval.

The other meeting was with Croatian Prime Minister Zoran Milanović, who is just as forceful a man as Orbán is. It was not a formal encounter, but whatever transpired couldn’t have been the friendliest. I gather that this time Orbán did tell Milanović about his plans because after the summit the Croatian prime minister announced that he doesn’t care what Hungary does. He said that “Hungary’s solutions didn’t find supporters in the European Union.” It seems, however, that the two men agreed that “Hungary will not send soldiers to the Croatian-Hungarian border.” Well, that agreement was short-lived: thousands of Hungarian soldiers, policemen, and TEK forces are now stationed along the border.

Zoran Milanović and Viktor Orbán in Brussels, October 15, 2015 MTI / Európai Tanács / Enzo Zucchi

Zoran Milanović and Viktor Orbán in Brussels, October 15, 2015
MTI / Európai Tanács / Enzo Zucchi

As of midnight refugees can enter Hungary from Croatia only through two official gates, one at Beremend and the other at Letenye. Readers of Index and Magyar Idők spotted TEK convoys moving toward these two border crossings, one in the southern and the other in the western section of the Croat-Hungarian border. We can only hope that this time members of TEK will be less brutal than they were a month ago in Röszke on the Serb-Hungarian border.

The opposition parties condemned the decision to seal yet another border, and Együtt and DK accused the Hungarian government of meddling in Croatian domestic affairs. On November 8 there will be national elections in Croatia where the fate of the ruling Kukuriku coalition of four center-left and centrist parties hangs in the balance.  (Yes, “kukuriku” in Croatian means exactly the same thing as in Hungarian [kukurikú] “cock-a-doodle-doo.” The coalition was named after the restaurant where they first met.) The right-of-center Patriotic Coalition, headed by Tomislav Karamarko, is challenging the socialist Zoran Milanović. Polls show that the election will be close.

Fidesz’s sympathies lie with HDZ (Croatian Democratic Union), the largest party in the Patriotic Coalition. In the last few days the Hungarian government has lavishly courted the conservative Croatian president Kolinda Grabar-Kitarović, who spent three days in the Hungarian capital and held long, friendly conversations with President János Áder. Her win in January was a great surprise to everyone, but from the little I know about Croatian politics her win didn’t signal a serious turn to the right in Croatia. Moreover, according to the latest polls, since Zoran Milanović decided to pick a fight with the Hungarian prime minister the Kukuriku Coalition’s popularity has only grown. Although the Orbán government is hoping to strengthen HDZ with its policies, its anti-Croatian rhetoric may backfire. Of course, a win for the conservatives in Croatia would be considered a triumph for Viktor Orbán and would mean a new ally in the region.

As far as we know, preparations are in place to move the refugees from Croatia to Slovenia. For the time being most people consider building a fence between Slovenia and Hungary, two Schengen countries, outside the realm of possibilities. I don’t want to give any tips to the Orbán government, but I heard a Hungarian international lawyer who is convinced that it could be done legally. Let’s hope he is wrong because otherwise there will be no end to Orbán’s fence building, which has so far cost Hungarian taxpayers 100 million dollars.