Orban, Fiala trade blows over future of EU, V4

Czech Prime Minister Petr Fiala dismissed Hungarian Prime Minister Viktor Orban’s claim over the weekend that Czechia has “changed sides” regarding the EU, emphasising the importance of regional cooperation, rather than “absurd stigmas”. 

Speaking at the 32^nd Baile Tusnad “Summer University” Orban had said Czechia is now aligned with “European federalists”, having broken rank with the Visegrad Four (V4) Group of Poland, Czechia, Hungary and Slovakia. Only Hungary and Poland have resolutely defended the sovereignty of EU member states, according to Orban.

Speaking to the Czech News Agency, Fiala, who oversaw a successful EU presidency in the first half of the year, defended his government’s commitment to safeguarding the nation’s interests and sovereignty. He said Czechia had the autonomy to independently determine its stances on EU matters and support initiatives aligned with its interests. He pointed out that he has a different relationship with Orban compared to his predecessor as premier, Andrej Babis. 

Czech Interior Minister Vit Rakusan tweeted that “The only change that the Czech Republic has undergone in relation to the EU is a shift from opportunism to a constructive European policy based on shared values. We no longer simply take the position: give us our subsidies and keep your brains. For those who don’t know what I mean by opportunism: blackmail and then hold the bag…” he added in an apparent swipe at the Orban regime, which has ruled Hungary since 2010.

Orban: the Czechs have basically changed sides

The annual “Summer University” weekend at Baile Tusnad, which takes place on formerly Hungarian territory in central Romania, generally sees Orban expound on global politics, and even make global headlines.

Orban controversially said Romanian politicians have warned him “not to talk about non-existent administrative areas in Romania. I have thought hard about what they could mean by that. I think they mean Transylvania/Erdely and Szeklerland, but we have never claimed that these are Romanian administrative areas.”

“If the Romanian president comes to Hungary and gives a speech, which we invite him to do, we will not dictate to him what subjects he can talk about, and how he can talk about them. We also recommend that our Romanian brothers and sisters take note of the fact that Hungary fully supports Romania’s main national ambition at the moment: membership of the Schengen Area,” Orban said.

“We would like to draw their attention to the fact that from 1 July 2024, Hungary will hold the EU presidency and that our programme’s highlighted goal is for Romania to gain Schengen membership,” he added.

On Brexit, Orban said the UK’s shock decision to exit the EU has “upset the balance between sovereigntists and federalists within the EU.” According to Orban: “the earlier configuration (of the EU) was the French and the Germans as federalists on one side, and the British and us, the V4, on the other. If the British were in the EU today, we would not even have to learn terms like ‘rule of law mechanism’, ‘conditionality’ or ‘economic governance’, as they would not exist,” he claimed.

“These could only be introduced in the EU because the Brits left and we V4 members could not prevent them – and indeed the V4 was attacked by the federalists. We can all see the result.

“The Czechs have basically changed sides, Slovakia is wobbling, and only the Poles and Hungarians are holding out. Of course, we have a chance to increase the number of sovereigntists. I can see that chance, as such a government has been formed in Italy, there is also movement in that direction in Austria.

“Let us be under no illusion: the federalists are carrying out an attempt to oust us; they have openly said that they wanted a change of government in Hungary. They have used every means of political corruption to finance the Hungarian opposition.

“They are doing the same thing in Poland, and remember how they tried to prevent the (Giorgia) Meloni right from winning in Italy. All these attempts have failed, and I hope that the EU elections in June 2024 and the subsequent redistribution of power will result in a more favourable balance of power in Europe than the one we have today,” Orban said.

Orban sceptical on effectiveness of Russia sanctions

Orban also discussed Western attempts to “decouple Russia from the European economy through wartime sanctions. “Of course Europe can be cut off from Russian energy,” Orban said, “but in fact this is ineffective and illusory, because Russia cannot be cut off from the rest of the world.

“Russian raw materials will be bought by others, while we will suffer from wartime inflation and lose our competitiveness. I will quote you two figures. The EU’s imports of gas and oil were EUR 300bn combined before the Russian war, and EUR 653bn last year. Energy is costing twice what it used to cost, while in many parts of the world it is still available at the earlier price.

“This is the great debate for Europe in the years ahead. This is what we Hungarians have to prepare for: either to decouple or to participate in international competition,” Orban said.

Attacks on OTP equate to ‘Hungarophobia’ – Orban

“Of the 1,400 biggest Western companies, 8.5% have pulled out of Russia. From the pharmaceutical industry, 84% have stayed; 79% of the European mining industry is still in Russia, as are 70% of energy companies and 77% of manufacturing companies. In 2022, the Western companies that stayed paid a total of USD 3.5bn into the Russian central budget.

“Seen in that light, the attack that the Ukrainians are launching against our poor, small Hungarian OTP bank is nothing but a manifestation of Hungarophobia. We must therefore reject it. I am not even going to talk about clever little European tricks such as the sudden doubling – in a single year – of the volume of goods exported from Germany to Kazakhstan. I wonder why that was? 

“We are on track to meet our targets. In thirteen years the Hungarian economy’s overall performance has trebled: from HUF 27tn to HUF 80tn. Within a year the Hungarian economy will get back on its feet and by the end of this decade, Hungary’s GDP will be within striking distance of Austria’s, Orban claimed.

“Our goal is to have a GDP of HUF 160tn forints by 2030. In 2010 we stood at 66% of the European average, in 2022 we were at 78%, and by 2030 we want to be at 85-90%. If we look at the Hungarian economy’s competitiveness, in other words its exports, I can say that in 13 years we have doubled them (while) the share of products from Hungarian-owned companies has increased,” Orban said.

Nuclear to make Hungary energy independent

“Our energy dependency has reduced according to plan: imported electricity currently provides 28% of consumption, and by 2030 – with (the nuclear power plant expansion at) Paks, solar energy and network developments – we want to reach zero. We are building our power plants accordingly, and we will spend HUF 11.5bn on this.

“In 2010, employment was 62%, today it is 77%, and by 2030 we want to have increased it to 85%. We have a huge university development programme. In 2010 no Hungarian university was in the world’s top 5%; but last year 11 Hungarian universities were in the top 5%.

“As far as family support is concerned, we had a birthrate of 1.2, but have raised that to 1.5. This is called the fertility rate or reproduction rate, which is not a nice term; but it was 1.2, and now it is 1.5. In order for our population to stop falling, however, we need it to be 2.1,” he said.

Orban bullish on ‘difficult’ Hungarian economy

The most difficult period is now behind us. Inflation was sky-high, but now we are breaking its back, and we have every chance of getting it below 10% by the end of the year – so in single figures.

The first half of the year was very difficult, because inflation in Hungary rose faster than wages. This has not happened for a very long time, maybe more than ten years.

But in the second half of the year we will straighten out, and if the Good Lord helps us we will be able to nullify the depreciation of wages across the whole year, for 2023.

Interest rates on loans in Hungary today are also sky-high, but I believe that we will be able to normalise them and bring them back to an acceptable level by the second quarter of next year at the earliest.

Orban funding doubtful from ‘declining’ EU

If we look at the International Monetary Fund’s list ranking countries by economy size, national GDPs, we see that in the rankings for 2030 Britain, Italy and France will have dropped out of the top ten where they still are today; and Germany – now fourth – will have slid to tenth.

The EU has about 400 million people; and if I add in the rest of the Western world, that is another 400 million. So this amounts to 800 million people, surrounded by another seven billion. And the European Union has an accurate view of itself: it is a rich union, but a weak one that sees a world in revolt around it.

In answer to a question, Orban said it is “doubtful” whether Hungary will receive outstanding EU funds. However, on defence, Orban was bullish, saying “we have, or are beginning to have, an effective army. We will have warriors instead of employees in uniform. Alongside them, we now have a national defence industry. We are one of the few NATO member countries that can devote at least 2% of its annual GDP to this. And we are not far behind in our national unification programme for 2030.

“We have implemented a tenfold increase in the 2010 level of funding for national unification beyond the borders, and this year – at a time when we are facing all sorts of difficulties – we are increasing support for education and training fivefold: by 500 per cent,” Orban said.