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Non-existent Hungarian economy

Non-existent Hungarian economy

Will Aliyev's money save Hungarian economy? Or maybe Azerbaijan just teased it with a carrot instead of paying?

Starting August 31, Hungary has become a target for Armenia's close attention. For quite a while, Armenians wondered how they could sell the murderer, even for a large sum of money. The media reports, blogs and the official website of the Hungarian government and Prime Minister Viktor Orbán present quite a dismal picture of Hungary's economic situation.

PanARMENIAN.Net - So, the national companies: the national MALEV air company was sold and resold several times and finally went bankrupt.Ganz Mavag, the largest machine factory which manufactured steam locomotives, rail vehicles, locomotives, buses, etc since 1870, used to export its production to USSR, Canada, Switzerland, Italy, Romania, Egypt, India, Yugoslavia, Korea and other countries. The company, now owned by Austria, is ruined. Its production departments are now used by country’s largest Chinese market.

Ikarus, the famous bus manufacturer founded in 1895, was shut down in 2007. In 2010, they tried to re-launch the factory; however, Hungary today purchases buses mostly in China.

MAV, the Hungarian national railway company (1869) is now divided into passenger and freight transport units. The cargo division, most profitable one, is currently a privately held one, while the unprofitable passenger transport unit is owned by the state. Earlier, cargo transportation provided subsidies for passenger trains; now, railway communication to remote settlements is either cut or shut down.

BKV, the public transport company of Budapest established in 1968, will soon be split and privatized. A French company will undertake construction of a new station of Budapest subway, once built by Soviet specialists. The price is already three times higher than the Russian cost estimate. Hungary got EU funding for this; the money was spent, with no station built so far. Meanwhile, the credit should be returned in two years… In addition, they somehow managed to construct only…. 1 km of the highway worth $1 bln. 30% of money was spent on “legal consultancy”, namely compilation of a contract and “legal resistance”.

The Herend Porcelain Manufactory (1826), a manufacturing company specializing in luxury hand painted and gilded porcelain, the dishware supplier of the British Royal Court, is still operating. Zsolnay (1853), a Hungarian manufacturer of porcelain, is in fact ruined. The production departments once supplied dishes to IKEA, and were shut down later.

RABA, a truck and engine manufactory is closed. Some capacities are liquidated, other are partially transferred to Suzuki, Audi and Mersedes assembly units. Also, Mersedes got such tax benefits that, according to independent experts, dismissing them would be cheaper than maintenance.

Gedeon Richter, the widely known pharmaceutical plants were given back to their previous, “pre-Socialist” owners. In 2010, previous owners sold the company to the Swiss Prelegem. Currently the new owners are transferring the production to neighbouring Slovakia because of tax considerations.

The famous Hungarian eco-friendly agriculture is actually ruined. Some of the local milk processing units were purchased by Danon, others were shut down. Meanwhile, the milk is largely imported from Poland, watermelons from Spain, tomatoes, along with other vegetables are brought from Spain and Turkey; garlic is imported from China, while meat and chicken come from Argentina and Brasil.

PIC, one of the two internationally known sausage factories which used to supply production to Europe and the U.S., is currently “naturally”owned by Austria. The second one, HERTZ, went bankrupt and was shut down, being a rival company. The famous Hungarian home-made sausages are now mostly produced in Slovakia. All 9 sugar manufactories are closed.

GLOBUS, agricultural export company widely known in Eastern Europe was also purchased by French Bonduelle; the national brand was immediately dismissed. Same was the case with MOL. The Hungarian oil and gas company changed several owners; “Surgutneftegaz” bought a share from the Austrian company and refused to register them as stockholders. Then stock was redeemed from the Russian oil company. The nationalist government spent nearly all pension fund money to buy MOL. Due to the lack of own oil fields and totally devastated economy, the petrol prices in Hungary hit highest in Europe. Instead, up to 80% of vehicles carried “Great Hungary” stickers.

Viktor Orbán heads the Nationalist Party of Hungary. His father was a Gipsy and mother was of Jewish descent. Orbán is married to Anikó Lévai. Anyway, writing about Orbán is dull and not interesting. The question is, whether Aliyev's money will save the Hungarian economy? And a second one – did Azerbaijan really pay, or just teased it with a carrot?

Karine Ter-Sahakian
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