On the occasion of the parliamentary elections in April 2022, important not only for Hungary, but also for Romania and the European Union, LARICS has started a wide-ranging, multi-episode series on the political realities in the neighbouring country. We will try to unravel the recent developments in Hungary, focusing on the main characters and the team around them. In this issue we will present the record of the Orbán regime’s continued cooperation with China and the Putin regime. The first part of this series can be read here, the second part here. The English version of this text can be read HERE, and the Hungarian version HERE. (LARICS).
Hungary, China and the Silk Air Road
Hungarian Foreign Minister Peter Szijjarto (centre) inaugurates Budapest Airport’s strategic partnership with Air China. Source here.
In this article, we review Budapest’s latest economic initiatives in its relations with China and Russia. The references are to the past year, and we will come back to Budapest’s major projects linking Hungary to China and Russia in future materials.
Last year Hungary opened up a new opportunity for political and economic cooperation with China. Budapest Airport, China’s Henan Airport Group, operator of Zhengzhou International Airport, and the Chinese-Hungarian logistics company CECZ/Utlink signed a cooperation agreement (April 2021) to create a Sino-Hungarian Silk Air Road and set up special logistics centres at the two airports to handle cargo traffic (source here).
The intensification of cooperation between the two countries comes amidst the coldness between most European countries and Beijing on economic cooperation. But the European trend is contradicted by Hungary, which is constantly banking on close relations with authoritarian regimes in China and Russia.
László Mosóczi, State Secretary in the Hungarian Ministry of Innovation and Technology, told MTI news agency, that “The cooperation agreement signed now on the connection of the two airports could provide important economic opportunities and significant expansion of air cargo traffic between China and Hungary. It could also bring important logistical and mutual benefits for Hungary, Central and Eastern European countries as well as China” (source here).
Fudan University comes to Budapest and replaces Soros Foundation
In 2019, Minister of Innovation and Technology László Palkovic announced that China’s Fudan University will open a campus in Budapest (source here). The Hungarian government has also announced that it will donate €2.2 million to Fudan University to build its new campus in Budapest, which is expected to become operational in 2024.
The announcement comes a year and a half after Orban’s regime sent into exile Central European University, the higher education institution founded by billionaire George Soros – which was one of the country’s top universities for 30 years.
The population of Budapest expressed that they want the Student City promised by the City Hall and not Fudan University, according to a survey conducted by Opinio Institute on a sample of 473 Budapest residents aged between 18 and 59 who answered questions via mobile phones. When asked to choose between the two institutions, the majority of respondents – 91% – answered that the Hungarian institution, which will serve 8,500 students, should be given priority over the Chinese university (source here).
Protests in Budapest against the establishment of Fudan University. Source here.
On 05.06.2021, 16 protests against the establishment of Fudan University were announced in Budapest, with the participation of more than 20,000 people, with the route from Heroes’ Square to Kossuth Square. The demonstrations were supported by: Mayor of Budapest – Karácsony Gergely, independent mayor of Ferencváros – Baranyai Krisztina, Jámbor András – initiator of the demonstrations and activists/former editor-in-chief of Mérce – Gede Márton and Őze Sándor, from the Város Mindenki/A City for Everyone, Utcáról Lakásba Egyesület / Street to Housing Association and Street Lawyers’ Organisations, as well as Bereczki Áron – activist of the Students’ League (source here).
Other strategic projects
In addition to those listed above, in terms of the relationship with the Chinese side, the Sino-Hungarian collaboration in the case of the Port of Trieste, the Zahonyi freight logistics centre, as well as the “mysterious project” of a railway that should make Hungary the main transport, logistics and distribution centre in Central Europe (see here) must also be mentioned.
On these very important, specific issues, we are preparing an extensive material to be published next week.
Let us now briefly recall some elements of the relationship with the Russian Federation, as they have been revealed in the last year alone.
Budapest’s economic relationship with Moscow continues unabated
Hungary remains a close and traditional ally of the Russian Federation, as evidenced by the recent efforts of the government in Budapest, which have continued unabated in this direction at all levels.
Hungary blocked the tough statement on the Russian Federation by the Visegrad Group/V4 (26.04.2021) in which the Czech Republic, Poland and Slovakia condemned Russia’s secret military operation recently exposed to the general public in the Czech Republic, i.e. the explosion of an ammunition depot in 2014 (source here).
Hungary and Russia carry out advanced talks on licensing the production of Sputnik V Covid -19 vaccine in Hungary, which could start from the end of 2022, according to Hungarian Foreign Minister Szijjártó Péter (August 2021), who pointed out at the time that a new gas supply contract with Russia’s Gazprom would also be discussed (source here).
Hungary is seeking to become the first European Union nation to join the Eurasian Development Bank in Moscow, according to Foreign Minister Szijjártó Péter (April 2021). Membership of the bank, which includes Russia and five other former members of the Soviet Union, including Kazakhstan, will help Hungary expand its investments in Central Asia (source here).
Hungary is also a member of another Russian-led lender, the International Investment Bank, which managed to move its headquarters to Budapest from Moscow in 2019, a move criticised by Hungary’s Western allies (source here).
Hungary and Russia have signed an agreement on the establishment of a Hungarian-registered joint rail logistics company with the participation of Hungarian state-owned CER Cargo, the Russian rail logistics company RZD Logistics, a Chinese entity that wasn’t nominated, according to Mosóczi László (July 2021), state secretary in Hungary’s Ministry of Innovation and Technology (source here).
Hungary cooperates with Russia and short-circuited Ukraine
Signing of Russian energy giant Gazprom’s long-term agreement with Hungary. Source here.
The culmination of this traditional partnership with the Russian Federation was the signing of the long-term agreement with Russian energy giant Gazprom. Hungary, one of Russia’s closest EU allies, signed a 15-year gas supply agreement in Budapest on September 27, 2021 that brings it gas from Russia via the Balkans and Austria (source here). Along with the Nord Stream 2 pipeline, which would deliver Russian gas directly to Germany, the move was seen as a weakening of Ukraine, which until recently has been the main route for Russian gas to Europe and a recipient of revenue through transit fees.
Ukraine reacted then. Hungary’s agreement with Gazprom “harms Ukraine’s national interests” and is a “political decision, which is not economically justified, that was taken to please the Kremlin,” the Ukrainian foreign ministry said, adding that it will ask the European Commission to assess whether the agreement complies with the European set of energy rules. The ministry also said Hungary’s decision on supply routes avoiding Ukraine was “surprising and disappointing” and that the decision breached the principles of the basic Hungarian-Ukrainian treaty signed by the two countries in 1991. The decision was “purely political and detrimental to Ukrainian national interests and Hungarian-Ukrainian relations,” he concluded (source here).
The agreement is “a vivid example of the Kremlin’s policies towards Ukraine,” Serhiy Makogon, executive director of the Ukrainian Gas Transmission System Operator LLC, said in a statement at the time. “Despite a contract until 2024, we expect further decreases or a complete shut-off of gas to Hungary through Ukraine.”
Commenting on the statement, Szijjártó deplored Kiev’s move and said he did not see “the link between securing Hungary’s energy supply and decent cooperation with our neighbours”. “I reject the attempt to interfere with Hungary’s affairs; providing winter heating for Hungarians is our business and no other country can interfere in this” (source here).
Read now through the prism of the war unleashed by the Russian Federation in Ukraine, the episode becomes very significant in terms of Budapest’s previous policies.
Russian propaganda in the Hungarian pro-government press
Beyond economic investment, the Russian Federation’s influence obviously extends far beyond this sector. On 19.03.2018, the Corruption Research Center Budapest/CRCB published a study entitled “The impact of the Russian propaganda state apparatus on online media in Hungary – 2010-2017”, in which it tried to find answers to questions related to the impact of Russian propaganda in pro-government online media in Hungary.
Using Big Data analysis methods, i.e. statistical content analysis and distributional semantic analysis (to identify linguistic elements with similar distributions/signification), CRCB archived 1,027,653 articles, i.e. 278 million words, during 2010-2017, from 9 Hungarian websites: 888.hu, hídfő.ru, index.hu, lokal.hu, magyaridok.hu, mindenegyben.com, mno.hu, origo.hu, pestisracok.hu. The study compared the content of government portals – 888.hu, lokal.hu, magyaridok.hu and pestisracok.hu – with that of non-government portals – mno.hu, index.hu and origo.hu – and with that of hídfő.ru portal, one of the most popular Hungarian-language Russian propaganda sites.
The experts concluded that the influence of Russia’s propaganda apparatus in Hungarian online media, especially those associated with the Orban Government, cannot be neglected. While in other countries, state institutions strive to limit such unwanted influence, this cannot be said of Hungary, where the government seems to have opened the country’s doors to the Russian propaganda apparatus.
The leverage of Russian influence in Hungary, according to experts, is distributed along the following strategic axes:
- contacts with right-wing radicals;
- recruiting and blackmailing Hungarian politicians;
- personal links to blackmailable Hungarian leaders;
- Russian interests in the Hungarian economy;
- perpetuating tensions over the breach of the rights of national minorities in Ukraine.
“Orbán has become a puppet carrying out Putin’s orders”.
On 02.02.2017, the Russian-language website “The Insider” published an article by Anastasia Kirilenko under the headline “Solntsevo’s suitcase: does Putin have <compromising video material> on the Hungarian leader?” presented information on one of the possible causes of Prime Minister Orbán’s loyalty to Putin. The article referred to the 1990s when Budapest was a hotspot for the Russian mafia and other characters with dubious backgrounds around the world. In this story, it is the first time that Orbán Viktor is named as the possible beneficiary of a suitcase full of illicit money from the most important figure of the Russian mafia, Ukrainian Semion Moghilevich.
International sources (here, here and here) have reported that this loyalty may also have had something to do with the arrest of Semion Moghilevich (January 2008, Moscow), alias “Szeva-bácsi”/nea Szeva.
In this context, the German journalist Jürgen Roth managed to talk to the businessman Dietmar Claude/Clodo (the character is in the literature as having been, in his youth, part of the “Red Army Faction”/RAF, which committed terrorist acts on the territory of the FRG, founder of the security firm SAS, with protection services in Germany, France and Russia – see Jurgen Roth, “Schmutzige Demokratie”, 2016), who in the 1990s lived in Budapest and was head of department in the Hungarian Chamber of Commerce and Industry and who spent about 8 years in a Hungarian prison (released in 2011), with links to various intelligence services also attributed to him. From Clodo’s statements (15.05.2016) it appears that Moghilevich met him through the nephew of Sergei Mihailov (“Mikhas” – one of the leaders of Solntsevo’s organized crime group), whom he met in Afghanistan. In a written confession, which was obtained by The Insider, Dietmar Claude mentioned how he had established a relationship of trust with Moghilevich, on the basis of which the latter had entrusted him with sums of money intended for Hungarian personalities between 1993 and 1996, one of whom was Sándor Pintér (Hungary’s Minister of Home Affairs), who at the time worked for the police and also for Moghilevici (Dietmar gave an interview to the Austrian TV station ORF in which he said that at the time Sándor Pintér was receiving 10,000 Deutschmarks from Moghilevich so that the Hungarian police would turn a blind eye to his machinations in Ukraine and Russia). Dietmar also said that in 1994 he had received a suitcase containing about one million Deutschmarks through Moghilevich’s interpreter, which was intended for a young man. Dietmar was instructed to hand the suitcase to the young man in his own office, the suitcase having to be opened there because a video camera was hidden behind the books to record the exchange. For Dietmar, at the time, the young man was just “one of many corrupt characters to whom he had to hand over bundles of money” and it was only after the Hungarian parliamentary elections (2010) that he realised that the young man was Orbán Viktor, the currency being destined for the Fidesz campaign.
On this, Dietmar told The Insider: “To my regret, Orbán has become a puppet who carries out Putin’s orders,” adding that, in exchange for his freedom, Moghilevich handed over the compromising tapes to former FSB manager Nicolai Patruchev. Dietmar later (2013) reiterated this information in an interview with journalist Antónia Rádi of HVG (Hungarian publication), who, after consulting the publication’s lawyers, decided to omit the politician’s name from the text of the article (currently inaccessible).
In January 2019, the Hungarian publication HVG revisited the story, headlining “Orban also appears in the book about Putin and Trump’s Russian Mafia ties” (we are talking about “House of Trump, House of Putin: The Untold Story of Donald Trump and the Russian Mafia”: published in August 2018 and written by American journalist Craig Unger, which presents information, acquired through investigations, starting in the 1970s, on the links between Donald Trump, Vladimir Putin and the Russian Mafia). HVG quoted from Dietmar Claude/Clodo’s statement (2016) in which he said he recorded the moment Moghilevich sent one million Deutschmarks to Orbán for the Fidesz campaign, which the book’s author, Craig Unger, said would have gone to Russian intelligence (allegations dismissed by the Hungarian PM’s Chancellery in 2017).
International experts conclude that “Hungary is a captive state of the Russian Federation” and a “willing enabler of Russian approaches subsumed to the concept of <soft power>”, and that Hungary’s current political gestures exceed the “Eastern Opening” political initiative, which, at the beginning, only targeted the economy and energy.
*C. Ioana is a graduate of the Master in Security Studies at the University of Bucharest and a LARICS expert on Hungarian issues.