Thursday, December 30, 2010

A Hungarian wind of change?

Among the members of the Eastern Bloc, Hungary was always the terrible child, the object of the envy of many of the comrades from the other side of the Iron Curtain. The events from 1956, the slow but firm opening of the economy to the market, the contribution to the fall of communism, by removal of the 150 miles border fence with Austria, in May 1989, and allowing East German tourists on holiday to escape to the West…There are only a couple of the main facts contributing to the European profile of Hungary. To this, it may be added the strong national identity and the persistence in supporting the country’s interests all over the world, through a well-organized and efficient lobby. After the end of the Cold War, Hungary succeeded in becoming a prosperous NATO (1999) and EU (2004) member.

From January 1st 2011, Hungary will take over the rotating presidency of the EU facing a difficult regional agenda, with the debt crisis on the very top of the priorities. But, in the same time, the conservative government run by Viktor Orbán is the subject of home and external criticism for various political initiatives: from the recent nationalizations to the intrusion of the state in the affairs of the media.

According to the law voted this week by the FIDESZ dominated parliament and waiting the signature of the president – who is having strong ties with the ruling party - , the new National Media and Communications Authority (NMHH), dominated by people loyal to the ruling FIDESZ party, will oversee all public news production and its powers will include levying big fines - up to 730,000 euros ($950,000) - or shut down news outlets which flout rules. The media is under threat in other former communist countries, but also in Italy, where the prime-minister Silvio Berlusconi is controlling the press directly or through its trustworthy representatives.

Despite international criticism from Luxembourg and Germany, and the mobilization of the Hungarian journalists (mostly on social media as Facebook or Twitter, but also through the local Hungarian 2.0 networks), the FIDESZ’s leaders announced that they will not give up. But, taking into account Italy’s precedent, many EU diplomats are already skeptic that those provisions will affect Hungary’s relations within the Union and, by thus, the freedom of movement as president of the 27-member bloc. Despite the protests of the OSCE  and of the European Parliament, the local authorities are denying any attempts to crack down on media. "It's very regrettable that the latest international opinions don't include any facts, only fears and threats," Peter Szijjarto, the Prime Minister's spokesman said in a release Thursday.

Hungary escaped financial meltdown in 2008 thanks to a bailout of the EU and the International Monetary Fund (IMF). The government's unconventional fiscal measures -- which include taxes levied on banks and mostly foreign firms and an effective nationalization of private pension fund assets -- have prompted ratings downgrades and elevated Hungary's risk premia as investors worry that the deficit could swell after 2012. Another controversial measure took by Orban's FIDESZ was the intrusion in the justice and the politicisation of the institution, after people loyal to the party were placed at the top of public institutions in a consolidation of power that is expected to continue. A phenomenon very familiar in many Eastern European countries.

Among the main tasks that Hungary will have to manage are: the talks on the 2014-2020 EU’s budget, the integration of Roma minority and the discussions whether Romania and Bulgaria are ready enough for joining the Schengen free-travel zone.

On the other hand, the powers of the six-month presidency were limited after the adoption of the Lisbon Treaty which created the positions of EU high representative and of EU permanent president, who will oversee the whole activity. Hungarian officials will preside over monthly meetings of ministers of agriculture, energy, environment, employment and, most crucially, of finances.

Viktor Orbán and many of its top party members used to be on the forefront of changes in Hungary, educated in the West, protesting against communism and supporting an economic liberal agenda. Little by little they turned the page to a conservative side and alienated most part of the media and the public intellectuals. The failure of the previous socialist party, rotten by corruption promoted their comeback in force, this April together with the resurgence of far-right parties. The further internal evolutions and the international behaviors will be decisive in the months to come for outlining the Hungarian profile in the 21st century, with a regional impact hard to estimate for the moment. And there are already too many question marks about this future.

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