HUNGARY: Hungary's Victor Orban starts his third term as prime minister demanding autonomy for ethnic Hungarians in neighbouring countries.

Record ID: 565414

  • Title: HUNGARY: Hungary's Victor Orban starts his third term as prime minister demanding autonomy for ethnic Hungarians in neighbouring countries.
  • Date: 12th May 2014
  • Summary: BUDAPEST, HUNGARY (MAY 10, 2014) (REUTERS) SCREEN AT RALLY SHOWING PARLIAMENT VOTING ORBAN INTO OFFICE / PEOPLE CLAPPING
  • Embargoed: 27th May 2014 13:00
  • Keywords:
  • Location: Hungary
  • Country: Hungary
  • Topics: European Union,Politics
  • Reuters ID: LVA8QC66PV6MHYTNEXJZWTQLN9CG
  • Story Text: Hungary will stand up for its rights within the European Union and wants autonomy for ethnic Hungarians living beyond its borders in central Europe, including Ukraine, Prime Minister Viktor Orban said in his first speech of his new term.
    Orban, who was elected as prime minister for a second consecutive term by a new parliament on Saturday (May 10) after a landslide election win last month, said ethnic Hungarians -- who voted for the first time in the April vote -- supported his policies to unite the nation "above the borders."
    His previous government granted ethnic Hungarians in neighbouring countries Hungarian citizenship shortly after it took office in 2010, as part of his efforts to restore a battered sense of national pride.

    "We regard the Hungarian issue a European issue," Orban said in his first speech in parliament on Saturday. "Hungarians living in the Carpathian basin are entitled to have dual citizenship, are entitled to Community rights, and also autonomy."
    Orban, a 50-year-old former dissident against Communist rule, has also clashed repeatedly with the European Union over his go-it-alone policies in the past four years.
    Many Hungarians today view the 1920 Treaty of Trianon as a national tragedy because it took away two-thirds of the country's territory and left millions of ethnic Hungarians living in what are now Romania, Slovakia, Ukraine and Serbia. Orban has won popularity at home by reaching out to Hungarians outside the country's borders. He has never suggested re-uniting the lost territories with Hungary, but his activities have irked governments in some neighbouring countries.
    He said on Saturday that the issue of ethnic Hungarians was especially topical due to the situation in neighbouring Ukraine, where around 200,000 ethnic Hungarians live, who are entitled to Hungarian citizenship and also the right to self-administration.
    "The situation of the 200,000 ethnic Hungarian community living in Ukraine gives a current topicality to this issue. The Hungarian community there must get the dual citizenship, they must get all the community rights and they must get the possibility for self-governance. This is our clear expectation from the new Ukraine," Orban said, adding the new administration enjoyed Hungary's support in its efforts to build a democratic Ukraine.
    Orban pledged to continue the policies of his previous government and said these would be based on "open dialogue and bold thinking" when it comes to European affairs. He said Hungary was, beyond doubt, part of NATO and also the EU and his government regarded any programme that called for an exit from the EU a dangerous extremity. But, he added, Hungarians are members of these alliances and not hostages.
    His words echoed his ruling Fidesz party's campaign ahead of European parliament elections later this month, with billboards featuring Orban's photo and saying: "Our message to Brussels: More respect to Hungarians."
    Analysts said his combative speech signalled an era of new conflicts with neighbouring countries in the region. "The autonomy is a word that has a really negative connotation for the politicians outside the borders. So we can expect for sure stronger conflicts. We do not know the exact details because the autonomy in itself is an empty word, the question is what sort of autonomy he is calling for. But I'm pretty sure that he prepares for stronger conflicts with the neighbours and he even wants to strengthen these conflicts because he plays this freedom fighter image, he has to defend the country from foreign forces and this kind of conflicts, these symbolic, national conflicts can serve his own political interest and especially before the EP elections," analyst of Political Capital Peter Kreko said.
    Market analysts though expect a calmer era for some players, such as multinational companies.
    Orban has used his strong political mandate since 2010 to nationalise pension funds and hike taxes on banks and sectors such as energy and telecoms where foreigners are dominant. Such policies have stabilised public finances but alienated many investors.
    In his new term he will pursue strategies such as increasing state control over energy utilities and cutting personal income taxes further, according to analysts polled by Reuters and sources who did not want to be identified.
    However, some of those interviewed think that in the later part of Orban's next term, there could be an easing of the measures that have hurt some sectors, especially foreign banks, and a softening of approach towards service sector investments.

    "We expect less fight against the EU, against the multinational companies, less communication against these institutions and these companies. But we still believe that the banking tax will remain intact in the next four years because that's a very important element of the budget but towards other companies, for example energy companies the attitude could change somewhat. And what we believe is that this is supported by the much better situation of the macro economy in Hungary," chief economist of Erste Bank Gergely Gabler said.
    In a Reuters poll of 21 analysts conducted between Feb. 25 and March 4, most expected increased state intervention in the economy and new measures that could deter foreign direct investment.
    Orban is expected to stick to efforts to rebuild public finances that freed Hungary from EU disciplinary measures. But analysts expect new rows with Brussels after four years of conflict over changes to the constitution and to media laws.
    They see Orban pursuing efforts to reduce foreign stakes in energy utilities, instead putting more of the sector into state hands in the belief that cheap energy will be key to long-term economic success.
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