Zsolt Törőcsik: In the European Parliament on Wednesday Viktor Orbán presented the programme of the Hungarian EU Presidency. The Prime Minister said that the EU’s situation is much more serious now than in 2011, the last time Hungary held the post, and that he had come to sound the alarm. The Prime Minister also made proposals on economic competitiveness and migration, the details of which I’ll ask him about now, as Prime Minister Viktor Orbán is in the studio. Good morning.
Good morning.
Before we get to the substance of the Presidency’s programme, let’s talk about the debate itself, because it was interesting that you spoke about Europe, about the tasks and challenges facing the Union, while the speakers in the debate – including Commission President von der Leyen and the President of the European People’s Party group, Mr. Weber – attacked the Hungarian government, its programme and measures. What could be the reason for this duality?
Indeed, I found myself in an interesting situation. I went there, as is appropriate: this is the Hungarian Presidency, we have a programme, it has depth, it’s a well-thought-out programme, and I think it’s an excellent piece of professional work. We have a very good team here, led by Minister János Bóka. We’ve put together a very high-quality programme. In addition, we’re not the only ones working on such programmes: the Draghi Report has also been published, so other serious countries and people are also dealing with Europe’s problems. So we’d have been able to have a fairly high-quality debate on why the European economy is in trouble, why the Americans and the Chinese are leaving us behind, and what we need to change in order to become competitive again. European money, people’s savings, are ending up in America, because the European economy is unable to use them properly. Then there’s the problem with migrants, which we should have talked about. We have a problem with the green transition: European businesses pay two or three times more than Americans for electricity, and we pay four or five times more for natural gas. How the blazes can we compete like this? So there’s a problem here that should have been discussed, and I had prepared for it. Now, by contrast, those who came together were obviously in a feverish state, and they weren’t at all willing to have a restrained, calm, intelligent debate on the biggest challenges facing Europe, but instead what they had in mind was a political slap fight, a brawl, a scuffle, a ruckus, a scrap – each according to their own taste. And they ruined it for us. When ten people come at you, that’s rock and roll. So there was rock and roll.
But what was the reason for that? Because obviously there are political parties who could be said to have been doing their job; but there, for example, was the President of the Commission, and the Commission is supposed to be a player which is above European politics, above the political divisions.
I was in a difficult position, because, after all, Hungarians are a polite, generous, well-bred people; so if you invite them to a debate like this and there’s a topic, that’s what they’ll want to talk about. But if you’re pushed in this direction, you have two options. You can let it go, and at first I thought I’d let it go and concentrate on the work; but so many people came at me, and so crudely, that I was afraid that if we continued to be gentlemanly there, we’d be taken for suckers. So I decided that we couldn’t let it lie, we’d have to get stuck in. We can’t afford to let anyone get away with that kind of behaviour toward us. I thought to myself that they were responsible for the situation, and they should be repaid in full. Well, everyone got what was coming to them, and a few slaps and smacks were delivered: I didn’t hold back, but brought out all my arguments, knowledge and insights, and I strove to defend Hungary. Well, I think everyone was shocked by this, so probably it wasn’t only me who was surprised, but also the Hungarian viewers, who have a completely different picture of Europe in their heads. We thought that there are intelligent people there. We thought that the MEPs must represent some European standard – even though, of course, there are some strange people there who say interesting things. In the Hungarian mind the term “European culture” connotes quality. We also tend to say bad things about Hungarian politicians, and I think there are many people who think that political debates in Europe are of a higher quality. What poppycock! Everyone was able to see that the standard was lower than the rear end of a frog. Quite a few people are probably in shock. I was also in a state of culture shock, watching them there, ignoring the facts, spewing hate, disregarding why we were there in the first place, neglecting Europe, ignoring the people of Europe, just hatred, just attack... But it’s subsiding, I’m over it now, and I’ve been able to think about the meaning of what happened there. I’ve tried to decipher the meaning of this from a Hungarian perspective, and I’ve come to the conclusion that if eventually we can see through the cloud created by this outrage and all these insults and lies, then what’s happened becomes quite clear. What’s happened is that the President of the European Commission and the leader of the European People’s Party – Ursula von der Leyen and Manfred Weber – have announced that they want to bring down the Hungarian government. They’ve announced that they want another government. And they’ve also designated who will form this prospective government – which will be what we could call a Brusselite government, because the current national, sovereigntist Hungarian government isn’t good for them. And they’ve said this openly. I’d always thought that this was what they had in mind, and you don’t need to be a Nobel laureate to figure it out. But the fact that they’re openly confronting Hungary and the world with this – that instead of dealing with European affairs they want to bring down the government of a Member State and replace it with another government – is unusual in its blatancy and shamelessness. And these two have also named the members of the new Hungarian government: the European Socialists want to delegate Klárá Dobrev, and they’ve pushed her forward and applauded her; while the European People’s Party and the Tisza Party have nominated Péter Magyar. And they’ve made it clear that this is the coalition whose contract – or marriage – has actually been concluded in front of us. Von der Leyen celebrated this like a priest, or a wedding registrar, Manfred Weber was the witness, and the two parties involved made it clear that they were ready to comply with what Brussels demands. This comprises four serious elements, and they’ve accepted all four. One is for us to become involved in the war in Ukraine: we’re to supply them with weapons and give them money from the Hungarian budget. It was clear that they support Brussels’ migration policy: let the migrants in. The laws on family protection and child protection must be abolished. And finally, we must join in the economic and trade cold war. This agreement was made before our eyes. So Brussels wants to delegate a Socialist and a People’s Party member to a prospective Hungarian government, who will then support Brussels’ most important goals, which are the cause of the conflicts between Hungary and Brussels. This will spell the end of sovereign Hungarian policy, and we’ll have a Brusselite government, and we’ll look like the Ladies and Gentlemen we saw there in the European Parliament. This is the meaning of what happened.
And in light of this, how can we talk about the real agenda? Because the Hungarian Presidency also contains proposals for the future of the Union. One of them is migration, for example.
Yes, but first of all, we have to make it clear that we understand that this is their plan, we’ve seen this marvellous little wedding ceremony, this public contract. But we’re here too – so not so fast! Maybe that’s what they want in Brussels, but that’s not what the Hungarians want. And maybe they want to delegate a government for us from the Hungarian Socialists and the Tisza Party, but the Hungarians will have a word or two to say about that. And we won’t stand idly by. This is why I had to step in and fight back, to make it clear that I understand that there’s such a political concept there, but we shall oppose it. And the Hungarians will want to decide for themselves what kind of government they want to have, with what kind of programme. It’s not acceptable for Brussels to tell us how to live and to send us their mercenaries to implement it and force it on us. That happened before, when they wanted to tell us from outside how to live. That won’t work! What marriage should be like, who we should let into the country, who we should go to war with, who we should trade with and who we shouldn’t trade with. Well, there was a time when we were told that. We freed ourselves from that thirty years ago. I don’t think the Hungarians want to go back there – that’s the past. So what I saw there was a Brusselite government to be delegated from Brussels to Hungary, which had the same body odour as socialism and the Soviet Union. We’ve moved on from that, and we no longer want it. This is a free country, and the Hungarian people will decide what things will be like. So the first and most important thing is that I made a declaration of resistance: we shall oppose this Brussels plan that seeks to delegate that kind of government to Hungary. What will be, will be, and we’ll commit ourselves to the ensuing conflict. This is what we needed to make them understand. They’ll accept it, because they’ll see that they’ll lose this battle. So public awareness, facts and honesty bode ill for such Brusselite ambitions. Our greatest allies are reality and public awareness. And I’ll speak openly – as I have just done. If I’m attacked for Russophilia, I’ll come out with the facts and say, “You’re the ones who have been secretly trading with the Russians, you’re the ones who have been buying gas and oil, albeit from Indian and Turkish refineries, and this is what you’ve been paying money for. So let’s talk straight then! Do you want this kind of battle?” I don’t think they do, because they have too much to hide. So I think they’ll calm down a little, they’ll assess this debate and realise that this isn’t a good deal. They’ll say to themselves, “Let’s go back to normal European politics, let’s leave the Member States alone, let’s leave Hungary alone. Let’s put aside these two puppets with whom we’ve signed contracts for them to go to Hungary. We’ll pay them some other way, let’s forget all that and go back to European-style politics.”
What are the chances of that? Because we can see that the attacks on Hungary aren’t abating – whether we think of the migration fine or other issues that are emerging as disputes, that seem to be emerging as policy disputes between Brussels and Budapest.
We have proposals. Firstly, I clearly remember when we had to deal with the consequences of the financial crisis of 2008. That was in 2011, the first time we held the Presidency of the European Union. And that’s when we created this special body of European prime ministers from the eurozone countries. And we said that the only way to deal with the financial crisis was to have a separate body to deal with the eurozone, the problem of the single currency; and this should comprise the prime ministers. This became the eurozone summit. And we said that we shouldn’t have the traditional European dialogue frameworks, but that we should agree separately on how to save the European currency. We aren’t a member of the eurozone, but sometimes we’re invited to this meeting. It’s a very effective body. It existed informally at first, then it was institutionalised, so we agreed on it, we wrote down that such a body existed and that it had powers. Now I propose, Hungary proposes, that we do the same with the Schengen Area. There are countries that are members of the Schengen Area – the area of free movement without borders – and there are countries that aren’t. And those countries that are part of this Schengen Area and that also have to defend Europe’s external borders from the outside should meet at the highest level – informally at first, then in an institutionalised body. They should make decisions there and not in the current European forums, because these are inefficient and don’t work: the state of migration shows that the current system doesn’t work. So we should let the prime ministers from countries involved in the Schengen system decide on it, on how the border is to be defended, how migrants aren’t to be allowed in, how they’re to be checked, and how they’re to be taken home if they’ve entered illegally. And let’s leave the Commission and the whole complicated structure out of all this, and let the prime ministers concerned decide on what’s to be done. Frontex, which is responsible for border protection in Europe, should report to this body, and we’ll steer Frontex away from being a tourist agency – as it is now – which actually transports migrants inwards, and towards finally becoming an organisation that’s involved in defending Europe’s external borders. This is the essence of our proposal.
Yes, but is there a receptiveness to this, or is there any point in talking about it until there’s a change of attitude in the EU with regard to migration? Because what we’re seeing, as you’ve pointed out, is that those Member States or those politicians who have stood up for strict border defence are being punished in some way.
But meanwhile the world is changing, because after all Europe is supposed to be a democracy, and people are not at all happy about what’s happening. Migration is bringing down governments. So there are those who have proudly promoted “Willkommenskultur”, the culture of “Welcome to you all!”, of “We can manage this”, and who believe that migration is actually a good thing – that decent people support admitting migrants, and only bad people oppose it. This is changing. People in Europe have lost their sense of being at home. Streets that used to be safe are no longer safe. Women aren’t going out in the evening. Crime is on the increase. People are endangered by shocking acts of terrorism. Supporting the whole migration system imposes a huge financial burden. Well, it doesn’t sit well with Western Europeans who may be in lower-paid jobs and working honestly for their wages, when migrants who aren’t working are getting paid roughly the same, or more. This is the European system, and it won’t be tolerated for long. This is why we’ve come to a turning point. This is why I said to Chancellor Scholz: “Welcome to the club, Mr. Chancellor, good to see you.” Or France’s new Minister of the Interior, who is way ahead of me – even though I also say tough things about migration. Or in the Netherlands. Well, the election there was won by the anti-migration forces, forces that were previously said to be in league with the Devil. They won the trust of the Dutch people. The whole of Europe is turning. It will take just a little longer before they fall in line with anti-migration policy.
The other thing that the Hungarian Presidency has proposed is competitiveness, increasing competitiveness. The fact that this is a problem is something that more and more people agree on, but everyone sees the escape routes a little differently. And in the EU we’ve often seen that everyone agrees on the problem but not on the solution; and ultimately this is the obstacle to action. What chance is there now of unity on finding a way out of this competitiveness trap?
There’s little chance of it now, because the positions are very far apart. Even though we hold the Presidency, Hungary has to deal not with Europe, but with itself. The truth is that for weeks now I’ve been focusing solely on the Hungarian economy. This intifada in the European Union and in Brussels – or this attempted crucifixion – was a diversion, because we need to deal with ourselves and with the Hungarian economy. Whatever Europe does, we’ve put together the action plan, the first big action plan, with which we’ll give new impetus to the Hungarian economy. I was working with the head of the economic cabinet all day yesterday, all afternoon, and now the concrete measures are emerging. So we’ll give a huge boost to the Hungarian economy. No matter what Europe says, we’ll maintain economic neutrality, so we’ll only accept from the West and the East what’s good for Hungarians, and we’ll reject anything that’s against our interests. So there’s a strategic and philosophical basis for what we’re doing. This economic neutrality will result in economic growth of 3–6 per cent. We won’t see that this quarter, or even in the fourth quarter, because then growth here will be somewhere between 1 and 2 per cent; but we’ll see a huge boost in the first quarter of next year, in 2025. We’ve identified three major intervention points. The first is affordable housing. This is what we really need to deal with now – let’s leave aside European matters, we’ve dealt with those, now we need to deal with our own lives. Affordable housing. Here we’re waiting for Budapest to say something, because the biggest problem is in Budapest. It seems as if they’re not occupied with that, but we have plans, and we’re ready to negotiate. So here we have complete concepts, from building halls of residence to helping young people get affordable housing, and even helping them with rent... These are in order. We’ll continue to support village residential construction in the Hungarian Village Programme. We’ll remove bureaucratic obstacles to enable people to use their accumulated savings as they see fit, for example to renovate properties, and release money they haven’t been able to use for the creation of cheap housing. So there will be a big housing boom. The second thing is that negotiations with the trade unions are going well. I think that we’ll be able to agree on the minimum wage and we’ll be able to agree on the level of wage increases. Ultimately this is for them to decide. I repeat that our goal is for the average monthly salary in Hungary to be one million forints – and I don’t think that this is unrealistic. Alongside this, we’re going to create workers’ loans. We have student loans for young people who are studying, and now we’re also going to give young workers loans to help them start their careers and their lives. This is also more or less in place. And our third big intervention point, our action plan, is for small businesses, who have been hit by inflation, hit by the war, hit by sanctions, hit by COVID. And there we want them to increase in size, to help them grow. It’s not yet official, because we haven’t received permission yet, but the working title for this is the Sándor Demján Programme. In this we’ll provide capital, low-interest loans, and all kinds of instruments to help small and medium-sized businesses to scale up, to take one step up in stability and size. So we’re going to intervene in these three areas: the Sándor Demján small business programme; on incomes, on workers’ loans and higher minimum wages; and on affordable housing subsidies and measures. Together these will boost the Hungarian economy, and this will become very clear in the first or second quarter of 2025. So I’ll focus on that, and then the Brusseleers can reap what they’ve sown.
What’s needed in order to have the budgetary room for manoeuvre to implement these programmes, to have the money for these programmes?
It needs growth. There are the developments, big developments. There are all kinds of development loans for them, from the European Development Bank or from China or from the European or Asian financial markets. This is something that can be financed, something that can be done. You can find resources for good investments – we just have to be clever in setting our targets and allocate our capacity well. In fact, for the things I’m talking about here, we need to generate the resources from the Hungarian economy’s own internal growth, while at the same time reducing the budget deficit and public debt. This is possible. This has been calculated, this has been planned, this is well under way, and the government will be discussing it soon. Yesterday the Minister for Economic Affairs presented me with the figures, the trends, the whole concept. Soon there will be a general government decision, which will set out tasks, and in a week or two I think the specific measures will come. And of course we’ll have to consult with stakeholders, with economic actors, and then ultimately we’ll have to discuss these measures with the people. In order to give the Hungarian economy a boost we’d like to create a kind of new settlement. Because if we need a new economic policy, and we need one, as we have to adapt to the changing world, then this also requires a new settlement.
There’s also the question of when these measures will be felt at the level of ordinary people, when they’ll feel them. Because if we look at the economic data, we see that in September inflation fell to 3 per cent, but at the same time consumption is a little slower in picking up – despite the fact that real wages have been growing again for almost a year now.
But September saw a pivot. Anyway, I don’t think the debate on consumption is a healthy one. After all, what is it about? You get your income. Now don’t let the Government or anybody, any economist, try to tell you what to do. Spend it? Well, you can spend it if you want to, but you might say you don’t want to spend it, you want to save it, because your child needs a flat or you want to replace yours with a bigger one. Or who knows what the future will bring? Or you might decide to keep it under the mattress. Well, that’s for you to decide. So I’ve never been a fan of economic policy debates that I, as a citizen, see as trying to tell me what to do with my money. After all, individuals themselves are the best people to decide on what to do with their income. They should be left alone. Instead you should offer them options and then they can choose. Even so, I think consumption looks quite encouraging in September, there’s clearly money, with real wage increases of almost 10 per cent. So if I deduct inflation from the wage growth, we’re left with an increase of 9–10 per cent – which I think is unprecedented in Europe. This isn’t the problem. What’s causing the problem is that the European automotive industry has slowed down, and the automotive industry is one of the key sectors in the Hungarian economy. Thirty years ago we wouldn’t have thought this about ourselves, but we’re a major automotive power. I think there are only three countries in the world where all the big German car brands are present: Germany itself, China and Hungary. And, in addition, now that vehicle production is switching over to electromobility, with electric vehicles replacing conventional drivetrain systems and fuels, we’ve invested a great deal in this and have launched a huge development project here. This is so that there’s no danger of having to close down traditional factories, leaving three or four hundred thousand people without jobs. This is why we’ve been at the forefront of this transformation, so today I can say with certainty that all the major car manufacturers will remain here in Hungary, because with the Hungarian government they’ve already agreed on the investments which mean that production in the car industry of the future will be kept in Hungary. I think this is huge. People don’t see this today, but in two or three years’ time it will be obvious that we were two or three steps ahead of the world when we converted Hungarian car production to electromobility. Part of this is battery production and many other things that are the subject of much debate; and of course people’s opinions must be taken into account and the environment must be protected, because we are one country. But I think that by adopting German standards this can be done, and then Hungarian car production will be given a new impetus. I’d put the date for this in the second half of next year. Hungarians don’t drive the cars produced here – or only a small proportion of them, as we sell them around the world. And when the world market develops so that these cars are needed, when car purchases increase again, then car production will take off in the second half of the year, when the new factories in Hungary come on stream. This is why I dare to say that the Hungarian government will raise economic growth in the coming year to between 3 and 6 per cent.
We’ve been talking about next year, and at the Ethnographic Museum yesterday you said that the year 2025–26 will be a year of recovery for families and small businesses, before we can get back to the big things, when planners can sharpen their pencils again. Looking to the longer term, what are the prospects for the Hungarian economy?
Bright.
I’ve been asking Prime Minister Viktor Orbán about Wednesday’s debate in the European Parliament, the proposals of the Hungarian EU Presidency, and new economic policy.