Central Europe Review: politics,
society and culture in Central and Eastern Europe
Vol 1, No 8, 16 August 1999

Hungarian News Round-up C E N T R A L   E U R O P E A N   N E W S:
Hungarian News Round-up
News from Hungary since 9 August 1999

Paul Nemes

Gyorgy Bakondi, head of the government committee dealing with flood damage, has promised that schools damaged by floods damaged by this year's floods will be repaired by September and that those made homeless by the floods will get shelter by November. In some counties the work has already been completed but there are still about 1300 people who are staying with relatives or in community shelters. Bakondi said that full reconstruction plans will be prepared by this week. The government will provide HUF 1.5 billion to cover flood protection and another HUF two billion for building damages not covered by insurance. An additional total of HUF 14 billion will be provided by the Government for the reconstruction of roads, bridges and private properties, for agricultural damages and for building and improving water management systems. It has also been decided that flood victims can buy homes valued at less than HUF four billion tax free.

After Budapest City Council voted against the government's proposal to build the National Theatre in the city park's (Varosliget) Hungexpo area, Prime Minister Orban said that the government would look for a new, state owned, site for the National Theatre. Orban said that there are three or four suitable sites, and that one would be chosen within the next two weeks in order to finish the project by its 15 March 2002 deadline. The previous government had already excavated a site at Deak Ter, but the present government abandoned the project due to its UDS 70 million budget.

Lajos Fodor has been appointed Commander-in-Chief of the Hungarian Army (Magyar Honvedseg). General Fodor, who was trained in the former Soviet Union and the United States, replaces Ferenc Vegh who resigned last month. Fodor was head of the Reconnaissance Office of the Hungarian Defence and was also a monitor of the Hungarian delegation which prepared Hungary's NATO accession bid. Meanwhile, the number of employees at the Ministry of Defence and the Armed Forces could fall from the present 60,000 to below 50,000 as a result of the present review at the ministry.

Former football great Ferenc Puskas has been awarded the honorary title of ambassador of Hungarian sport by Prime Minister Orban in recognition of his performance in advancing Hungarian and international sport diplomacy. Puskas, the former member of the 'Golden Team' of the 1950s whose international goal scoring record remains unparalleled, said at the ceremony in Parliament that he was pleased with the honorary title, but that it would make him even happier if today's Hungarian football were more competative.

The Hungarian Commercial Bank (MKB), Hungary's second largest bank, stated on 11 August that it was delaying a planned listing on the Budapest Stock Exchange beyond 1999. MKB spokesmen said that "The bank's board decided not to initiate a listing of the bank's shares in 1999 due to a delay in the stabilisation in the regional environment [...] (but) the board intends to list its shares in the next few years as part of the bank's medium-term strategy."

The Independent Smallholders' Party has rejected FIDESZ's proposal for president. During official talks the major coalition party FIDESZ proposed Ferenc Madl, former minister of Culture in Jozsef Antall's government, as the parties' joint candidate for president. The Smallholders rejected the proposal and said they continue to consider Party Chairman Jozsef Torgyan as their candidate. Torgyan recently said that he was quite happy to carry out his "important" work as Minister of Agriculture and Regional Development and that the work of the President is largely "formal". He did not however irrevokably close the door on his candidacy.

Analysts say that Hungary's double-digit inflation in July was a surprise and that the figures are likely to be back to a lower, long-term norm next year. It was said that the one percentage point rise in inflation was caused mainly by one-off fuel and drug price increases, while food prices fell less than expected. Attila Torok of Postabank Securities said that a sharp rise in global oil prices also affected inflation but this pressure will ease as oil prices increase. Torok also said that inflation was likely to rise by about 20 basis points in the next two months and is likely to remain above 10 percent for the remainder of this year.

With Hungary's recent membership in the European Union's Fifth Framework Program on Research, Technology Development and Demonstration, Hungarian researchers have gained access to billions of dollars in grants. Hungarian researchers could receive a total of Euro 15 billion from EU research grants until 2002.

The Hungarian medical team assisting refugees in Albania will be withdrawn ahead of schedule. The withdrawal will now be completed by 25 September instead of October as was originally planned. Major-General Laszlo Sved said that conditions in Albania had improved more quickly than what was first thought, and that the Albanians can cope with the current workload.

Protocols of the Elder of Zion, a notorious antisemitic forgery by the Russian Tsarist secret police, has gone on sale in Hungary. Lawyer Peter Feldmajer, a prominent member of the Hungarian Jewish community, said that the work, published for the first time since the Second World War, must be banned. A spokesman for Flex 95 publishing house, which has brought out the book, said that the publication is not intended to incite antisemitic reactions but to "inform the public", and that banning the book would infringe on the freedoms of speech and information.

MOL, the Hungarian oil and gas company, has signed a letter of intent to merge with Croatia's state run fuel producer INA. If the merger goes ahead it would result in the creation of Central Europe's biggest energy company, with a market value of more than USD 3.6 billion.

The tourist attractions offered in Hungary during August are expected to make up for the losses suffered during the Kosovo crisis. The official forecast is that the Hungarian Grand Prix, the solar eclipse and the Pepsi Sziget festival will mean that tourist revenue for 1999 will rise to USD 3.5 billion - or one billion more than last year.

Gyorgy Szapary, Vice Governor of the National Bank of Hungary, has said that Hungary's economy will grow at a rate of four percent this year. He said that "Hungary has started [its] ascent on the cycle beginning in 1996" and that although the growth rate has been steady at five percent over the last two years, he is expecting it to lower to four percent because of the slowdown in the European Union.

Hungarian Finance Minister Zsigmond Jarai told a news conference on 10 August that the government has decided that spending cuts urged by analysts earlier this year were not needed. Jarai stated that "the development in June and July showed that we will have more revenues in the second half of the year than in the first half." In its budget draft the ministry estimates a six percent average inflation, 4.5 percent GDP growth and a public sector deficit of three percent of GDP for 1999 in its budget draft.

Tibor Szabo, the President of the Office for Hungarians Beyond the Borders, presented the plan for autonomy drawn up by six Vojvodina Hungarian groups to Steve Flanagan, US National Security Council director for European Affairs at the White House, on 11 August.

Paul Nemes, 13 August 1999





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