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Weeklies on the Russian-Hungarian nuclear pact

January 27th, 2014

The headlines in Hungarian weeklies illustrate a growing controversy over the planned addition of two Russian-made blocks to the existing Paks nuclear power station: “The scandal of the year” (168 óra); “Eastern Block” (Heti Világgazdaság); “The business of the year?” (Figyelő); “Hungary hooked by Putin” (Magyar Narancs); “Change of Roles in Kissidonia” (Demokrata); “Paks Vobiscum” (“Paks be with you”; Heti Válasz).

In his regular 168 óra editorial, Tamás Mészáros remarks that striking a secret deal with Russia on the biggest investment project in Hungary’s history involved considerable political risks for the government, and wonders why it took that risk just weeks before the parliamentary elections. He speculates that the traditionally anti-Russian right-wing public may by now have been sufficiently imbued with the Prime Minister’s “incessant Europe-bashing rhetoric” to take that turn as another “feat of arms” rather than as a surrender. In his closing remark he suggests that Fidesz acolytes may hope to profit for a whole decade from the building process as subcontractors.

In Heti Világgazdaság (print edition), Ibolya F. Vitéz thinks Russia has been chosen to build two new nuclear power blocks because Hungary is not in a position to finance the enterprise from its own sources, while other potential competitors would not offer sufficient credits, except in exchange for a substantial stake in the new plant, which the Hungarian government was not ready to grant. On the other hand, she continues, the “Russian card” has been successfully played by Hungary in the recent past – last year, a mere visit by the Prime Minister to Moscow suddenly increased investors’ confidence and 3,5 billion dollars’ worth of government bonds were immediately bought at relatively low yields. Vitéz does not exclude the possibility that another thick package of government bonds will now be issued, in the wake of the nuclear deal with Russia. She also believes that the nuclear pact will promote the renewal of the long term Hungarian-Russian gas agreement on better terms for Hungary after it expires in 2015. Finally, the HVG analyst remarks that in the immediate aftermath of Mr Orbán’s visit to Moscow, Croatia has grown suddenly more appeasing at the talks on the controversial management rights of Hungarian oil multinational MOL in Croatia’s INA oil and gas company (See BudaPost 2011 through 2013). Croatia might in fact not be overly delighted if MOL sold its 49 per cent INA share to Russian gas giant Gazprom, in order to put an end to the controversy.

In Figyelő, Zoltán F. Baka quotes sources who claim that Mr Orbán’s talks in Moscow were much less friendly in tone than might be assumed from the official communiqués. In fact, the Hungarian Prime Minister did not accept the interest rate offered by President Putin and even refused to agree a compromise halfway between the rate proposed by the Russians and that requested by the Hungarian side, although that is considered in Moscow the established practice in international bargaining. Without an agreement on the interest rate to be paid on the Russian credit, Baka explains, it is virtually impossible to tell whether the new power blocks will be profitable.

In the same weekly, Tamás Felsman, a former deputy state secretary for energy, suggests that the electric energy to be produced by Paks II will be too expensive, unless it is subsidised by the government, in which case the European Commission would certainly take Hungary to the European Court. He also suggests that Hungary will not need new nuclear blocks until the 2030s, when the four existing reactors at Paks will cease production one after the other. In other words, the project is about 8 years early, and in eight years’ time we will be much wiser about the feasibility of potential alternative technologies.

In Magyar Narancs (print), the editor (Endre B. Bojtár) rejects the storyline that the Hungarian government has chosen a Russian-made nuclear power station as part of its delicate balancing act between two great powers, i.e. Germany and Russia. There is a different, “less romantic” explanation, he suggests, namely that “Mr Orbán has abandoned his former ally, the European Union and has tied the boat of his country fast to the Russian mother ship”. In an apocalyptic last paragraph Bojtár remarks that the only countries opting for Russia rather than the EU have been Belarus and Ukraine and both have been lured over by Russian energy carriers. “We are still facing free elections”, he admonishes the reader.

By way of contrast, in his weekly Demokrata editorial (print), András Bencsik, one of the organisers of three pro-government “Peace Marches”, outlines exactly the scenario discarded by Bojtár. If Mrs Colleen Bradley Bell was the ambassador designate to Washington of Kissidonia (an immaginary country), and if before her appointment she told her congressmen about her misgivings concerning the “rise of extremist parties” there, the State Department would surely ask Kissidonia to appoint someone else to the post, he writes. But she happened to speak about Hungary, which means, according to Bencsik, that Washington is sending to Hungary a “proconsul“ whose task it is to “impose a mandatory way of life on the primitive indigenous people, including: checks, balances, and marijuana”. By comparison, Bencsik continues, “Russia is the land of tolerance”. Hungarians, he explains have often managed to find the right balance between great powers, for instance between Austrians and Turks. This is exactly what she intends to repeat today with Russia and the West, and this is why Bencsik proposes to hold another peace march on March 29th “in support of the government’s balancing ability”.

In an aside, Bencsik compares critics of the Paks expansion to a Budapest rabbi, Izsák Schulhof, who wept over the re-occupation of Buda by Christian troops after 140 years of Turkish rule in 1686. Likewise, in our own days, not everyone is happy with the latest developments, the editor of Demokrata writes. In the heat of the ongoing “culture wars” (see e.g. BudaPost, January 23), Bencsik might have to face fierce criticism, however. According to legend, the rabbi fled Buda with an immense treasure in his carriage. In reality, however, most of the civilian population of Buda, Muslims and Jews alike, were slain or abducted as slaves to be sold by the occupying troops, who also killed the rabbi’s wife and eight year old son.

In Heti Válasz (print edition), Bálint Ablonczy suggests the government’s aim is to attract strategic industrial investments from all the great powers. Germany has a series of automobile factories in Hungary; Americans are strong in high-tech industry, while the Chinese intend to develop a logistical base linking the port of Thessaloniki in Greece with Western Europe. “The natural role which Russia can have in this game, is energy production”, Ablonczy explains.

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