Government to take over energy providers

Népszabadság suggests foreign companies may be convinced that Fidesz will win next year’s parliamentary elections – hence the readiness of some to sell their utility shares to the state.

Economy Minister Zsuzsa Németh, who gives interviews only rarely, spoke on two radio stations on Tuesday to divulge that the government is negotiating with two foreign companies who intend to sell their utility providers in Hungary. The press has identified Italian public oil and gas giant ENI as one. ENI owns TIGÁZ, which runs a vast gas providing network in north-eastern Hungary. TIGÁZ was deep in the red, even before the government’s decision to cut utility tariffs by 10 per cent and its announcement of another cut to follow later this year (see BudaPost March 25)

In its front page editorial, Népszabadság suggests that the move by “less resistant foreign investors” can be interpreted as a forecast for next year’s parliamentary elections: “Investors reckoning with another four years of Orbán in government, prefer to pull out”. Prime Minister Viktor Orbán, the left-wing daily recalls, made it clear last year that he did not want utility providers to make any profit at all and he preferred those companies to be in public hands. When Hungary was in dire need of money, in the mid 1990s, Népszabadság continues, it sold the providers to foreign companies and guaranteed high returns on the investment. Now it is doing exactly the opposite: it is spending money in order to buy back utilities that make no profits. In a closing remark, Népszabadság accuses “the governing party” of being “actually rather fond of profits, provided they are made by their own people or friends”.

Tags: nationalisation, Orbán, utility tariffs