PM Orbán presents his vision to avoid new Cold War

Prime Minister Viktor Orbán said the West’s initiative to form blocs, in response to developments in the global economy, was nothing more than “a return to Cold War logic” in a presentation delivered at the Ludovika University of Public Service in Budapest on Wednesday.

EU’s competiteveness declines

Orbán pointed to the decline of competitiveness in the European Union outlined in the Draghi report and said the balance in the global economy was shifting to Asia, with “the most money, the biggest banks, companies and universities, and the most innovation and patents”.

He added that Brussels and Washington were trying to break the global economy in two, “with a vehemence reminiscent of the Iron Curtain”, noting USD 1.6bn earmarked recently in the US for an “anti-China information campaign”.

Orbán acknowledged backers of a “Transatlantic semi-European union” who saw economic blocs as a fact, while others, the French president among them, believed Europe needed to be strategically autonomous. Hungary’s sympathy lies with the latter, even though that won’t work as the backers of European strategic autonomy think in terms of a federalist EU, he said.

Orbán outlined the principles, the content and the political consequences of Hungary’s economic neutrality in the presentation.

Economic neutrality important

He said the principles of economic neutrality were “deciding with whom we do business” and doing business with whom it was “worthwhile to do business”, while negotiating “on the basis of our own values” and looking to “all four corners” of the earth for opportunities. He added that the West did not have a monopoly on modernity.

He said that Hungary would not do business through some other “centre of power”, but directly, while it would pick its business partners based on an assessment of competitiveness, not on an ideological basis.

He said Hungary did not want the products in which it traded to be “tied” to other factors, noting the suspension of the country’s EU funding after legislation to protect children was approved.

He said financial, investment, market, technological and energy neutrality formed the content of economic neutrality, while the policy consequences included keeping GDP growth in the 3-6pc, range, avoiding “debt slavery”, following a disciplined fiscal policy, acknowledging the necessity of new technology sectors, and reducing taxes.

EU’s economic growth has lagged behind

Touching on financial neutrality, he said Hungary needed to be present on markets in London, Japan, China and Arab countries to access financing. He added that Qatari and Chinese financing ties were a “first step”.

Investment neutrality, he said, meant that Hungary did not need to be selective when it came to foreign projects in the country. He held up the upgrade of the Paks nuclear power plant as an example, a project involving Russian, American, German and French companies.

He stressed that Hungary could not be left out of the technological mainstream, and that the country would build “the cars of the future and cutting edge green technology”, while adopting the “most widespread digital administration in all of Europe”.

He added that the policy of economic neutrality would also be present in the 2025 budget.

Orbán said the Draghi report touched on a “taboo topic” among those in the “bubble of Brussels”, while underscoring the importance of the focus of Hungary’s presidency of the Council of the EU: boosting competitiveness. The report showed that the EU’s economic growth has lagged behind that in the United States for two decades, while China has quickly caught up, he added.

He said it pointed out that the disappearance of cheap energy prices after the start of the war in Ukraine had shaved off a full year of GDP growth in Europe.

New competitiveness deal needed, Orbán believes

He said the report highlighted the continued “central role” of fossil fuels in the energy mix in the coming decade. The report was encouraging from the Hungarian perspective with regard to the improved outlook for the battery industry, while it pointed to the European automotive industry as an example of environmental policy being applied without regard for industrial policy, he added.

He said that Hungary’s EU presidency aimed to see a new competitiveness deal signed by EU leaders on November 7 or 8.

He said it was Hungary’s task, “if Brussels can’t manage it”, to outline the positive impact of a policy of economic neutrality on competitiveness. He added that Hungary was well suited for the task as its economic policy had been “free of ideology” for many years.

Hungary follower of ‘economic rationality’ – PM’s political director

Hungary seeks the best solutions to global challenges as a proponent of “economic rationality”, Balázs Orbán, the prime minister’s political director, said at a conference on Hungary’s economic neutrality at the Ludovika University of Public Service on Wednesday.

Hungary’s competitiveness cannot depend on the European Union, alone, Orbán said. He added that the country should continue to avail of the opportunities offered by the EU, in spite of signs of “institutional incapacitation” in Brussels and trade and economic policy that run counter to competitiveness.

Orbán said Europe was behind in the terms of innovation and R+D support, while it had produced hardly any of its own global tech companies. He added that the EU’s financing system was “anti-innovation”, supporting purposes that would neither create jobs nor boost competitiveness.

“Either we politicise or we support innovation,” he said, adding that innovation funding needed to be brought closer to universities and research networks “with a better understanding of what is worth supporting than Brussels”.

The EU needs its own defence industry, he said, adding that the bigger goal of a joint EU defence force “doesn’t appear realistic at the moment”.

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