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News in brief

VAT decrease on pork causes panic in poultry sector

Hungary’s poultry producers are in a panic as the cut to the VAT rate on pork from 27% to 5% as of January 1 has led to a significant drop in demand for poultry meat, and other food sectors are lobbying for similar VAT decreases, Hungarian economic daily Világgazdaság reported on February 1. Attila Csorbai, head of the Poultry Products Council, called the favorable tax on pork meat discriminatory, and told the paper that its negative impact can already be felt in the industry. He said that the industry is open to a similar VAT cut, the paper reported, adding that the council head is scheduled to meet György Czerván, state secretary for agriculture, to discuss the possibilities. Csorbai declined to give figures for the time being, although he noted that data will be evaluated as of the beginning of January, and exact figures will be published at a later date, the paper said. The fishing and dairy industries have already expressed openness to a similar VAT decrease, according to reports.

Hungary huddles with Visegrad partners over U.K.ʼs benefit ban plan

The Visegrad Group countries were hoping to take a joint stance during a meeting on February 15 regarding the U.K.’s recent idea to restrict the benefits accessible to its migrant workforce, Hungarian Minister of Foreign Affairs and Trade Peter Szijjártó told Reuters on February 4. U.K. Prime Minister David Cameron’s plan for reform of the European Union, announced earlier this week, included restricting benefits for other EU nationals working in the U.K., and this was reportedly a key point of contention for Szijjártó, according to Reuters. The foreign minister said he hopes that the Visegrad summit will help the group reach a joint and fortified position on the mattter, Reuters reported. The Visegrad Four countries – Czech Republic, Hungary, Poland and Slovakia – are the largest suppliers of migrant labor to the U.K. Hungarian Prime Minister Viktor Orbán and British Prime Minister David Cameron debated the subject during Cameron’s visit in early January, when Cameron discussed the benefit ban at a joint press conference and Orbán responded: “Hungarians are not parasites.” This measure could lead to other EU nations applying similar restrictions, Szijjártó told Reuters. President of the European Council Donald Tusk also recently put forward a proposal to suspend some of the benefits previously offered migrant workers from other EU countries for four years, Reuters reported.

EC approves €95 mln in funding for road upgrade in Hungary

The European Commission on February 8 approved the allocation of €95 million from the European Union Cohesion Fund to upgrade a 27 km section of road near Lake Balaton. The section of main road number 8 connects the cities of Székesfehérvár and Veszprém, in the northwest of the country, Hungarian news agency MTI reported on February 9. The road is part of the TEN-T network, which aims to close the gap between member states’ transport networks. “This project, forming part of the TEN-T network, will have a concrete and positive impact on industry, tourism and the quality of life of the people living in the wider east Balaton area. It will contribute to removing traffic bottlenecks, improving road safety and reducing noise and air pollution,” said Corina Cretu, EU commissioner for regional policy.

Hungary eyes new national carrier with Russian partner

Hungary’s National Development Ministry (NFM) has been in negotiations with Russian aircraft manufacturer Sukhoi to launch a new national carrier made up of six aircraft, state-owned news service hirado.hu reported on February 9.  The Russian company would provide Hungary with six new Sukhoi Superjet 100 aircraft, as well as financial support, to launch a new national carrier, according to the report. Hungary has been without a national carrier since MALÉV Hungarian Airlines went bust in 2012. The parties began negotiations in October, and according to their estimates, Hungary’s GDP could be boosted by an additional €110 million a year if a national carrier was launched, hirado.hu reported. Evgeny Andrachnikov, the deputy CEO of Sukhoi’s civilian aircraft production, told hirado.hu that a Hungarian national carrier would provide a great opportunity for Sukhoiʼs Superjet 100 aircraft to show its worth. State secretary László Tasó said that Hungary supports any project that is in the interest of Hungary and its citizens.

Official: Some 850,000 benefit from workplace protection program in 2015

Nearly 850,000 Hungarians benefited from the government’s workplace protection program last year, according to data revealed on February 9 by National Economy Ministry state secretary Péter Cseresnyés, Hungarian news agency MTI reported. Approximately 326,000 people over the age of 55, 160,000 looking for their first job, 30,000 longterm unemployed, 40,000 mothers with young children, and 290,000 people with low-level education benefitted from the program last year, Cseresnyés said. The program reduced participating employers’ payroll costs by HUF 135 billion, he added. The government provides tax cuts for employers and grants vocational training if they commit to establishing jobs for disadvantaged workers.

Hungary’s tax office recruits drones to crack down on  cigarette smugglers

Hungary’s National Tax and Customs Authority (NAV) acquired drones through HUF 20 million in European Union funding to crack down on cigarette smugglers, Hungarian daily Magyar Idők reported on February 8. NAV is planning to employ heat cameras, night goggles, recording devices and also hovercrafts in the near future to detect smuggling activities, according to the daily. NAV spokesperson Alexandra Sárközi said the office needs to keep up with the technological developments, adding that with the application of drones the office will be able to track smugglers without them realizing it. The spokesperson noted that NAV seized more than 43 million contraband cigarettes with a market value of about HUF 1.7 billion last year, along with almost 70 tons of loose leaf tobacco.

Paks nuclear power plant output edges up to 15,834 GWh

Hungary’s Paks nuclear power plant generated 15,834 GWh of electricity last year, 1.2% more than a year earlier, CEO István Hamvas said in Budapest on February 5, according to Hungarian news agency MTI. The power plant met 36.2% of domestic demand for electricity and generated 52.7% of the national output. The plant’s revenue edged down 0.5% to HUF 172 billion. The plant’s four blocks operated at 90.4% of capacity. In January, the plant began switching its operational cycle from 11 months to 14 months, lowering downtime for maintenance. The cost of the modification will be HUF 2 bln, but the move will raise revenue by HUF 3 bln. A HUF 600 mln turbine modification this year should boost efficiency, raising output by 30 MW, Hamvas said.

Orbán: Schengen ‘a dying institution’; migration is top security issue

Hungarian Prime Minister Viktor Orbán called the Schengen zone “a dying institution”, and also said that migration is the number one public security issue in the EU, during a press conference in the Bulgarian capital on January 29.  Following talks with Bulgarian Prime Minister Boyko Borissov in Sofia, Orbán said in a press conference that the “migration crisis” has so far been addressed as an economic and cultural issue, but that it must now be addressed as a security issue, according to the government’s web site, kormany.hu. Orbán was quoted as saying that the threat of terrorism is increasing while public security is deteriorating. Orbán singled out women and “the more vulnerable” as those most at risk and said that it is the duty of elected politicians to protect the citizen’s of their respective countries, kormany. hu reported. Orbán also highlighted what he perceives as a double standard in the treatment of Bulgaria, which is being excluded from the Schengen zone despite its exemplary performance throughout the “migrant crisis” in protecting its borders, kormany.hu reported. The question, Orbán added, is whether Bulgaria would even accept such an offer from “a dying institution”. At the same press conference, the Bulgarian prime minister said that real progress is only possible if the borders are closed until the current migrant crisis is resolved and that Europe must work together to establish rules and procedures, kormany.hu added.

LMP: Recording details corrupt practices in handling EU funds

Opposition green party LMP published a recording that it claims contains the voice of the current mayor of Szekszárd explaining to colleagues about the corruption involved in applying for European Union funding in this country, Hungarian online daily nol.hu reported on January 29. LMP spokesperson Ákos Hadházy said that the recording contains the voice of Rezső Ács, a member of the ruling Fidesz party and mayor of Szekszárd, and his current advisor Péter Máté, a former Fidesz MP, having a conversation at a party faction meeting in 2012, nol.hu reported. Hadházy, who has since switched parties, was also present at the meeting as a Fidesz MP at that time, Hungarian online daily index.hu reported. Nol.hu reported that the officials heard in the recording discuss how to handle applications for European Union funds in Hungary. On the recording presented by Hadházy, someone explains that, typically, an applicant promises to win a tender for a municipality, so long as the applicant is later hired for realization of the project, nol.hu reported. “This is how applications take place today in Hungary,” the person on the recording says, according to nol. hu. “They come here and say we will get it done completely – we win it for you, and we bring everything here. If you say no, I’ll go to the next city. Because I have a quota I can share, and if not here, I go to the next city. That is unfortunately what happens behind closed doors.”

Orbán objects after Obama highlights U.S. opposition to statue of anti-Semite

After U.S. President Barack Obama made a speech highlighting American pressure to stop Hungary from erecting a statue of an anti-Semite, Prime Minister Viktor Orbán’s office issued a statement on January 28 saying that the prime minister “strongly objected” to America’s “ill-advised” interference in the issue. In a first address to the Israeli Embassy by an American president, given on International Holocaust Memorial Day on January 27, Obama said that, in opposing the statue of Bálint Hóman, the U.S. made it clear that erecting the statue would seriously impact bilateral relations, according to a report by the Jewish Telegraphic Agency. “When a statue of an anti-Semitic leader from World War II was planned in Hungary, we led the charge to convince their government to reverse course,” Obama told a gathering at the embassy in Washington D.C., according to the JTA’s report. “This was not a side note to our relations with Hungary, this was central to maintaining a good relationship with the United States, and we let them know.”  In a response posted on the Hungarian government’s web site, Orbán’s press office conceded that there had been U.S. opposition to a statue of Hóman, who made anti-Jewish laws in Hungary in the World War II era, “but Prime Minister Viktor Orbán strongly objected to this behavior. In general, he said, pressure coming from abroad only hinders progress towards solutions to problems, and this was also exactly what happened in relation to the Hóman statue. The Prime Minister’s position is that an attempt of this nature by the American government was ill-advised.”

Polish PM visits

Polish Prime Minister Beata Szydlo lays flowers at a memorial for Polish victims of Hungary’s 1956 Uprising in Lot 301 of the Új köztemető in Budapest, the place where the Soviets secretly buried the bodies of the leaders of the uprising. During her February 8 official state visit, Szydlo and her Hungarian counterpart, Prime Minister Viktor Orbán, announced agreements to build a dual-lane highway between the eastern industrial regions of Hungary and Poland and to strengthen existing railway connections. The two parties are also committed to launching direct flights between Hungary and Poland, to depart from either Warsaw or Katowice, Orbán said.

Mohács burns anew

A costumed reveler on February 9 looms in front of the traditional bonfire lit in the Busó carnival celebrations, which take place every year on the last day before Lent in the southern Hungarian town of Mohács. The centuriesold tradition with pagan roots was brought by Serbian immigrants, and now coincides with the Catholic calendar, but it was originally a way to herald the end of winter. Marchers wear demon costumes to scare away the spirits of winter and the coffin of winter is burned in the bonfire.