Merkel-Orbán conversations: Serious differences of opinion

Yesterday, right after Angela Merkel’s plane left the runway at the Budapest Airport, I jotted down my first impressions. It was a busy day for the German chancellor, so I had to be very selective in my post. I concentrated on Merkel’s comments, largely because they were the most unexpected elements in the exchange. Moreover, I talked mostly about her reactions to Hungarian domestic issues and spent a great deal less time on the disagreements between the two leaders over foreign affairs.

Let’s start with their attitudes toward Putin’s Russia. According to Orbán, Ukraine is important for Hungary because it is a neighbor of Hungary, because there is a Hungarian minority across the border, and because the gas that Hungary needs badly travels through this country. Therefore, he said, Hungary “can stand only on the side of peace. We can imagine only a solution that will take us toward peace.” But let’s see what Merkel had to say. According to her, the Germans would also like to have a ceasefire and political stability in Ukraine that “can guarantee the territorial integrity of the country.” Something Orbán didn’t talk about. Merkel also gently reminded Orbán that Hungary is not the only country that is dependent on Russian gas, indicating that it is unacceptable for Hungary to have a different viewpoint on the question of Russian sanctions.

That last remark from Merkel prompted Orbán to open a discussion with his guest on Hungary’s unique position in this respect. Germany’s situation cannot be compared to that of Hungary; “one must take Hungary’s situation vis-à-vis Russia very seriously.” Hungary has to renew her long-term agreement on the price of gas for the next fifteen years, and therefore “it is difficult to fully support the Russian sanctions.”

Although yesterday I talked about their disagreements over the meaning of democracy, I said nothing about how the topic came up during the press conference. Orbán naturally did not bring it up; it was Merkel who announced that during her conversation with Orbán she “indicated that although the Hungarian government has a large majority, in a democracy the role of the opposition, the civil society, and the media is very important.” She added that later she will find time to have a conversation with the leaders of Hungarian civil society. From Orbán’s reaction it was clear that the Hungarian prime minister did not expect such direct involvement by Merkel in a matter he considers a domestic issue. It was after these points of disagreement that Merkel and Orbán had their rather sharp exchange on the nature of “illiberal democracy.” As the Frankfurter Rundschau pointed out, Merkel can at times be quite “undiplomatic,” as she was this time, and therefore “she annoyed Orbán.” You can see the prime minister’s annoyance and his determination to follow his own path on the picture below, taken during their debate on “illiberalism.”

Source: MTI / Photo Tibor Illyés

Source: MTI / Photo Tibor Illyés

Csaba Molnár,  the number two man in the Demokratikus Koalíció, thought that Orbán was cowed and “behaved like a scared little boy standing by his teacher’s side.” I disagree. I saw exactly the opposite: a combative Viktor Orbán who will not be swayed by any argument and who will continue to build his illiberal state. I’m afraid the same might be true when it comes to negotiations with Vladimir Putin. Even though he might sign on to further sanctions, he will try to make a deal with Putin regardless of EU disapproval. It is another matter whether Putin will swallow a big one and give preferential treatment to Orbán despite the meager returns he can expect from Budapest.

As even the right-wing media had to admit, the visit was not a great success, although it was designed to be a showcase of German-Hungarian friendship and a stamp of approval by the German chancellor of the Orbán regime. What does Fidesz do in such an awkward situation? After all, they cannot admit that Merkel and Orbán disagreed on almost everything, starting with Russia and ending with the nature of democracy. The simplest and the usual Fidesz response in such cases is to resort to outright lying. This is exactly what happened today.

Vs.hu is a relatively new internet news site that came out with the startling news that the real significance of the conversation was in the realm of new German investments in the Hungarian economy. András Kósa, a well-respected journalist who used to be on the staff of HVG, just joined Vs.hu. He was told by unnamed members of the government and local German businessmen that although on the surface there was visible friction between Merkel and Orbán, in fact “concrete important industrial agreements came into being on Monday.” Siemens will be involved in the construction of the Paks Nuclear Power Plant. In addition, Hungary will buy thirty helicopters from Airbus, not from the American Sikorsky or the Italian-British AgustaWestland. Kósa was told that “BMW is contemplating opening a factory in Hungary.” Only the exact location remains to be settled. And, on top of everything else, Mercedes will build a new factory to manufacture a new model.

Well, that was quite a scoop. The Hungarian media went crazy. Dozens and dozens of articles appeared within minutes, and every time the story was retold it became grander and grander. While the original article emphasized that all these favorable developments “might happen,” by the time the story got to Magyar Nemzet it became “Gigantic German investments are forthcoming as a result of the Merkel-Orbán meeting.” Válasz discovered that the real significance of the meeting was that new “gigantic German investments are coming to Hungary,” obviously all that taken care of during a short luncheon. Even such a reputable site as Portfolio.hu fell for the story.

The first word of warning came from a specialized internet site that deals with the car industry, Autopro.hu. It is possible that economic relations were discussed, but it is impossible that there could be negotiations between Merkel and Orbán regarding concrete projects, the author of the article remarked. This is not the first time that the possibility of a BMW factory is being heralded by the Hungarian media, but nothing ever came of it. Moreover, if there are such plans or decisions, they would not be discussed by Merkel and Orbán but by the top management of BMW and Hungarian economic experts. Autopro.hu didn’t manage to get in touch with BMW, but they were told by Mercedes that at the moment they have no intention of building another factory. Later the pro-government Napi Gazdaság  learned from BMW headquarters that “the BMW Group has no plans to build a factory in Hungary.” I don’t know whether the rest of the story, about Siemens and Airbus, is true or is also a figment of the imagination of certain government officials.

I consider Kósa a reliable and serious journalist who would not make up such a story. But why would government sources leak information about nonexistent projects? What do these so-called high government officials think when they concoct stories that are bound to be discovered to be false? Perhaps they think that the false news will spread like wildfire, as it did in this case, and that the correction will be reported by only very few media outlets. Therefore, it can be considered a successful communication stunt. Fidesz is good at that.

57 comments

  1. “Merkel also gently reminded Orbán that Hungary is not the only country that is dependent on Russian gas, indicating that it is unacceptable for Hungary to have a different viewpoint on the question of Russian sanctions.”

    Mrs Merkel cited the German situation, saying that Germany depends on Russia for 30% of the gas supply in the country.

    While I am a great admirer of Mrs Merkel, regarding this comparison she was completely wrong.

    Germany has a dedicated pipeline between itself and Russia connecting the two countries, so this 30% supply is completely safe. As long as they can agree with each other this 30% of gas will always flow into Germany. Hungary however has an 80% gas consumption rate in the same regard, otherwise known as 2.6x times as much. That alone would invalidate the comparison with Germany, but more importantly this supply currently comes through Ukraine which siphoned gas from the pipeline in 2009, forcibly taking the gas for itself before it could arrive to European consumers.

    Even if the Ukraine could be considered a reliable country (never to repeat their 2009 behavior), the Russians already said that “in a few years” they will discontinue the pipeline going through Ukraine and close it down for good, so not a drop of gas will travel through it.

    Due to this aggressive Russian threat, the gas supply of Hungary is in complete jeopardy and under threat to the amount of 80%. This is an extreme threat, while on the other hand the German supply is completely safe, even though a small part of it comes from Russia it comes through a completely safe undersea pipeline, not a warzone and not under any threat.

    So either Mrs Merkel does not understand this situation, or she is satisfied that the German supply is completely safe and from that complete safety she feels comfortable to criticize others whoose supply is at risk from various problems.

    A solution is to have an understanding of the energy situation in Hungary (and to a lesser extent Slovakia) and start building solutions especially the LNG terminal in Croatia and the Croatian part of the pipeline that could carry the Gas from the terminal into Hungary.

    However I don’t see this happening fast, and much pressure would be needed to put on Croatia to start acting in a way that enhances the energy security of Europe.

  2. Eva, Orban’s whole government is built on lies, diversion, and deception. “Do not listen what I say” said Orban, and he kept that promise for the last five years. Honestly there is not a single surprise about the “leaks”. These were not “leaks” but well planned diversions.
    On Atlatszo it was just recently posted how Orban’s son in law was able to purchase some huge estate without any tender. Orban’s daughter studies in Switzerland from money gained in very funny ways. Pal Schmitt the plagiarizing, fraudster ex-president (elected by Orban) receives some medals, the cancellation of Sunday shopping will make thousands unemployed, the list goes on. Until there is circus and lies Orban can feed Hungarians with about imaginary factories and the greatness he will create, there will be status quo, and Angela Merkel will not come in the middle to make Hungarians believe how perfect Orban is.

  3. I am afraid what we can read here are lies and distortions. The author of this blog fell victim to the lies and distortions. They write:

    “I consider Kósa a reliable and serious journalist who would not make up such a story. But why would government sources leak information about nonexistent projects”

    But previously the same blog writes ” He was told by… GERMAN BUSINESSMEN… that although on the surface there was visible friction between Merkel and Orbán, in fact “concrete important industrial agreements came into being on Monday.”… ”

    First we are introduced to the fact that the information came from German Businessmen and two sentences later the blog pretends that the information came from unnamed government sources only.

    Lies and distortions indeed.

    A similar game is being played with the BMW announcement.

    The reliable journalist Kósa writes that there were advanced negotiations about a new BMW factory, though there are no decisions yet on where it will be. So some noname intern at a paper calls up BMW with the sentence “Is it true that you will build a new factory in Hungary?”

    And BMW sends back a standard reply that there is no such decision was made, it is not true that this was decided and other standard replies that they push out thousands of every day to newspaper inquiries. and then some journalists pick one of the sentence of the standard reply (or was the reply really just one sentence?) and publish it as if it were some big scoop.

    They are trying to ruin the reputation of Kósa to also try to ruin the reputation of HVG (where Kósa worked previously) and VS, two left-liberal publications.

    It is a standard smear tactic employed against liberal journalists, but the solution is to look at the original writings of Kósa. He never said the factory was already decided that it was a done deal, he only said they were negotiating about it.

    The one he said for a fact was that Siemens will have a big part in building Paks 2.

  4. “by the time the story got to Magyar Nemzet it became “Gigantic German investments are forthcoming as a result of the Merkel-Orbán meeting.” ”

    How ridiculous. Germany is a democratic country. It’s not Merkel’s decision whether or where BMW or Mercedes will open a new factory. These Orbanists are so stupid and desperate they fail to notice how out-of-this-world it all sounds.

  5. “Perhaps they think that the false news will spread like wildfire, as it did in this case, and that the correction will be reported by only very few media outlets. Therefore, it can be considered a successful communication stunt. Fidesz is good at that.”

    Exactly how it works – the seeds, once sown, continue to grow. The veracity of the story is irrelevant. The Right has been good at this for years – we’re currently going through a hurricane of it as we approach the general election in the UK.

  6. Incidentally, I can’t post comments on the Angela Merkel in Budapest post.

    Whatever happened the last time we had this problem seems to have happened again.

  7. Straying off topic a little – an insight into the Fidesznik view of Putin.

    My wife, who was mildly in favour of Putin (as a ‘strong’ leader), but otherwise pretty disinterested in Russian politics, has recently become a strong supporter of Putin and is convinced that all the problems in Ukraine are down to interference from the US and the West, and that Putin is only defending Russian interests.

    In my wife’s case, this might have something to do with the fact that she grew up in the USSR and is a fluent Russian speaker, who has many Russian friends in the UK (all of whom seem to be determined fans of Putin). But her opinions are undoubtedly also strongly affected by the daily dose of Fidesz propaganda she gets over the phone from her mother – which has become noticeably more pro-Putin recently.

    The official, public, stance of Orbán may be carefully pro-Western, but with pro-Putin overtones, but what the Fidesz faithful get is very different – and at the moment it is full-on pro-Putin, anti-West propaganda.

    The things Orbán says publically may be worrying enough, but what Fidesz says privately is frankly terrifying. I have always regarded comparisons between Orbániszstán and 30s Germany as overblown, but, with the added ingredient of Putin, I think these comparisons are now starting to look a lot more worrying.

  8. Paul wrote – at February 3, 2015 at 7:53 pm – his wife, and mother in law are Fidesz believers. Will they move to jobbik soon?
    Will they look into the eyes of the next generation with calm conscience?
    Will they claim that orban and the rest were not liars?

  9. Éva: You refer to an internet side of the car industry to try to dismiss the whole package of investments allegedly envisaged. I am afraid this is not a proper approach as here we are being confronted with heavy strategic decisions on military and nuclear energy industries as well. And these have to be decided by the highest echelons of politics.

    In the US the oil industry has an immense influence on Congress and US foreign policy. In Germany the same can be true for the car industry. Let us not forget that Helmuth Kohl’s former foreign policy adviser – and a mastermind of the entire German reunification process – Horst Teltschik retired from politics to the board of BMW and is currently also behind the globally respected Munich Security Conference.

    So what if the news is TRUE? For the US it means that they have again been outsmarted and after they failed to sell their second-hand F16s, this time they will again leave empty-handed with their Sikorsky military helicopter.

    Of course it also means an entirely new European political set-up.

    If it happens to be true, it also means that the whole impotent Hungarian opposition should be pensioned off with immediate effect.

  10. @cheshire cat

    But people are now happy and believe the rumors, because they are plausible and because they can now hope. One cannot unlearn these rumors. By the time it turns out that there will be no new factories people will be concerned with other things. Fidesz is masterful at this and these rumors carried the day for Orban.

    VS and its journalists just as HVG are under extreme pressure to increase traffic and Fidesz is great at using their willingness to write anything down, fact checking or using two independent sources are unheard of. HVG and Népszabadság lately became notorious about accepting and spreading the government spin without any criticism (while of course the fidesznik media would never even cover critical views).

    The fidesznik media was anyway satisfied how nice Merkel was, the not so fidesznik (although Vs.hu is owned by fideszniks) carried the bullshit stories and made Orban a hero, especially that the factory news totally displaced the news about other angles.

  11. Max, nobody outsmarted the US because the US never had a chance in Hungary to begin with. No Hungarian politician would want to become a pawn of Americans which is what happens when you decide to import American arm systems. According to strategists Americans would have too much influence if Hungary started to use their stuff and Orban is not letting that happen especially now that the relations are not the best. He is also showing to Putin that Americans are not gaining further influence. Orban – if this offer is true – would not give up anything by opting for Airbus, as he was anyway leaning towards that, as he could then be friends with the French too. It’s the best kind of compromise – offering something you anyway wanted to do. Orban forced such “compromises” on clueless szocis so many times he can’t even remember. He hopes he can do that with Western Europeans.

  12. Body language is everything but you’d never know it with the fine cutting by the news boys of
    Orban’s media, and the distracting, false voice-overs. Fact is, no Orban TV showed Orban’s answer to ‘Illiberal Democracy’ at which Merkel almost gave up her lunch. After the press
    conference, the photo op and handshake was as peremptory as Merkel could make it and retain
    her dignity. Then she marched off leaving Orban trailing behind like a lost puppy.

    “Can I go to the synagogue, too, please?”
    “No, stay and clean up your mess.”

    And of course, the exclamation mark to the whole day was the leisurely, extra 25 minutes–time
    she wouldn’t dream of spending with Orban–that Merkel spent with the ‘dreaded’ jews, to whom most Hungarians would rather ‘Give Gaz’…

  13. “Siemens will be involved in the construction of the Paks Nuclear Power Plant.”

    Siemens cannot be appointed by politicians to take part in the construction of the Paks extension. It must win a public tender according to EU rules. I would expect Angela Merkel to insist on the EU rules being followed.

  14. I cannot really understand what Orban means by ‘Illiberal Democracy” – does he mean government intervention in the economy when needed? Does he mean that his government is in total control of the Hungarian Economy? Does he follow/like some of Joseph Steiglitz (Nobel Price winning Economist) ideas? Does he believe in protectionism within the Free Markets to look after Hungarian interests first?
    The government’s communication is not very clear to me.
    Would somebody be kind enough to explain to me the above.

  15. @latefor

    The good thing about many words used by politics is that nobody really knows their meaning, so the people can think into such terms whatever they wish to.

    Orban himself would probably give three different definitions if asked on three separate occasions.

    Having said that people just hate “Liberalism”. After Fidesz’ relentless and extremely successful campaign It came to mean everything bad, a kind of politically acceptable replacement of the figure of ‘the Jew’. The good thing is that if you hate the “liberals”, then you don’t necessarily have to hate others, you did what was expected from you.

    So Orban was deliberately throwing in an inherently vague term (as there is no agreement what liberalism means in the first place) and created a controversy. As they say he successfully thematized political discourse and meanwhile he scored a lot because Hungarian people just hate liberals. So whatever illiberalism is, it must be good.

    It was such a great idea in fact that now MSZP – ever the laggard and always lacking original ideas – now openly defines itself as illiberal, I read it yesterday. Apparently MSZP figured out that its image is too liberal and that’s scary to rural voters who now decide elections. MSZP – people fear – would convert kids to gayness, bring more competition, would be soft on crime, bring more unruly gipsies on welfare etc. The solution: MSZP is now illiberal.

  16. Xander- Thanks for your enlightening comment. You have just made my day! (I can’t stop laughing!)
    Do you mean to tell me that from now on, nobody will support blow jobs at the National Theatre and all political parties will condemn exhibiting pieces of sh*t as a possible new art direction? How about that?!

  17. There’s more than enough material from the past five years to write a Hungarian version of Al Franken’s book, Lies and the Lying Liars who Tell them. How does this sound in Hungarian?
    Hazugságok és a hazudozó hazugok, akik hazudják.

  18. Xander: Orban himself would probably give three different definitions if asked on three separate occasions.

    I don’t think so.

    The Fidesz party line is quite consistent. The ideology is roughly that of the Salazar regime in 1950s Portugal (yes, they had elections too): organic-nationalist, ruralist, statist, conservative, corporatist etc.

    The difference is Portugal didn’t need EU money, so they didn’t feel compelled to use the word “democracy” at all.

  19. @Max, the trouble is that the BMW news is not true. Napi Gazdasság got in touch with them and the answer was that they have no plans to open a factory in Hungary. For me this is enough.

  20. @Eva S. Balogh – It looks like Yahoo News has taken down the story. At least the link you provide above no longer works. This would not be the first time that Yahoo News has run a bit of propaganda for Orban and crew. They sometimes have stories that are clearly from Putin’s spin doctors as well – occasionally including really nutty things about the US.

  21. Re no comments button: the last time this happened, commenters continued to comment–but used the previous day’s comment section. This seems to work well.

  22. According to Nezopont and Szazadveg (both Fidesz propaganda machines), Fidesz is improving and importantly, not falling any further and people are satisfied with the government. The temporary blip due to the via issue and related stories is almost over and with these results Fidesz is clear winner in the present election system.

  23. I tried, and it didn’t come up. But when I wrote “Hungary + BMW” the story did come up – and it is attributed to AFP, which seems odd because I have not been able to find it on the AFP website. If it is an AFP story, AFP should be informed. They’d be grateful for the correction. They don’t like to make mistakes.

  24. @Webber on correction. I tried to write a comment but I was unsuccessful. I do have a list of passwords but they claimed that none I tried was correct. So, I gave up.

  25. Re the reaction in Germany:
    That article by the Konrad-Adenauer-Stiftung is nothing special, “we have slight differences re liberalism …”.
    But the comment in the Pester Lloyd is extremely scathing for the Fidesz propaganda machine and its obvious and stupid lies!
    And it also is fun to read – I almost fell of my chair …

  26. A sensible article in Válasz. All that embarrassment concerning the unfounded stories about the gigantic investments could have been avoided if the government immediately denies the rumors. But at the very end of the article, the journalist expresses his hope that the BMW story was not a government PR stunt.

    The article, by the way, has the ironic title: “Rolls-Royce is building a factory in Hungary.”

    http://valasz.hu/publi/magyarorszagon-nyit-gyarat-a-rolls-royce-109254

  27. Eva, you can be proud!
    Searching for “Merkel Orban” on yahoo I found several HS-articles on the first page of results.

    Searching for that article I also was diverted to the site “yahoo maktoob” which is an Arabic one, really strange, but then I found it.
    http://news.yahoo.com/major-german-investments-hungary-despite-rights-issues-192718929.html
    Here’s part of the yahoo text:
    “Angela Merkel discussed major German investments including involvement in a Russian-built nuclear plant during her visit to Hungary, despite allegations that Prime Minister Viktor Orban has suppressed democracy, local media reported Tuesday.

    According to Hungarian online news portal vs.hu, citing Hungarian government and German business sources, German engineering giant Siemens will join the Paks nuclear plant expansion project.

    A diplomatic source, who wanted to remain anonymous because of the sensitivity of the issue, confirmed to AFP that Siemens’ participation in the nuclear plant has been discussed for months.

    “It counterweighs the Russians and keeps the Germans happy,” the source told AFP. Orban’s chief of staff Janos Lazar had said in December that Budapest was looking to bring in non-Russian partners on the project.

    Other major investment deals between Merkel and Orban included automaker BMW opening a new car plant and Franco-German Airbus supplying some 30 helicopters for the Hungarian military.

    German power company RWE has reportedly also agreed on a deal for Hungarian ownership in a power plant that the firm majority-owns to increase from the current 26 percent to 50 percent, the report said.

    A spokesman for the Hungarian government declined to comment.”

  28. Regarding the false information given by AFP to Yahoo. You an contact AFP to submit correction request here: http://www.afp.com/en/contact
    Include the source of news that uses AFP as the source of information: http://news.yahoo.com/major-german-investments-hungary-despite-rights-issues-192718929.html
    Provide the Napi Gazdasag link that based on direct contact with BMW confutes the news:http://www.napigazdasag.hu/cikk/35037/

    Regarding Nuclear deals: All interested parties should proceed via public tender as set out by the EU. There is no way to predict if the winner would be Siemens at this point.

  29. @Wolfi, This last sentence from Yahoo: “A spokesman for the Hungarian government declined to comment.” That’s it. Why didn’t they deny the BMW and Mercedes story?

  30. @Some1

    The story about Siemens was good because it was believable.

    Everybody knows that these public tenders are a sham in Hungary and so does Siemens. They are, just like Alstom etc. know it well and participate.

    Orban and his people decide and then they create a paperwork which are unassailable by even the strictest Brussels bureaucrats. (During more than 10 years of EU membership, I don’t think serious frauds were detected when in fact we know even the smallest procurements are decided by politics.)

    If Orban wants Siemens to win then Siemens will win and we know that Siemens will not complain too much about winning a huge tender.

    Siemens is based in Munich but also wields power in Berlin, so is the perfect friend for Orban.

  31. Coincidentally Siemens is also one of the most pro-Russian firms in Germany so I’m sure the Siemens people would love to work together with Rosatom.

  32. Apparently, for German companies such as Siemens, sanctions are serious. And apparently those who support the Hungarian government, who follow the old Leninist line of thought and are convinced that everything in the West is about money and nothing but money, are rather confused.
    Just two days ago I saw one of the “economists” who regularly speaks on Zsolt Bayer’s television show explain to people on Hir t.v. that Washington and all great powers will oppose any changes in the terms of Greece’s debt. Now we have Obama’s announcement in support of the new Greek government. I don’t even want to know how Bayer and crew will react (if at all): I’m sure they’ll find some way to spin that as Westerners making money and controlling the world.
    Marxist-leninist economic “thought” didn’t die, it just morphed into Fidesz.

  33. Another bit of news that just came up, and might be nonsense, is that the Hungarian government wants to buy a Russian-owned bank, Sberbank, and this is one of the topics Orban will bring up during Putin’s visit.
    If the Hungarian government does buy Sberbank, I predict it will be found bankrupt and closed.

  34. Apparently the Great Leader quite successfully managed to convince the Hungarians – even himself – of the “true” meaning of liberalism that nothing will stop him to propagate his very own interpretation of the term, as he promised.

    So, from dow on dear folks, we all should accept the Orbanian definition of words – instead of Oxford, or the Merriam-Webster, just to name a few – in case of word like ‘democracy’, ‘liberal’, and ‘illiberal’, because as we learned it all has different meaning in Hungary tan anywhere else..!

    How about it?

    I am pretty sure that ‘honesty’, ‘truth’ and ‘honor’ has totally different meaning there too..!

    Something seems to be quite constant, though, being an ignorant moron just as popular feature as ever, and it means the very same thing everywhere.

    Albeit, it has a great chance to change to a shorter version, like “don’t be such Orbán..!”

  35. I can’t believe that anybody would believe that during a conversation of appr. 15 minutes between Merkel and Orbán business deals are closed for BMW and Mercedes and Siemens. Do these people think that these companies are state-owned? And that even if these companies were state-owned companies that it’s Merkel who is making these decisions on her own during lunch?
    It says a lot about the level of journalism in Hungary that both right and left media take over such a bullshit story.

  36. @webber

    Sperbank’s purchase by the Hungarian state (through probably MKB) would be insane and even fideszniks know it.

    This is because there is no advantage whatsoever to be gained from the purchase.

    Sperbank Hungary (formerly Volksbank Hungary) is a laggard in every sense, its corporate portfolio is third rate, its retail portfolio small, it’s management systems bad, even the Sperbank people were surprised when they took it over, out of the many regional units the Russians bought the Hungarian Volksbank/Sperbank unit was the worst. It’s no wonder that the Russians would sell.

    At least Budapest Bank was very well run, MKB is huge with a giant corporate portfolio and an important retail portfolio too, a serious market share.

    Sperbank would be insanity or rather – we can safely assume – a serious part of the negotiated purchase price would flow back to Fidesz’ pockets because even the Russians know that its fair value is a fraction of the HUF150-200bn.

  37. In no way Merkel would lobby for any German company for any business deal with Hungary. Merkel is a full time, honest politician, not like Pal Schmitt or Orban who took this job on as a hobby. Merkel is a diplomat who knows the rule of engagement, and who is fully aware of all the investigations regarding EU tenders related to Hungary. Not that she would even consider to do something that is against the law, but she would not risk her good name and all of her career to benefit some Banana Republic by participating in secret negotiations. Orban, Lazar, Ader, Schmitt are not he kind of diplomats you would want to do business with and taken seriously. The Hungarian government for the last few years broken way to many promises in order to be taken seriously by any serious politicians. Merkel probably wanted reassurance from Orban that there will be no further “ideas” (taxes, fees, etc.) levied on German interests, and probably said that otherwise the expansion of any German business would become impossible. Probably this is the kind of “info” Orban and his minions made a run with.

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