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Belt and Road Initiative and Europe: Hungary (Policy Paper)

Belt and Road Initiative and Europe: Hungary (Policy Paper)


Main Findings:

Hungary has become the central point of Chinese economic engagement in Central and Eastern Europe. Positioning as a Central European country provides Hungary with the advantage of cheaper labour. As the European Union member state, access right to the Single Market is crucial for the country’s importance in the eyes of Beijing.

Complex networks of relations give leverage to both Hungary and China. On the one hand, Hungary, as one of the most criticized member states of the European Union in terms of illiberal practices, has negotiation power against the European Union thanks to excellent cooperation with major powers of world politics like China and Russia. On the other hand, China as the pioneer of the Belt and Road initiative has a powerful position in Europe by force of good ties with former communist states now member states of the European Union at Central and Eastern Europe.

Budapest-Belgrade railway

Winner of tender for the refurbishment of the Budapest-Belgrade railway line announced as a Chinese-Hungarian consortium at 25 April 2019 by the MFA of Hungary. However, the names of the partners in the consortium are still unknown. With the renovation of the railway line connecting Budapest and Belgrade, Hungary will be offering the fastest transport route for Chinese goods between South-eastern and Western Europe. The project itself is significant not only for the economic integration of Hungary and Serbia but also two countries’ further integration into the European Union and Single Market.

Issue of Trust

Despite all the pressures from America and Europe, Hungary is quite determined in terms of having 5G investments from China. Hungary regards this issue as a national security matter and the country’s decision on 5G technology is clear enough. For Hungary, it is possible, but not likely, to join US-led security themed grouping against China. The current administration of Hungary sees its European partners as hollow-hearted and has a political trust problem with them. When it comes to China, Hungary is enjoying a high level of trust. Overall, Hungary’s new positioning toward East mainly China is related to its own national agenda. Moreover, according to top-level actors, to have excellent relations with China, Hungary’s national interest.

The Chinese economic engagement in Central and Eastern Europe gave China extraordinary power to shape the European Union decision-making process. It is evident that this situation heaps of times resulted in divided Europe. The European Union must have a concerted policy and united stand toward China, this is existential than ever.

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