Where are Hungarian-Russian relations heading?

May 2, 2017

Translation of György András Deák’s op-ed piece entitled “A marriage of pariahs” appearing in the April 13th, 2017 edition of liberal print weekly Magyar Narancs, (pp. 22-23).

It is symbolic, that in the future Hungary will probably pay more to Russia for the Paks expansion than it will spend on its own defence budget. And this despite NATO asking continually, and in vain, since 1999 for us to keep our promise and increase our expenditure. Instead, with a light stroke of the pen the government three years ago took on the huge burden of the Russian power plant, which it need not have done until the early 2020s, if at all.

This example clearly shows the great increase in importance of Russia to our country over a short time. The Russians have always been “under the bed” in Austria and Bulgaria, and Moscow’s influence has waned in Slovakia. By contrast, it has grown considerably here in Hungary after starting from close to nothing a decade ago. How did this happen, and what is coming next?

New tools

The current wave of Russian intervention in east-central Europe started in the mid-2000s. The “colour” revolutions of Georgia and Ukraine forced the hand of Moscow, where the dynamics in the post-Soviet sphere were seen as pointing towards further disintegration and, national sovereignty being consolidated along nationalist, crony capitalist lines, no longer requiring the active presence of Moscow. New tools would be needed to protect Russian hegemony in the region, and it was time to demolish a few myths about integration that dated back to the Yeltsin era. As was underlined by Modest Kolerov – director of a newly created department within the presidential administration charged with renewing ties within the region – there were no pro-Russian forces in these countries. External powers could not integrate them, although that is what they would promise the local elites. Meanwhile, with countries in the inner periphery heavily militarising, it would be a mistake to count on a peaceful future. It was clear that Moscow wanted to employ new methods in the future, while acting on an increasingly unilateral basis and with less regard for local factors. Everyone would have a role to play in this, especially the secret services.

It is almost certain that this new tool kit was deployed to some degree in the countries of east-central Europe that were at the time more Atlanticist and had newly joined NATO and the EU. Several countries in the region were propagators of the eastern expansion of Euro-Atlantic integration. In the Bush administration, they were seen as a remnant of the depleted circle of friends of the US, so the Russians had little left to lose. The first thing was to sow disunity and isolate Poland and the Baltic states, which were seen by Russia as hopeless cases. They used whatever ingredients from the recipe for post-Soviet influence building that could be applied in the given surroundings. They correctly assessed the extent to which nationalism was gaining ground, and sought allies in that quarter. They first circled around Jobbik and the Bulgarian Ataka in 2005. Since Russia’s economic might was limited, it had to “dangle a carrot” in the only sector it could: energy. In 2006, the idea of Blue Stream, later South Stream, was launched, and they began touting Russian nuclear reactors. Albeit with modest results, they even deployed a few websites in the region, such as regnum.ru, a news portal. It is likely that all this came in parallel with an increase in the reach of the secret services, and the honing of such practices as cyber-espionage and striking corrupt deals with elites. To make sure there were no misunderstandings, Putin made a tour of the region pretty much every year.

This model became so successful that it practically usurped the leading role played by traditional diplomacy – and not just in eastern Europe. There had already been warnings, such as Putin’s speeches in Munich and Bucharest. During the earlier Medvedev period a few alternative proposals had been made for in the field of global, or at least European governance and energy issues. Now they make no secret of the fact that they are not seeking dialogue or institutional solutions – instead there are sanctions, military interventions, party financing and hacking. This is not just a problem in Russia: in the 21st century, any intentions to improve the global order have slowly withered away. But Moscow was among the first to adapt to this new reality, and did not waste its advantage in this regard, exploiting it in a more ruthless and threatening way than the others.

Under the radar

Fidesz could already have come face to face with this gaining of ground by Russia before the elections of 2010, given it impacted the process of taking power in several areas. Above all, the Gyurcsány government’s flirtation with Russia gave them a last chance to at least partially rebuild their image as western democrats. More painful, perhaps, was the increasing strength of Jobbik, for which Russian money may well have played a significant role in the preceding years. The Moscow-backed disintegration of the “under one flag” conservative camp would have been seen as a serious threat by Viktor Orbán, not least because the “central power bloc” contrived to replace it had not yet been proven. The Fidesz leadership could also be sure that the roll-out of the NER [system of national cooperation] would cause conflicts with the US and European countries whose outcome was at the time unpredictable. While the latter was unavoidable, a confrontation with Moscow became unjustifiable and Viktor Orbán chose to avoid a war on two fronts. He wanted to at least reach a ceasefire during a short meeting with Putin in 2009, and presumably this is what he got.

What is more mysterious is what led from earlier keeping a distance to this intensive rapprochement. A mixture of greed and carelessness, or a lack of risk awareness? A desire to please the Russians, or to eliminate threats? One thing is certain: the balance in the relationship has so far not been in Hungary’s favour. A pliable Hungarian foreign policy, indulgence towards the secret service activity, and list of Hungarian orders from metro wagons to the Paks extension – these are all on the Russian side. On the Hungarian side we find an increasingly tarnished image within the alliance and Central Europe, exports that have fallen by half, a couple of gas deals and practically no orders from Russia.

But from close up, and particularly from Fidesz’s viewpoint, the situation is obviously a more nuanced one. It is worth noting that any problem of Russian influence is, for Fidesz,  largely a matter of indifference, beneath the radar. The political leadership does not share the western perception of a threat, and does little to hide its aloofness. The consequences of Szilárd Kiss’s visa bazaar were mainly borne by other countries in the Schengen zone; Orbán paid no heed. The espionage case against Béla Kovács was a problem for the European Parliament and Jobbik, while for Fidesz it was more an opportunity in the election campaign. As long as there are no harshly worded warnings from the western alliance, these are not strategic issues. Russian influence on Fidesz can best be understood in the context of internal power games. When Jobbik embraced the cause of autonomy for the Subcarpathian region at the time of the 2014 general election and war in eastern Ukraine, Fidesz quickly followed suit. It did this in the face of high-level warnings from the west, made publicly by Poland, and to the great joy of a Russian state media that liked the idea of Ukraine falling apart and its European neighbours clawing at the remains.

Through all this, Viktor Orbán is doing precisely what Moscow usually has to pay European radicals to do. The Hungarian prime minister has positioned himself as Europe’s enfant terrible – partly through necessity, partly through calculation, and not least because he is that way inclined. He subverts from within, criticising the system vocally and publicly. And when in full swing, most recently during the refugee crisis, he gives a glimpse of some kind of alternative to the prevailing – he would say liberal – mainstream. The strategic interests clearly do not intersect and, while he remains inside the European “family”, he does not hide within it and keep quiet, but loudly tries to gather disciples around him. His proclamations chime in a few areas with Putin’s world view, and his actions are precisely what Moscow expects from the European “political project”. Viktor Orbán’s image is marketable in Moscow, and the Hungarian government is not entirely alone – there is a part of the public that genuinely admires the chief ideologists of the system. The relations are not built on trust, but utilitarian – Russia is a potential sponsor that could offer some refuge if relations with the west were to seriously deteriorate. It would be foolish to reject this possibility.

And finally, as a consequence of these positive incentives, the whole range of profane business considerations turn up. Although we scarce count on the Russians in the less than successful diversification of EU export dependency (in the past decade, the EU’s share of exports has never been as high as it was last year) the circle of potential beneficiaries is not as small as it might seem at first glance. Russia is typically over-represented in the portfolios of Hungary’s largest firms. The nuclear lobby and the state-owned “national champions” set up in the gas sector can count on the Hungarian state and Rosatom or Gazprom in their battle with the European Commission over their market share. And, naturally, there is Viktor Orbán, whose household bill reduction campaign can depend on a little help from Moscow with small discounts and the odd order for his nicest companies.

Without friends

What will come of all this? It is perhaps hard to believe, but Viktor Orbán’s system gives a certain immunity against Russian influence. Political competition is muted and Hungary continues to be the prime minister’s one-man show. No executive powers can be established against his will, and no major issues can be handled without his knowledge. Fidesz’s nationalisation campaign and economic patriotism have hitherto barred Russian investors from the Hungarian market. There is no large Russian or greatly Russophile elite in the energy, media, real estate or financial sectors that could feel itself at home in the corridors of power. Nor would building from the ground up promise the Kremlin any rapid results. Nothing would be gained from the type of Moscow-backed demonstrations and disturbances that Lithuania and other post-Soviet regions have become accustomed to. Jobbik’s status is thus questionable: in the present situation there is no sense in treating the extreme right as an alternative. They could hardly succeed in knocking Orbán off balance in the short term, and would in any case lose his good will. Vona’s party is for now more suited to setting the agenda and influencing Fidesz.

By contrast, in Bulgaria legislative amendment bearing Moscow’s hallmark has made it onto the agenda in parliament, while in Slovakia, despite the best efforts of the foreign ministry, the “reverse flow” of gas to Ukraine was successfully blocked for two years. [When the conflict erupted between Russia and Ukraine, the former stopped delivering gas, and the European Union adapted the gas pipelines between Ukraine and Slovakia so that gas could flow east to the Ukrainians – ed.] The consultants that Miloš Zeman took from the business sector, or the treasurers from the Serbian socialist party are a good example of how high local brokers can rise in the state hierarchy. Compared to them, Péter Szíjjártó is a model of ascetic and ethical state officialdom.

So the strands come together in the hands of Viktor Orbán. The prime minister has not yet lost his head entirely, and tries to keep Russian relations within the boundaries of what is acceptable to Europe. After Putin’s visit to Budapest in 2015 he made desperate attempts to build bridges in Warsaw, Vilnius and Kiev. We complain loudly about the sanctions but act as a group, and along with the Slovaks and Greeks, we chant the slogan “we will not break European unity alone”. We hesitate to draw down on the Russian credit line for Paks, and perhaps not only because we baulk at the interest rate. The confusion that reigned and the anger of the forces of law and order after the murder of a policeman in Bőny could barely be concealed. Signs of caution and circumspection are now showing – the question is whether it is already too late.

Yet the situation is far from static. One of the main components of Orbán’s permissiveness is that the Russians can operate freely in the country, maintain contacts with the far right without interference, blithely build their secret service channels – and the government even gives them the occasional state contract. They can do what they want, except jeopardise Fidesz’s power in the short-term.

Not counting the Balkans. there is a kind of resistance and efforts being made to ensure that Moscow should not feel itself to be in the driving seat. This is precisely because, if we have learned anything from the last three years, it is that Moscow is prepared to go all the way where its interests demand it. For some strange reason, Russia has no friends or alliances in the world. When will the government realise this – and dare to act differently?

The author is an economist and foreign policy analyst.