Ministry of Foreign Affairs and Trade bails out its own debtor

July 17, 2017 -

The Hungarian National Trading House (MNKH) received billions of forints from the Ministry of Foreign Affairs and Trade, which oversees the MNKH, in order to pay back debts to that same ministry, reports news site 24.hu.

The MNKH, the national company that promotes Hungarian companies abroad, accrued a negative balance in four years of its five-year existence. Last year, however, the company turned a modest HUF 170 million (USD 636,140) profit. Despite 24.hu’s request, MNKH CEO Zsanett Ducsai-Oláh refused to disclose how the company managed to suddenly pull itself out of the red.

As a result, Politics Can Be Different (LMP) MP Bernadett Szél turned both to MNKH and the Ministry of Foreign Affairs and Trade with a public data request. According to the data provided by MNKH in response to the request, the company received HUF 2.75 billion (USD 10.3 million) from the Ministry based on a public service contract, and another HUF 2 billion (USD 7.5 million) from the manufacturing company of Felcsút mayor and oligarch Lőrinc Mészáros (which also paid the debts of a company owned by Prime Minister Viktor Orbán’s family members last year). By extracting this HUF 4.75 billion from MNKH’s 2016 balance, the apparent profit disappears.

This year the Ministry paid a total of HUF 3.5 billion (USD 13 million) to MNKH based on a public service contract and a support contract. Three years ago, the MNKH received a HUF 5 billion (USD 18.7 million) loan from the Ministry. It seems the Ministry is now helping out MNKH so that the latter can pay back its debts to the former. Meanwhile the average salary at MNKH – that is financed 100 percent from public funds – is net HUF 500,000 (USD 1,871) per month.

As a way of justifying the funds received through the public service contract, MNKH released a long list that provides a detailed description of all the company’s public activities:

  • MNKH takes part in the implementing of the foreign trade strategy politics
  • It also takes part in the elaboration of foreign trade strategy and politics
  • MNKH helps the Ministry of Foreign Affairs and Trade in carrying out the aforementioned foreign trade strategy and politics
  • MNKH keeps in touch with other government bodies under the supervision of the Ministry of Foreign Affairs and Trade
  • MNKH prepares and conducts negotiations assigned by the Ministry
  • MNKH is responsible for carrying out professional programs
  • MNKH also carries out other tasks assigned by the Ministry