Prime Minister Viktor Orbán - Photo: MTI

Orbán addresses MPs: Hungary remains pro-peace, household energy price caps here to stay this year

Inflation will not be removed unless peace has been secured and Brussels has withdrawn sanctions, Prime Minister Viktor Orbán said on Monday in an address opening the spring term of parliament. The government can moderate inflation, however, and it intends to lower inflation to the single digits by year-end, he added. Orbán also said that on the first anniversary of the outbreak of the war in Ukraine, it was reasonable for Hungary to make it clear that it had not changed its position, and a parliamentary resolution by MPs of the ruling Fidesz and Christian Democrats stating that Hungary remains pro-peace and wants to stay out of the Russia-Ukraine war deserves support.

A clear declaration is needed because Hungary is under pressure daily, he said. “Everybody can see that they want to pressure us into the war”, and they want us “to join pro-war countries”, he said.

Hungary must endure provocations every day, Orbán said. “I ask you not to rise to provocations and we should stick to Hungary’s interests in the political arena,” he added.

In the past two months, as the Russia-Ukraine war continued, new EU sanctions were announced, and it is now clear that energy prices will not return to pre-war levels, he said. Even though European gas reserves have been replenished, the price of gas is three times pre-war levels, he said, adding that this had stoked inflation, with Hungary spending 4,000 billion forints (EUR 10.5bn) more on energy in 2022 than in the previous year.

The results of the government’s public survey on sanctions shows that Hungarians reject the EU’s sanctions policy, he said.

Orbán said it is projected that the economy grew by 4.6 percent in 2022 and employment hit record levels. Exports, he added, were similarly outperforming, and foreign investments in Hungary were the highest seen in more than 20 years. Last year, the budget deficit and the national debt both fell. Orbán also noted pension increases and an expansion of family benefits.

On the subject of the war, Orbán said the government was “observing with serious concern” how Europe was gradually “drifting into war”, noting that several countries were sending tanks and contemplating providing fighter jets to Ukraine. He added that there were those who wanted to send troops to Ukraine, too.

The prime minister said Hungarians decided in the April general election, confirmed by the government’s public survey, that Hungary should “stay out of the war” and not deliver weapons.

“I’d like the war to end as soon as possible; no one can win in this war,” Orbán said.

The prime minister warned of mounting deaths, the threat of hyperinflation, economic collapse, and the possibility of a global war. He repeated his call for a ceasefire and peace talks, noting that Hungary is advocating for peace in all international forums.

Orbán called China’s peace plan “important”, adding that Hungary “supports it”.

He said countries like Hungary which must import most of their energy were especially “tormented by inflation”. With its intensive industrial production, and without its own energy sources, energy slapped by sanctions leads to higher than average inflation, and more time would be needed to combat it. The government, he added, has introduced 20 measures with the aim of breaking inflation and protecting families, and it has also taken action to protect jobs, families and pensioners.

Orbán noted the government’s measure maintaining this year household energy caps up to the level of average consumption, adding that the average electricity bill would amount to half the market price, while gas would cost a quarter. Households are saving 181,000 forints each month thanks to the cap, which was “unique in Europe”, he added.

The prime minister noted that the government increased the minimum wage, which tripled between 2010 and 2023 — the fourth largest increase in the European Union.

The government also prolonged and expanded food price caps, and these will remain in place until inflation is brought down, he said. Also, the interest cap on retail loans is being extended, he said, adding the measure affecting 350,000 families will be scrapped only when interest rates start to fall.

Among other measures aimed at protecting Hungarians from financial pressures, he mentioned cheap national and regional bus and train passes to be available from May 1.

Orbán noted that small and medium-sized firms active in energy-intensive manufacturing have received state support of 220 billion forints, and this year 290 billion will be spent on a preferential loan scheme for small businesses.

He also mentioned 230 billion forints worth of state support for factories that implement energy efficiency measures, while the Hungarian Development Bank and Eximbank are launching a 200 billion forint loan scheme for large companies.

Also, the government has designed measures to protect Hungarian farmers, with a moratorium on loan installments and interest caps for 7,500 agricultural enterprises.

The government is also launching a plan to stimulate domestic tourism by providing tax relief for tourism businesses and speeding up the distribution of employee in-kind benefits that can be spent in hotels, he said.

Besides subsidies for commuters, the government has announced a scheme for companies hiring job seekers under the age of 25 or those unemployed for at least one month, with state support covering half of wage costs for six months, Orbán said.

Orbán said there were some who benefited from the energy prices caused by sanctions, such as the large energy companies that had record-high profits around the world. US companies supply gas to Europe at a much high price than they charge at home, which means that the profits resulting from sanctions are paid mostly by European companies and people in Europe, he added.

Hungary’s industry will be modernised and developed at a fast pace in the next decade, and favourable economic policies will be pursued for foreign investors, Orbán said. The new industrial policy will require more energy, which requires speedy decision-making, he added.

Decisions on developing green energy have been made, the Paks nuclear power plant expansion project is planned to be accelerated, while a decision has also been made to introduce gas turbine power stations, he said.

Meanwhile, the prime minister called the Nord Stream blast “a terrorist act”, adding that Hungary and Serbia had made it clear that if this happened in the case of South Stream, “they won’t get away with it”.

On the subject of child protection, Orbán said that in recent weeks the government had dealt with a “shocking and alarming paedophile case”. He said that the number of child pornography cases was “strongly increasing”, adding that “one cannot comprehend with a clear mind how this could happen in Hungary”.

He said “such cases should not happen in Hungary at all, especially not in schools”. The government has given clear instructions to the authorities to uncover all such cases, and heads of schools and local education officials have been instructed to ensure that “all such cases have immediate consequences.”

Orbán said such “atrocious cases” showed that “gender propaganda must not be overlooked”.

Referring to a government survey last year, Orbán said “3.7 million Hungarians rejected gender propaganda”. “Even if the whole world goes mad, and if Brussels excuses the inexcusable, Hungary must stay sane, an island in Europe in which families could safely send their children to school.”

Orbán asked all groups in parliament to cooperate “in the interest of protecting children”.

Meanwhile, Orbán said: “We Hungarians must always stand up for our co-patriots beyond the borders, especially in times of war.”

“We mourn Hungarians who died on Ukraine-Russian lines of battle,” he said. “It is painful that our co-patriots in Transcarpathia are suffering atrocities — even during the time of war,” he said, adding that their right to use the Hungarian language had been truncated and the directors of Hungarian schools replaced.

Hungary’s diplomacy must make it clear that Transcarpathian Hungarians “deserve more respect”, he said.

Orbán said that during 2023, Hungary would have to cope with the dangers of a prolonged war, inflation, and migration that continued to be a threat at Hungary’s southern borders. Meanwhile, support must be shown for co-patriots beyond the borders, Orbán said. He called on all lawmakers, regardless of party affiliation, to help Hungary overcome this dangerous period.

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