Orbán says price caps could remain in force longer in Hungary

Portfolio
The ruling Fidesz-KDNP coalition has secured a two-thirds legislative majority in Sunday's parliamentary election. Prime Minister Viktor Orbán, as three times before, is holding a post-election press conference for domestic and foreign journalists. He said that he had spoken at length with Russian President Vladimir Putin on Wednesday and had suggested that a ceasefire be declared immediately. At the same time, he invited the Russian, Ukrainian, and French presidents, and the German chancellor to Budapest for peace talks. He said Hungary would have no problem paying for Russian gas in roubles if Moscow wants it that way. Without going into specifics, Orbán also said family support measures are planned to be extended. He also stated that the government intends to maintain the price freeze measures currently in place, and that negotiations will be launched with all stakeholders. Portfolio is reporting live from the event.
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Budget - 15:43

"We are a party of tax reductions, we will not raise taxes on the people," said Orbán when asked about the budget situation.

Whether taxes on multinational companeis will become necessary as they did in 2010 depends on the energy situation.

In the EU, these are called windfall profit, which can be used to fund certain budgetary institutions, he added.

There will be no austerity - 15:42

Austerity is out of the question in the next year, the PM stated.

Reducing dependence on Russian gas - 15:35

The gas demand of the Hungarian energy system will fall to 10% by 2030 if the Paks project is completed, said Orbán, referring to the government's plans to reduce dependence on Russian gas.

The long-term gas contract with Russia is important because of security, not because of price, he said in response to a question on the price Hungary would get gas from Russia.

Gas will not be available on the market, he projected.

EU funds - 15:25

It is an unacceptable distortion of competition that Hungary is not receiving RRF funds,

said Viktor Orbán.

Replying to a question, the PM said that it could become necessary to issue bonds if these EU funds were not transferred. Hungary can now have access to large amounts of funds on financial markets, he said.

If we have access to EU funds, we need to raise less money from the market, if we do not, we need to raise more money from the market, he said.

Government restructuring, skirmishes with Zelensky - 15:20

There have always been significant changes in the structure and in the world of people after previous elections, said Orbán, when asked what government structure we can expect in the future.

The formation of the government will not be quick, he admitted. There is a constitutional deadline of 3 May to form parliament. Putting together the government will begin after that, and the process will not be completed before the end of May, he projected.

This suggests that there will be reshuffles and personnel changes in the fifth Orbán government.

As regards his recurring clashes with Ukrainian President Volodymyr Zelensky, Orbán said - when asked about listing Zelensky among his opponents in his election victory speech - the problem with the president is that "he has a bad habit of wanting to tell everyone what to do. He should stop doing that."

Russia hacking Hungary's Foreign Ministry networks - 15:10

Investigative journalists at whistle blower site Direkt36 and news portal Telex have recently reported that Russian hackers gained full access to Hungary’s Foreign Ministry networks, and the Orbán government has been unable to stop them for years.

When asked about this, Orbán replied that "all Hungarian ministries are under constant attack."

I ask no mercy from anyone, so I have no complaints about those who attack us,

he added.

I am counting on Péter Szijjártó, it is his decision whether he will be a minister in the government, he said.

Price freeze and policy on overheads - 15:09

When asked if the price freeze on motor fuels and the policy on overheads of households in its current are sustainable, Orbán replied that there are deadlines for price cap measures. In any case, they will remain in effect until inflation causes such a huge headache and I would like to maintain them as much as possible in the future, he said.

We need to negotiate with the banks, with Mol, with fuel retailers and with food retailers, he added.

Later he said the sustainability of lower overhead costs depends on GDP growth and on the EU's decision on the three Hungarian proposals.

  • suspend the EU Emissions Trading System (ETS);
  • suspend the regulation linking the price of electricity to the price of gas;
  • suspend the mandatory blending of bio-based components into fuel.

Objectives - 15:01

Financial stability is the key. Success is the key to staying afloat after 12 years in government, Viktor Orbán said. Financial stability is a prerequisite for economic success, something I learned from György Matolcsy [former Minister of Economy and current Governor of the central bank (MNB)] but before 2010. But financial stability is not the opposite of economic growth - I learned that from him too.

The goal is for Hungarian growth to exceed the EU average, the PM said. He recalled that Hungary had recently overtaken Portugal in terms of GDP per capita. The aim is also that those with children should not live worse than those without, he added.

Alliance with the Poles - 14:49

You cannot stand alone in a storm like this. Our alliance with the Poles must be strengthened, said Orbán. It is a strategic issue, even if our foreign policy views differ. We need to be stronger on the issue of self-defence within the EU, he stressed.

Rule of law procedure, 'gender issues' - 14:52

We will wait until the letter on the launch of the rule of law procedure arrives, he said.

Whatever is in that letter, we will not give in to any pressure, so we will not supply arms [to Ukraine], we will not allow sanctions to be extended [to Russian energy] and we will not give in on gender issues, he explained.

The 'child protection' referendum held simultaneously with the parliamentary election was invalidated. While turnout was around 70%, only 44% of the votes were valid, while validity of the referendum would have required over 50%.

The legislation, passed last year, has triggered a legal probe by the EU Commission and bans on content that is seen as "promoting" homosexuality to children, including in the media. The commission previously said it was discriminatory and a breach of EU values.

Critics say the law was discriminatory, contravened European values and equates homosexuality with paedophilia. See the four questions and links to related stories below.

The biggest problem is the gender issue and the extension of EU sanctions to oil and gas. This is a red line, the PM clarified what they disagree with the European Commission and what could be an obstacle to the allocation of RRF funds.

According to him, the Commission's concerns on corruption have already been agreed between Brussels and the Hungarian government. We want to see investigations into the war issue, he added.

It's unclear what Orbán meant by agreement on corruption concerns, as rampant corruption remains one of the main issues the EC has with Hungary.

"In Hungary, corruption is the main problem, and we have made clear the exact course of the Article 7 procedure. The EU Recovery and Resilience Fund (RRF) has been the subject of ongoing discussions, where anti-corruption is the most important condition on our side.

We have been discussing the RRF on an ongoing basis, and anti-corruption action is the most important condition [but] we cannot close this open issue yet,

underlined European Commission President Ursula von der Leyen on Tuesday.

Crisis management - 14:46

We have reduced the adopted budget deficit. We also reduced the public debt during the election period. You will not find a government like this anywhere, he stressed. Orbán said that we are a responsible government and we will protect the financial stability of the country.

We will protect families from the effects of inflation, he added.

We will do our utmost to protect Hungarian families, the effects must be cushioned,

he explained in relation to the price cap measures introduced so far.

Putin and Russian affairs - 14:43

He called me, he replied to a question whether he called Russian President Vladimir Putin or Putin called him.

"Everyone who wanted to congratulate me did so", he added.

Hungary is a member of NATO, and the Russians are aware of this. We do not want to gather enemies, we want to gather friends, and we have made that clear. But they do not consider us friends now. They are not asking us for anything, they are Russians, said Orbán in response to a question on whether Putin had asked the Hungarian government by phone to reject EU sanctions.

We have built up a well-functioning system of relations, which is now being broken up. Sanctions and pressure from the West could lead to a situation where nothing remains of this relationship. One thing is certain: Russia will be and will be where it is now. And it is almost as certain that Hungary will be too. We understand this and they understand this, he added.

PM also spoke to Erdogan - 14:39

Russia is the aggressor, that is the EU position and we must avoid civilian deaths in war. I also spoke to Turkish President Erdogan on the phone yesterday and we agreed on this. The cases must be investigated, he said, referring to the alleged war crimes committed by the Russian army, which he called genocide.

Paks 2 - 14:35

Problems with Paks 2 could arise on the EU's side, because that is where the sanctions come from, said Orbán.

In general, we do not agree with the sanctions policy, but EU unity is important, he replied to another question. We are members of an alliance, so let it be, he added.

The issue of nuclear energy is not included in any package of proposals.

Therefore, the Paks investment can continue according to the previous contracts,

he projected.

I think there is also a geopolitical context to the much attacked investment (from home and abroad).

If it had not been for these attacks, this plant would be in operation by 2023,

and we would have had more room for manoeuvre in the energy crisis, especially in terms of gas independence, he explained. As I see it, this will not be a nuclear power plant in 2023. We have lost several years because of the attacks. We are now facing the consequences of that now, he said.

Hungary will pay in roubles for gas if Moscow wants it - 14:30

Asked whether Hungary is ready to pay for Russian gas in roubles, the Prime Minister said:

we have no problem paying in rubles. If the Russians ask for it, we will pay in roubles.

We had a Russian policy in our community. Then there was a turn of events: in 2008 it was decided not to admit Georgia [into the EU]. In 2008, this proposal could have been accepted but the West decided not to let them in. Then I understood that a new balance of power was beginning to take shape, and that was when I contacted President Putin. It was from then onward when it was clear that Russia would be part of the new security situation in Europe.

Until recently, we were going along these lines, but that is where things have taken a turn with this war. A new thing is beginning, but I cannot yet judge where it will lead, whether it will result in a new iron curtain, he replied.

The question is whether Ukraine will be a buffer state, for example, he noted.

A country the size of Hungary will not be able to decide these questions, and in the meantime we are trying to save what we can,

he said.

About congratulations on his victory - 14:26

When asked about the swift congratulations on his election victory by Russian President Vladimir Putin and the head of Belarus, Alexander Lukashenko, and related analyses that he is becoming more and more isolated because of his close ties with Putin instead of turning more to the West, Orbán replied that he was congratulated by many others, from "friends in Columbia" and Turkey (Turkic Council), for instance, as well.

"I have always found ridiculous the rumour that regularly recurs, that a member of the EU and NATO can be isolated," said Orbán when asked whether the post-election congratulations did not indicate that Hungary had become isolated from the West.

Orbán has just spoken with Putin - 14:20

In response to a question, he said that he had spoken on the telephone with former U.S. President Donald Trump yesterday and had conducted a "long telephone conversation" with Russian President Vladimir Putin today.

I suggested to President Putin that he should immediately declare a ceasefire,

he said.

Putin, the Ukrainian President, the French President and the German Chancellor should come to Budapest, Orbán told Putin.

The response was positive, but there are conditions, he added.

We have 200,000 Hungarians in Transcarpathia and we have a responsibility for them. They can avoid war if there is peace and a ceasefire in Ukraine as soon as possible, he said.

Urgent tasks - 14:17

Peace comes first on the urgent to-do list - starting with short-term tasks. The first step here is a ceasefire, followed by a European conference. He reminded that the war is getting more brutal and if there is no ceasefire, there will be more suffering.

The second important thing is to protect families. Europe is paying the price of sanctions, he said.

High energy prices need immediate action from Brussels. As long as the war continues, all administrative regulations on prices must be suspended. Here Orbán listed three necessary steps:

  • suspend the EU Emissions Trading System (ETS);
  • suspend the regulation linking the price of electricity to the price of gas;
  • suspend the mandatory blending of bio-based components into fuel.

International politics: this is what Fidesz believes -14:15

The government's vision of Europe remains unchanged. A government that believes in the nation state has been given a mandate. This is the foundation of our existence, and the idea of this will have a renaissance, Viktor Orbán said.

Adversities are international in nature, but effective responses are local.

Another pillar of the vision is to strengthen our alliances, he stressed.

WE CONTINUE TO SEE HUNGARY IN THE EU AND WE WANT TO PLAY AN ACTIVE ROLE IN SHAPING IT.

We want to build a much stronger army at home,

he stressed.

For the power coalition - 14:14

The Prime Minister attributes the victory to three factors:

Hungarians want peace. He recalled that the government had already started the peace mission before the elections and the war. First I tried myself, the little one was sent ahead, he said jokingly, referring to his moderate height. Then the Germans and the French, he recalled.

Hungary is a successful country. Hungary and Poland are the two success stories in Europe, with the highest GDP growth, the lowest unemployment and the highest rate of family support. And Hungary has implemented the largest tax reductions.

Orbán said the six-party opposition bloc failed because they teamed up only to get into power, which is "disrespectful" towards the voters. The Fidesz-KDNP coalition pursued a "campaign of the heart and devotion", he added.

What is expected? - 14:05

Based on the content of the previous three international press conferences, the following can be expected (or at least not excluded):

  • Identification of the most important (general) government goals and a flash assessment of the elections.
  • The expected direction and goals of economic policy. In 2010, Viktor Orbán talked about the tax regime and budget at the event, without giving specifics, though. In 2018, he stated that government policy would be focused on demographics, which in retrospect was the starting point of the family support and home creation measures implemented since then.
  • In terms of government views on the economic outlook, it will be of particular interest what the PM will say about GDP growth, inflation and the budget deficit.
  • Based on past experience, we think the PM may hint at a reshuffling of the government structure (less likely), possibly with new ministers, but we should not expect to hear names. It is interesting to note that while previously names of cabinet members had been leaked before the formation of the government, there is no such news now.

Beyond these, however, there are some current issues that journalists will definitely ask the PM about, and that will need to be the addressed by Orbán one way or another.

Read about these in more detail at the link below.

The European Commission's recent decision to trigger a new tool, the rule of law conditionality mechanism against Hungary is also almost certain to be addressed today.

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