US Imposes Sanctions against Hungarian Citizens

US Imposes Sanctions against Hungarian Citizens

The United States and the European Union have unleashed a «war of sanctions» against Russia. Now many start to doubt the wisdom of this policy. The world markets face another downfall to bode ill as a new economic crisis starts to loom. The European Central Bank has failed to find additional financial incentives to drag the European economy out of economic slump. The Bank’s efforts to introduce emergency measures hit snags on the way because Germany opposes the policy. «People are really concerned about the European situation and the deterioration of economic numbers we’ve seen», says Walter Todd is Chief Investment Officer/Managing Director at Greenwood Capital Associates LLC. (1) 

The International Monetary Fund has come up with downward revisions for world economy. The top management of US Federal Reserve System admitted that it can negatively affect the national GDP growth. 

«We’re likely to see more volatility», said Tim Schroeders, a portfolio manager who helps oversee $1 billion in equities at Pengana Capital Ltd. in Melbourne. «As growth continues to disappoint, there’s ongoing concern about geopolitical risks and the spread of the Ebola virus.» (2)

This is the background against which Washington and Brussels want European countries to suspend many profitable joint projects with Russia. No wonder the resistance to the pressure is on the rise. 

Jackson Diehl, deputy editorial page editor of the Washington Post, writes, «So let’s consider Hungary, a NATO member whose prime minister recently named Putin’s Russia as a political model to be emulated. Or NATO member Slovakia, whose leftist prime minister likened the possible deployment of NATO troops in his country to the Soviet invasion of 1968. Or NATO member Czech Republic, where the defense minister made a similar comparison and where the government joined Slovakia and Hungary in fighting the European Union’s sanctions against Russia». (3) The author points out that all the countries mentioned in the article are NATO members. Further the author expresses his concern over the fact that there are strong pro-Russian sentiments in Serbia, a candidate for EU entry. Jackson Diehl admits that many NATO members are tacitly angling to side with Moscow. 

Actually Europeans are compelled to make the choice they are not ready to accept and would like to avoid. 

The US decision to impose sanctions against some Hungarian politicians, businessmen and tax officials has evoked a shock reaction in Budapest. Even the European Commission has not dared to do anything similar, no matter it has many times accused Hungarian Prime Minister Victor Orban of violating EU regulations and standards. No wonder! There is something important at stake – the fate of the most important endeavor ever undertaken since the Second World War. The goal is to use sanctions and other means of pressure to subjugate Russia and make it serve the vital interests of the West. Hungary has happened to be a «weak link» among the European Union’s ranks. 

Actually Hungary leads a group of nations inside the EU that are reluctant to follow the anti-Russian policy of Brussels and Washington. 

Hungarian Foreign Affairs Minister Péter Szijjártó has criticized the EU’s policy of sanctions against Russia questioning their effectiveness for spurring the process of de-escalation in Ukraine. «These sanctions have not given us the result we hoped for in Ukraine – the conflict is clearly not de-escalating. Meanwhile, Europe’s economy is suffering and central Europe has suffered the most», he said. (4) So far, Hungary is losing Ft50m each day due to the sanctions regime, according to Mr. Szijjártó. «Russia is our third largest trade partner and unfortunately we have lost 12 per cent of our exports to Russia and CIS so far this year», he said. (5)

The Hungarian neighbors – the Czech Republic and Slovakia – stick to the same position on the sanctions issue. Some EU «old timers» like Finland, for instance, that have suffered significant damage as a result of the «war of sanctions», start swinging to their side. 

All told, the propaganda story of European «unity», or Europe united under anti-Russian slogans, does not ring true anymore. The plans of US President Obama to isolate Russia have been stymied. The United States itself looks more and more isolated. The countries of Central and Eastern Europe, that have always been instruments to implement the policy aimed at reaching US geopolitical objectives, now express discontent. The Washington Post is right saying that President Obama did not notice how «Russophobes’ in Eastern Europe had left the place to politicians who are not ready to sacrifice national economic interests by severing ties with Russia to serve the goals set by NATO. 

There are new political events ahead, in particular, the meeting of the EU Committee of Permanent Representatives slated for on October 28. According to the sources from Brussels, the agenda includes «a review of the situation in Ukraine in order to identify the possibility of a revision of sanction against Russia». At the forum the opponents of sanctions may join together putting in doubt the anti-Russia sanctions policy initiated by Washington and Brussels. 

Washington wants to «stay one step ahead». The United States could not openly say that banning Hungarian citizens from entry was an act of punishing Budapest for disobedience on foreign policy issues and a warning signal to other European states. The officially stated justification of the black list is tax irregularities applied to US companies. The tax problems have been part of the agenda for many months but the choice of the moment to react is indicative. Hungarian media is puzzled. The US says it is concerned over the Hungarian tax system. Then why does the ban include the head of think tank and research center Century Economic Research Inc. (Századvég Gazdaságkutató in Hungarian)? The think tank is linked to Fidesz, the Hungarian ruling party. Some businessmen are also blacklisted. Hungarian Voice Internet news blog says the real reason for the ban is not the discontent provoked by Hungarian leaders’ statements, but rather the general trend of «rapprochement between Russia and Hungary». 

The economic crisis in Europe had made the Hungarian government keep away from many steps taken by Brussels before. The sanctions policy imposed by the United States and the European Union has only made Budapest lean more toward independent foreign policy. Of course, the NATO and EU membership presupposes serious restrictions but the general shift to self-determination is obvious. That’s what causes the Washington’s displeasure, not the problems with the tax collecting system that hinder the activities of US companies in Hungary. 

Hungary encounters problems with the European Union. Tibor Navracsics, a candidate to become one of the members of the European Commission, was found unfit for the job of Commissioner for education, culture, youth and citizenship. The competent parliamentary committees hold two votes for each candidate - one on his competences and one on whether he is appropriate to take a post. In this way, the former foreign minister of Hungary proved competent to be Commissioner but inappropriate to take the post. The candidacy was dismissed by the very same majority that had demanded to sever the ties with Russia. 

Among other things they cannot forgive him what he has said to Die Welt in an interview. In the capacity of Hungarian Foreign Chief he told the German newspaper that the introduction of sanctions will only distance Russia from Europe. The first signs are already emerging. China and other states provide Moscow with what it does not get from the West anymore. Now Russia redirects its energy supplies to these countries. European Union sanctions will only make Russia turn away from Europe to weaken the old continent. According to him, Hungarian Prime Minister Victor Orban is not the only politician with this view, but he is then one who has said it most clearly. (6) 


5. Ibidem
6. «Russland wird sich von Europa abwenden». Die Welt [online edition, 5 September 2014]. 
Tags: European Union  Hungary  US  Orban