Hungary in the world - the world and Hungary
The objectives of Hungarian foreign policy worldwide serve the peace, security and welfare of the nation, foster the success of European integration, good relations with our neighbours, and to participate in international cooperation for staving off global threats.
A people in the heart of Europe : Hungary is a medium-sized country with ten million inhabitants, scarce resources, looking back on a thousand years of statehood. The Hungarians – whose closest relatives in Europe are the Finns and the Estonians – are renowned for their resourcefulness, creativity, and pride themselves on their hospitality and openness. Historical experience has encouraged the Hungarians to be open, cooperative and understanding – values that are also embedded in the role that Hungary plays in the international arena.
Democratic change and foreign policy : At the end of 1980’s the communist regime in Hungary collapsed swiftly and without bloodshed. At the beginning of the 1990’s the country successfully created a well-functioning democracy and market economy. The transition would not have been possible without the progressive traditions and experiences of our history like the Revolution of 1956 against the communist dictatorship. The change of the political regime entailed a change of values. Just like the country, Hungarian foreign policy also underwent fundamental changes, its objective became to join the community of Western democracies – NATO and the European Union. As a result of the policy of its successive democratic governments, the performance of the country, and the widespread social and political consensus Hungary became a member of NATO in 1999, and a member of the European Union in 2004. Its novel status determines the place and endeavours of the Republic of Hungary in the world – its foreign policy serves the interests of the nation and the common political objectives of the European Union at the same time.
A uniquely Hungarian national cause : sizeable Hungarian communities – amounting to some one-third of the nation – live outside the borders of the country in the territory of the neighbouring states as a result of the peace treaties closing the First World War. These communities – despite the tribulations they have endured in history – have managed to preserve their Hungarian identity and culture. European integration provides a historical chance to unify the Hungarian nation in a European framework. Thus it is understandable that Hungarian foreign policy – while respecting the universally accepted principles of the protection of minorities – lends support to the endeavours of the Hungarian minority outside the borders of Hungary to preserve their communities, including their wish for autonomy in line with European principles based on a consensus between the majority and the minority. Improving on the situation of the minorities, the extension and codification in international law of their rights are important endeavours and are part of the new foreign policy of the democratic Hungary.
Globalisation : Both its favourable and adverse effects can be felt in Hungary. Hungarians are also concerned about the trends threatening the development of the world economy, the rivalry for the limited energy resources, increasing protectionism, the aggravation of problems caused by poverty and underdevelopment. Events of the recent past have provided dramatic evidence that whole regions can be shaken by fast spreading pandemics or environmental catastrophes. The position of the Hungarian foreign policy is that managing the consequences of globalisation requires the coordinated intervention of the international community as a whole, and in particular the intervention of the developed democracies. It is imperative that there should be regular dialogue and cooperation, and assistance in globalisation issues should be extended.
Hungary is a member of the European Union: Hungary - as a member state of the European Union – wants to make full use of its enhanced opportunities due to its membership, and meets the related obligations, is committed to the deepening of integration and to the extension of cooperation within the community. Hungary was one of the first countries to ratify the Constitutional Treaty. Hungary participates in formulating the Common Foreign and Security Policy, where it pays special attention to the issues related to enlargement and neighbourhood.
Hungary wants to preserve the results that the EU has achieved so far and the well-functioning community policies, while it lends support to the necessary reforms too. It is our vested interest that the European Union remains open and receptive, and contributes to the long-term security of Hungary through strengthening the stability and prosperity of our immediate and broad environment.
Hungary and its neighbours : Hungary is maintaining a balanced political, economic and cultural relationships with its neighbours, where the bonds are partly the common goals and interests of today and tomorrow, and partly the common experience – whose conclusions have not always been drawn - of the past as well. Hungary has seven neighbours among European countries. Some are already members of the EU, some countries will soon accede to it, and there are countries that have different expectations regarding accession. Hungary is committed to the development of democracy and market economy of its Southern and Eastern non-EU member neighbours, and supports – provided they meet the tough accession criteria – their Euroatlantic integration.
The regional cooperation in Central-Eastern Europe serves the expression of common regional interests within the European Union. Hungary is a founding member of the so-called ‘Visegrád Group’ together with Poland, Slovakia, the Czech Republic. It came into being in the historical town of Visegrád in the picturesque Danube Bend at the meeting of the presidents and prime ministers of the four countries in 1991. Hungary’s ties with Austria and Slovenia are exceptionally strong, and with these countries Hungary also cooperates in the framework of Regional Partnership.
As far as the neighbouring non-EU countries are concerned, the democratisation, economic stability and closing the gap with Europe are important objectives of Hungarian foreign policy. This is the vital security, economic and national-political interest of Hungary. We denounce extreme nationalism, ethnic hatred, which can cause the destabilisation of the countries concerned and their neighbourhood. Under the auspices of the Thessaloniki Programme of the EU Hungary also provides active and tangible assistance to neighbouring Serbia and to other states of the Western Balkans to achieve their integration objectives. We attach importance to the democratic and economic development of Ukraine – Hungary’s biggest neighbour, therefore we share our experience, besides Hungary stands for Ukraine’s European perspective.
Hungary supports its neighbours with own initiatives as well. In the framework of the so-called Nyíregyháza Initiative and the International Development Cooperation it has provided assistance to Ukraine, while through the Szeged Process similar assistance was given to Serbia.
Hungary and the United States, Canada : The United States has a distinctive place in the system of international relations. Hungary and the US maintain strong ties based on shared values and on the compatibility of interests. It is important for Hungary that along with global challenges our region remains in the focus of US foreign policy as a condition of stability. Our long-term goal is to encourage both US and Canadian companies to make further investments in Hungary, as we seek the promotion of cooperation in the field of science, and the expansion of social and human contacts as well. The large and successful Hungarian community living in North-America plays a vital role in this respect.
* * *
Far away from Europe : Europe is also aware of the fact that the world is undergoing transformation. Part of this transformation is the increasing importance of the Asia-Pacific Region in world economy and world politics. Hungary also pays ever greater attention to its relationships with the Asian and Pacific countries. The aim of the Hungarian Asia-policy is to develop and expand co-operation with those Asian and Pacific countries that are open to cooperation both politically and economically. We attribute special significance to the development of relationships with Japan and China based on the status of these two countries in international relations and world economy, and based on the volume of reciprocal trade flow and capital investments abroad. In the last decade our relationships with Australia has also strengthened. It is promising that Hungarians and the inhabitants of a lot of Asian and Pacific countries take an ever greater interest in the cultural values of each other.
Hungary, as a party to EU Common Foreign and Security Policy, has been a participant of the so-called ASEM (Asia-Europe Meeting) process from 2005. This process is an institutional dialogue between the EU and ASEAN dealing with the comprehensive issues, and economic, social, security political challenges of Asia.
Hungary and the Arab world : our countries, with strong historical, cultural relationships in the background, are extensively developing the economic relationships in line with mutual interest. The countries of the region – apart from supplying energy resources – are increasingly important markets for Hungarian products. New opportunities with the Gulf countries are opening up in the context of their modernisation efforts and in the field of cooperation in cutting edge technology. Our traditional relations with the Arabic countries of the South Mediterranean region - built up in the last decades - are expanding in new fields, such as tourism. Hungary is an active participant of the Barcelona Process, the Euro-Mediterranean dialogue - representing intercultural understanding - between the EU and the region.
The countries of Latin-America have gone a long way towards democratisation, market economy, and social development. The process of economic integration has started among the countries of the region. Hungary – in spite of the geographical distance - is doing its best to build stronger economic and trade relations, and to cooperate in completing new development projects. The local communities of Hungarians – formed by our compatriots who settled there several decades ago – provide great help in this process. The EU recognizes Latin-America as a strategic partner, which is expressed in regular interregional political dialogue – of which Hungary is an active participant.
In Africa the relationships that Hungary maintains with the states of the Sub-Saharan region are mainly of an economic nature. The reason for the expansion of relations can be justified by seizing the new opportunities in this field. As a party to the Cotonou Agreement, Hungary will participate in the institutional dialogue of the European Union with the African countries and with the African Union. Hungary is also contributing to international development assistance in Africa.
* * *
For a secure homeland – for a secure world
It is the intention of the Hungarian government to provide the highest level of security for the country’s citizens. We are all aware of the fact that in the world of globalisation the threats against security disregard national borders. Therefore, Hungary guarantees its security along with its allies through fostering the security of the international community.
Hungary is a member state of NATO and its security is ensured by this alliance . We regard NATO as the most important forum of the transatlantic security political dialogue and cooperation, and we fully support its adaptation to the new world-wide challenges, as well as its further enlargement, provided the candidate countries will embrace our shared values and meet the preparedness criteria.
Hungary stands by the strategic partnership between NATO and the EU. It plays a role in the implementation of the European Security and Defence Policy, and in the establishment of an Italian-Slovenian-Hungarian joint military unit to be set up by 2007.
New threats against Hungary and the whole mankind : The new kinds of dangers such as international terrorism, the proliferation of weapons of mass destruction, trans-border organized crime, and the coming into existence of dysfunctional states pose a threat to all countries of the world and to universal human and cultural values. The struggle against terrorism has become the principal common objective of the transatlantic co-operation. Hungary, as a member state of the UN, the EU and NATO, is committed to strengthening regional and global security. Hungarian soldiers and civilian peace-keepers are serving in several parts of the world under the auspices of the UN, NATO or the EU and in the military missions in Kosovo, Bosnia-Herzegovina, Afghanistan, and in Iraq. Thus Hungary is not only a beneficiary of security, but it also makes contributions to ensure security. Hungarians are also playing a role in making our world a more secure place along with soldiers of a lot of other nations.
Hungarian society has given proof of its solidarity, when it was quick to offer aid of several millions of dollars to relieve the consequences of disasters caused by the tsunami in South-East Asia at the end of 2004, hurricane Katrina and the floods in the Carpathian Basin in 2005.
Protecting and fostering democracy : the protection and representation of the democratic values that the European Union and the transatlantic co-operation are built on are long-term challenges that we have to respond to even beyond our borders and our neighbouring environment. Effective multilateralism, enhancing the role and cooperation of multilateral forums and enforcing international law are regarded by Hungarian foreign policy as the most appropriate instruments to cope with global challenges. The Centre of Democratic Transition was set up in Budapest in 2005 with the aim of sharing the experience gained by Hungary and other states during the change of the political system to states and organisations that ask for it.
The Hungarian economy
The Hungarian economy is linked to the world - to Europe - through foreign trade. The development of the Hungarian economy , which is considered exceptionally open even by international standards, is determined to a large extent by external conditions. Global growth and the swiftly expanding world trade provide favourable external conditions for the Hungarian economy. New reforms are underway to further increase the dynamism and competitiveness of Hungarian economy.
As a result of the steady growth of foreign trade flow since 1990 the range of goods available in the shops has significantly expanded, while the dismantling of foreign trade barriers has made it possible for Hungarian goods to be increasingly present on international markets. The volume of foreign trade tripled within one decade and its ratio to the GDP reached 150 % by the turn of the millennium, which marks the remarkable openness of the Hungarian economy even by international standards.
The most important economic partners of Hungary are the member states of the European Union, where nearly 80 % of the Hungarian export goes, and in the trade with them the Hungarian export surplus is significant. Our most important foreign trade partners are Germany, Austria, France, Italy and Great-Britain. The structure of the Hungarian exports can be characterised by the pre-dominance of the industrial goods, particularly that of the machine industry. The ratio of machines and transport vehicles exceeds 60 % of Hungarian exports, while processed goods make up a further 28 % of the total exports, mainly products of the pharmaceutical and chemical industry. The traditional Hungarian food export amounts to only 6 % of the total exports, while the ratio of energy resources and raw materials hardly add up to 5 %.
Becoming a member state of the EU also strengthened our international trade relations. Hungarian companies are also aided by the extensive international trade agreement system of the EU. Hungarian firms are striving to exploit the related advantages both on the markets within and outside the EU. In the last year Hungary’s exports to countries outside the EU increased at an unusually rapid pace. Hungary, therefore, considers the Asian, the Pacific, the Mediterranean, the Latin-American countries and the Gulf States to be long-term economic partners. In a restructuring world economy the companies in these countries offer increasing prospects for further co-operation.
Over the last fifteen years Hungary has become a popular target for foreign direct capital investments (FDI) . The country's central geographical location, and that it is situated at major international highways, the presence of a high number of well-trained workforce and transparent investment conditions, which are compliant with EU regulations, were the most important preconditions that have made it possible. In addition, favourable living conditions and the cultural values of Hungary are also appealing to foreigners. The appearance of multinational companies has greatly contributed to the modernisation of the Hungarian economy, the maintenance of its dynamic growth, and to preserving existing jobs and creating new jobs. The influx of FDI after 1995 has significantly accelerated, facilitating the steady growth of the Hungarian economy.
Since the change of the political system the volume of foreign direct capital investments in Hungary has reached 53 billion Euros by the end of 2005. The per capita active capital continues to be the highest in Hungary in the East-Central European region. The biggest part of foreign direct capital investments was made into the competitive processing industry (automotive industry, electric machinery production, chemical industry) and into the service industry.
The turn of the millennium saw the emergence of a new phenomenon in some of the Central and Eastern European countries: besides capital import, which remained the decisive kind of investment, capital export has also appeared. In this respect Hungary has a leading role in the region: Hungarian capital investment abroad has by now exceeded 6 billion dollars, concentrated mainly in the East- and South-East European region. Regarding the types of investments, Hungarian companies are participating primarily in the privatisation process of the service industry in our region.
* * *