Hungarians keep watch on Ireland's vote on treaty

When diplomats and European Commission officials speculate on which candidate countries are likely to join the EU sooner than the rest, Hungary always figures prominently. A stroll around Budapest's vast new city centre shopping mall offers gaudy evidence of Hungary's growing prosperity.

The mall was thronged on Saturday afternoon, mainly with young people buying clothes, CDs and accessories such as fragrances or sunglasses. The brands on sale are, of course, the same as in western Europe and the prices are as high as anywhere else.

Hungary's GDP per person is just over half the EU average and the country is one of the most successful in the world at attracting foreign investment. In its negotiations for EU membership, Hungary is near the top of the league table and its leaders are confident they will be ready for membership within a couple of years.

At the foreign ministry headquarters overlooking the Danube, Mr Bela Szombati, senior official responsible for EU integration, is considering the impact on his country's negotiations if Ireland rejects the Nice Treaty. He is aware the referendum debate is complex and that those who vote No will not necessarily do so because they do not want the EU to enlarge.

"But in the end, it doesn't really matter from our point of view what the reasons are. What matters is the effect, and a rejection of the treaty could create an obstacle to enlargement," he said.

Opinion remains divided over whether enlargement could go ahead even if the Nice Treaty was not ratified. But Mr Szombati says Hungary is hoping all 15 EU member-states ratify the treaty as soon as possible.

"What is absolutely certain is that once the Nice Treaty is ratified, there is no legal obstacle to enlargement," he said.

Hungary's image as a model economy in central Europe has received a few knocks in recent months. Inflation, running above 10 per cent, is a worry, although the economy is sufficiently developed to ensure that the cost of labour is not the main attraction for investors. But as wages rise to keep pace with prices, some companies are moving to cheaper countries.

Among Hungary's biggest attractions for investors has been the political stability the country has enjoyed since the end of communism. But there are fears that, with one of Mr Viktor Orban's coalition partners on the verge of a split, the Prime Minister could be tempted to cuddle up to the far-right Hungarian Justice and Life Party.

The EU has warned Budapest that such a step could put its accession negotiations at risk.

Hungary's determination to join the EU is so great that Mr Orban will probably be persuaded against doing a deal with the far right. But a greater impediment to the country's early membership could be the slow progress in negotiations of its larger neighbour, Poland.

For some EU countries, notably Germany, a first wave of enlargement without Poland would be Hamlet without the prince. But Mr Szombati is adamant that Budapest should not have to wait just because Warsaw has bigger problems to solve before it can be accepted.

"The fundamental principle is that each country should be judged on an individual basis."