Landslide victory for centre-right in Hungary

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HUNGARY’S centre-right Fidesz party celebrated a historic election victory yesterday and pledged to drive a hard bargain in talks to renegotiate an international loan that saved the economy from collapse.

In Sunday’s second round of voting, Fidesz became the first party since communism collapsed in 1989 to secure more than two-thirds of seats in Hungary’s parliament, a mandate that allows it to change the constitution and major laws without having to make deals with other parties.

Fidesz leader and prime minister-designate Viktor Orban (46) called his victory a peaceful “revolution”, with which Hungarians had “ousted the regime of oligarchs who misused their power, and the people have established a new regime, the regime of national unity”.

Fidesz won 263 seats in parliament, far ahead of the 59 seats secured by the Socialists, who are in disarray after eight years in power. The ultra-nationalist Jobbik party entered parliament for the first time with 47 seats and the new liberal and green party, Politics Can Be Different, won 16 seats at its first attempt. One independent MP also won a seat.

The Socialists were laid low by a series of scandals, the economic crisis that struck Hungary in 2008, and the unpopular cutbacks demanded by European Union and International Monetary Fund in return for a €20 billion emergency loan that averted financial meltdown.

Mr Orban says he wants lower taxes to stimulate growth and will try to persuade the EU and IMF to allow Hungary a higher budget deficit in return for a comprehensive plan on reducing its debt.

“Our job is that Hungarians have an economic plan for which we can win the support of those who otherwise have undertaken Hungary’s financing. We are seeking a partnership . . . We must draw up a multi-year plan in which we cut Hungarian state debt to a manageable level,” Mr Orban said.

He added that he hoped to reach a new agreement with creditors this year but stressed that “we will not accept diktats but present our own views and then try to win over market financiers, financial bodies of the EU and the World Bank and representatives of the IMF”.

“In my view, neither the IMF nor the EU’s financial bodies are our bosses. We are not subordinate to them,” Mr Orban added.

The Fidesz leader has pledged to cut bureaucracy and corruption and make the economy more efficient, but analysts say international markets are wary of his reputation for profligacy and unfulfilled promises earned during his time as premier from 1998-2002.

“If implemented, changes like the reform of the municipal system or a profound tax and labour market reform would shift the nature of the fiscal adjustment from expenditure freezes . . . towards structural changes that would support long-term fiscal sustainability,” said investment bank Goldman Sachs.

“A failure to implement the promised reforms would quickly erode the confidence in the new government and the course of the economic policy.”


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