Weekly newsletter

Pointing to the economic situation and world financial trends, the Hungarian government appears to have postponed the decision on the (re)purchase of Budapest Airport until after the elections, according to Prime Minister Viktor Orbán. The project has indeed come under criticism lately, and the economic situation has also forced the government to implement some lighter austerity measures in the form of postponing future developments.

At the press conference made after his meeting with French President Emmanuel Macron, the Hungarian Prime Minister said it was not reasonable to close the deal before the 2022 elections given the high rate of inflation and the volatility of the global financial markets. “So we’ll wait for the elections and decide on this afterwards,” he said.

This is certainly a turn in the case, since back in November the majority owners -German-based AviAlliance- reportedly entered into a due diligence process with the Hungarian government, just as the Orbán administration raised their offer once again, and proposed a hefty HUF 1.617 billion (EUR 4.4 billion) for the airfield.

The purchase is, however, becoming widely criticized. First, it was investigative portal G7 that revealed that the price would be enough to implement even a 17th-month pension, while a return is highly doubtful.

This latest announcement comes on the heels of the Central Bank head’s criticism. Pointing to bad timing, elevated price, world financial trends, and the capital’s overhead within Hungary, György Matolcsy strongly advised against the deal (and recommended the establishment of an alternative, central airport outside Budapest instead).

Central Bank Chief: Gov't Should Not Buy Back Budapest Airport
Central Bank Chief: Gov't Should Not Buy Back Budapest Airport

According to recent press reports, the government has recently raised offer once again, and proposed a hefty HUF 1.617 billion (EUR 4.4 billion) for the airfield.Continue reading

As for the economic situation, the Hungarian forint is at historic lows, while inflation is breaking records too, which just adds to an ever-growing budget deficit. As a result, the government recently announced to also postpone a total of HUF 350 billion (EUR 954 million) worth of development projects, which perhaps somewhat demonstrates that the Hungarian economy is not in the best shape at the moment.

featured image illustration via Zoltán Máthé/MTI