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Heated Parliamentary Debate on Budapest-Belgrade Railway Mega-project

Ábrahám Vass 2020.04.09.

On Wednesday, the Budapest-Belgrade railway line was the main topic in the National Assembly. As the project is one of the most debated governmental investments, it brought tense debate and completely opposing points of views.

The refurbishment of the Budapest–Belgrade railway was decided by Orbán’s administration back in 2014. According to the plans, the 350 km high-speed rail line project would be a part of the planned Budapest–Belgrade–Skopje–Athens railway connection, a project of China’s ambitious and debated ‘Belt and Road’ initiative that would connect China-run Piraeus port in Greece with the “heart” of Europe. The 166 km-long Hungarian section would follow the Budapest–Kunszentmiklós-Tass-Kelebia line, thus avoiding densely populated and economically important cities such as Kecskemét and Szeged. 15% of the largest railway investment in Hungary’s history would be paid by the state, the remaining 85% would be lent by China.

Since the first announcement, the price went up many times, now estimated at HUF 600–1000 billion (EUR 1.7 – 2.7 billion), but given the nature of domestic large-scale investments, this amount may further increase. Classifying details of the project justified by saying that publicity of the arrangement could hurt Hungary’s foreign policy and foreign economic interests, China’s involvement, the high and ever-growing price, questioned viability and utility, Orbán, and Fidesz-ally businessmen involved in the project, have all become debated issues in domestic politics lately, and this was reflected during the debate as well. According to estimations, the project would need an unimaginable long time to return the investments.

Gov’t: Important for Hungary

Parliamentary State Secretary of the Ministry for Innovation and Technology (ITM) Tamás Schanda (of Christian Democrat KDNP), underlined that the development has extraordinary economic potential for Hungary in terms of Eurasian freight transport. Thanks to the investment, Hungary can become the number one logistics center in the region by offering the fastest route for goods from China to Western Europe. He also said that as part of the investment, the entire length of the Hungarian section will be modernized and double-tracked, with an engineered speed of 200 km per hour.

Tamás Schanda speaking. Image by Szilárd Koszticsák/MTI

The government’s representative also noted that the Budapest-Belgrade line is part of the European core railway network, so its modernization is also an obligation. He also said the government is simplifying procedures in order to increase efficiency, shorten deadlines, and reduce potential risks.

Opposition smells corruption and futility

Right-wing opposition Jobbik MP Dániel Z. Kárpát, called on the government to remove the investment from the agenda and to redirect funds to the fight against coronavirus. He said the Fidesz government is now preparing for its largest corruption investment, while thousands lose their jobs every day.

The party’s other MP, János Stummer, demanded answers about the reason for the classification. “The time has now come to sweep these buddies’ mega-business under the rug?” (The Hungarian part of the investment will be carried out by the holding of billionaire Lőrinc Mészáros, PM Orbán’s childhood friend and close ally).

Independent MP Bernadett Szél followed this line of thinking, and argued that the reason for the classification is because “…it is in secret when a lot can be stolen.” According to the former LMP leader, there are no economic, transport, or climate protection reasons for this “purely political project” by which “the Chinese Communist Party has bought up Fidesz and KDNP per kilo.”

According to centrist green LMP’s MP László Lóránt Keresztes, the government decided on classifying the project because there are no real standing arguments for its realization. He demanded a detailed budget to find out why  one kilometer of railway line would cost 5 billion forints (EUR 14.2 million). He also wanted to know the amount of shares Hungary would receive from the transport of goods from the east. He said, in his party’s view, this investment was contradictory to the national interest.

Who Will Rebuild Central Europe’s Railroads: China or the EU?

László Szakács of the Socialists (MSZP), objected that only [Orbán-ally billionaire] Lőrinc Mészáros could make an offer and that he would be the one “to spend money coming in from the Chinese loan. Hungarians will only have access to one thing from this project: the repayment of the loan.”

Meanwhile, liberal green Párbeszéd MP Bence Tordai questioned the project’s viability by stating that this section of railway line can be bypassed on water with only a little time loss, and if the aim was really to speed up rail transport, significant improvements would be needed in the Balkans as well. He said the investment is only in China’s, (who wants to invest its surplus capital), and Lőrinc Mészáros’ and his circle’s interests.

Gov’t: Chinese loan conditions favorable, classifying project needed

On the part of the governing alliance, Gábor Bányai (Fidesz) rebuffed the opposition’s claims that the investment would be a betrayal of the national interest. He argued that the project serves the future, and can lift up Hungarian transport and create benefits for all citizens. Regarding the cost, he argued that there is more than a two and a half times price difference between the construction of a railway line that allows a speed of 120 km/h or 160 km/h. On the close to doubled price, he said that prices had gone up in the past few years everywhere.

State secretary Tamás Schanda argued that the Chinese loan proved more favorable than the other ones on the market. While classifying the project details, he added, would only affect data containing sensitive Chinese business information, or would negatively affect Hungary’s foreign economic and foreign policy interests.

According to the state secretary, the fact that the novel coronavirus pandemic brings tough times for Hungary, the global economy is not an argument against building the railway line but an argument for it. He says it is more important than ever, as it would provide jobs for many Hungarians. He added that the current crisis is another reason to speed up the process instead of waiting. On the involvement of Lőrinc Mészáros’ company in the construction, Schanda said the bid had been open- everyone had had the possibility to compete, and Hungarians should be proud that a Hungarian company is in the winner consortium.

As of now, the project can kick-start in 2021, while the completion date is set to 2023.

featured image: MSZP MP László Szakács; by Szilárd Koszticsák/MTI