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Ukrainian Pipeline Transit Fee Worsens Inflation, Says Minister Gulyás

MTI-Hungary Today 2023.09.14.

On Wednesday, Government Spokeswoman Alexandra Szentkirályi and Gergely Gulyás, the Minister heading the Prime Minister’s Office, held a Government Info briefing. The topics discussed included inflation, the transit fee for the Ukrainian pipeline, family benefits, and Ukrainian grain.

Inflation, Transit Fee, and Fuel Prices

The government has pledged to bring inflation down to single digits this year, a target that remains realistic despite all the difficulties, the minister affirmed. He pointed out that the current forecasts for November and December show that the government can certainly meet its inflation commitment. However, there are also worrying signs, mainly linked to the fact that fuel prices are higher than they have been, he explained.

Gergely Gulyás stressed that the primary reason for this is that

they are forced to import fuel through Ukrainian pipelines at five times the price, and that this transit fare increase goes against all recommendations, “while we are subsidizing Ukraine in a number of areas.”

The minister noted that the change in fuel prices alone in the last month has so far increased inflation by half a percent. He stressed that it was not considered fair business practice to increase the transit fees by three to five times. Thus, the government is looking for alternative ways to buy fuel.

Ukrainian grain

Gulyás said that the period during which the European Commission (EC) allowed a ban on the import of Ukrainian grain into the five neighboring countries will expire on September 15. If the EC does not extend it, “we will be forced to introduce such measures at national level,” he emphasized.

From here we are also asking the European Commission to see the rationality of this decision and to extend the current import ban.”

It would be better if a solution could indeed be found that would meet the original objective, which was that Ukrainian grain should not destroy European agricultural markets, but should primarily help starving African countries, he said. Moreover, there is a also serious debate on whether Ukrainian grain meets European quality criteria.

Agriculture Minister: Ban on Ukrainian Cereals Imports Must Be Maintained
Agriculture Minister: Ban on Ukrainian Cereals Imports Must Be Maintained

If the EU does not act, Hungary will extend the ban on Ukrainian grain imports after September 15 under national competence.Continue reading

Demographic Summit

Speaking ahead of the 5th Budapest Demographic Summit, held on Thursday and Friday, the minister said that Hungary had made significant progress in this area over the past decade, but “we are not where we want to be.”

He remarked that

in 2010, when the government introduced a new demographic policy, the fertility rate was 1.23, rising to 1.59 by the end of 2021.

This represents an increase of 25.6 percent, making Hungary the country with the highest total fertility rate in the European Union in the last decade, he added, noting that if the previous trend had not changed, 160,000 children would not have been born between 2011 and 2021. At the same time, there are difficulties, such as the fact that the number of women of childbearing age is decreasing.

Gulyás announced that the government will introduce new family policy measures next year, serving both access to housing and the country’s demographic goals.

Sweden’s Accession to NATO

Gulyás called the educational film made in Sweden, according to which the state of democracy in Hungary has been steadily deteriorating since 2010, an accusation without any basis and an unjustified insult. He emphasized that

if the film is played in state schools, it means that Sweden is doing everything to prevent Hungary from ratifying its accession to NATO.

He added that he would suggest to the Fidesz group leader that their MPs should debate again whether they want this country to join NATO.

Turkey's Interests Taken into Account Concerning Sweden's NATO Accession
Turkey's Interests Taken into Account Concerning Sweden's NATO Accession

Foreign Minister Péter Szijjártó said in an interview that parliament will vote on the issue at the autumn plenary session.Continue reading

European Union Affairs

Gulyás noted that the government hoped that the European Commission would back down on the legality of the case, so that there would be no obstacles to the country receiving EU funds. He added that the country had fulfilled the conditions, no further steps were needed, and the Commission had until November to decide.

On the arrival of EU funds in Hungary, he said it would be easier to get the money from the seven-year budget, but we want to get all the money and the government is negotiating all the cases in Brussels accordingly.

The minister was also asked about the migrant situation and whether Hungary would receive a contribution to the construction of the border fence. He pointed out that compared to the 2015 ‘willkommenskultur,’ the need for border protection is now also visible in the EU, however, at the same time, what the EU as a whole stands for makes it impossible to protect external borders. The minister expressed hope that the European Union would at least partially reimburse the costs incurred by the countries concerned in protecting their external borders on the basis of their Schengen obligations.

Purchasing Budapest Airport

On the negotiations on purchasing the Budapest Airport, Gulyás said they were going well, but until an agreement was reached he did not wish to disclose details. If this happens, they will make public all the details and the good news. “We are close to making such good news public,” he noted.

To compare the amount planned to be spent on the purchase of the airport with the amount needed to raise teachers’ salaries is unjustified, he said in response to a question. He added that buying the airport could increase the public debt, not the budget deficit.

Government Makes Offer to Buy Budapest Airport
Government Makes Offer to Buy Budapest Airport

According to the international news agency, Bloomberg, the buyer is a state-controlled investment company.Continue reading

Via MTI, Featured photo via MTI/Balogh Zoltán

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