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Hungary PM to meet Putin in trade and economy push

January 13, 2014, 20:46 UTC+3 MOSCOW
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MOSCOW, January 13. /ITAR-TASS/. Hungarian Prime Minister Viktor Orban visits Moscow on January 14, invited for talks with Russian head of state Vladimir Putin, a presidential spokesman said on Monday.

“Putin and Orban will discuss the current state of and prospects for the development of bilateral relations alongside possible measures to expand mutually beneficial trade and economic co-operation between the two countries,” the official said, adding that trade and economic relations of the two countries had great potential.

Russia is Hungary’s main trading partner outside the European Union, being third after Germany and Austria. In January-October 2013 mutual trade totalled $7.2 billion (in the whole of 2012, $9.7 billion).

The countries are also biggest investment partners, with Russia’s total exposure to the Hungarian market at $1.5 billion and Hungary’s investments in the Russian economy worth nearly $2 billion. Major Hungarian investors include the OTP Bank (with its equity capital worth 24 billion roubles and active assets worth 147 billion roubles), the pharmaceutical company Gedeon Richter (a pharmaceutical plant in the Moscow region) alongside the oil and gas company MOL Group (oil production in the Tomsk region in Russia’s Siberian federal district). Russian investors in Hungary are represented by Russia’s largest private oil firm LUKOIL (a network of 75 filling stations and an oil storage facility) and the largest state-controlled bank Sberbank, which acquired assets from Austria’s Volksbank in 2012.

The basis of Russian-Hungarian economic relations today is formed by the traditional energy industry, which makes up the lion's share of mutual trade. Russia accounts for about 80 percent of oil supplied in Hungary and 75 percent of natural gas. Almost 40 percent of electric power used in Hungary is produced with the assistance of Russian specialists from the Paks Nuclear Power Plant. The countries also consider the possibility of further co-operation to significantly increase the plant’s capacity. Besides, Hungary actively participates in the implementation of the South Stream project aimed to transport Russian natural gas through the Black Sea to Bulgaria and further to Greece, Italy and Austria. A 229-kilometre long pipeline section will run through Hungary. According to the schedule, construction work is to start in March 2015, while the transport of gas will start in January 2017, at the latest. A corresponding intergovernmental agreement between Russia and Hungary was signed on February 28, 2008.

The two countries keep regular contacts at high levels. There is a successfully operating Hungarian-Russian Intergovernmental Commission for Economic Cooperation (IGC), whose framework is suitable to solve any controversies that may arise in bilateral economic relations. Its latest meeting was held in September 2013 in Budapest.

Russia and Hungary also traditionally develop their cultural and academic ties. There are regular cultural exchanges. An important role in the development of bilateral relations belongs to the Tolstoy Association for Hungarian-Russian Co-operation, founded in 2011, which is actively and successfully working together with the Russian NGO called For Friendly Relations with Hungary in the promotion of the achievements of Russian culture.

There is generally a growing interest in the Russian culture and the Russian language in Hungary. Language courses launched by the Russian Cultural Centre enjoy great popularity. The number of those who are learning the Russian language at Hungarian universities and institutions has also significantly increased, making it the fourth most popular language after English, German and French. In April 2013, the Russian Culture Ministry and the Hungarian Ministry of Social Development signed a Co-operation Programme for 2013-2015. The parties also resumed the Protocol on exchanges in education.

Orban became Hungary’s prime minister in the spring of 2010. Since then, Russia and Hungary have maintained an active political dialogue. In November of 2013, Orban met Russia’s president in Moscow and returned for a working visit in January 2013, telling the president his country hoped for Russian support to upgrade his nation's power supply system.

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