Hungary’s growing opposition has demanded an explanation from Prime Minister Viktor Orbán about the “aid package” allegedly offered by US President Donald Trump, writes Politico.
Orbán, a Trump ally, recently visited Washington and met with Trump at the White House. Upon his return to Budapest, he announced that the US had agreed to provide financial support to Hungary. The prime minister said that some of the tools Brussels could use against Hungary could now be considered ineffective, and the “financial strangulation” by the European Union could be forgotten.
After 15 years in power, Orbán faces a possible defeat next year, while the financial support from the US is reminiscent of Trump’s recent move to help an ideological ally in Argentina.
Orbán’s hints that EU funds due to Hungary have been frozen due to the rule of law in the country have raised questions for opposition leader Péter Magyar. He asked in a social media post why the US financial aid was needed: “What would Viktor Orbán spend the trillions of forints in American loans on? Why is he indebting his fellow citizens instead of bringing home the 8 trillion forints in EU funds owed to Hungarians?” In a separate post, Magyar asked why Orbán was secretly negotiating the aid package.
Hungarian media outlet Válasz Online reported that
Trump and Orbán are believed to have committed to a money transfer between the countries’ banks.
The US signed a similar 20 billion dollars deal with Argentina in October. If true, this would be the second time Trump has offered aid to a right-wing ally ahead of a crucial election. There are some differences that make the Washington-Budapest deal more difficult to understand. Hungary’s central bank does not have a dollar swap agreement with the United States, and Hungary has no formal agreement on a buffer. At the same time, the country has an agreement with the European Central Bank to swap the euro, and can turn to the International Monetary Fund if the ECB is unable or unwilling to help. Representatives of the White House and the US Treasury did not respond to requests for comment.
Hungary is in a much better financial position than Argentina, and it does not even really need financial assistance, so the whole issue is more theoretical at this point. Like many other EU countries, Hungary has shown weak growth rates, but the main threat to financial stability under Orbán is alienation from the bloc.
The U.S. aid to Argentina was a political success for Javier Milei, whose party won the mid-term elections on the 27th of October. This will allow Milei to move forward with radical economic changes in the country. Trump welcomed the outcome, noting that it required a lot of money from the United States. US Treasury Secretary Scott Bessett also indicated that American investments had yielded profits. However,
the Trump administration has not released details about the extent of US involvement.
Trump’s “rescue package” has drawn criticism from Democrats and even some Republicans, who have called the aid to Argentina a political buyout that could boost the growth of hedge funds while risking US taxpayer money by spending it on a country that is regularly bankrupting.
Bessett said the aid to Argentina is aimed at reducing China’s influence in Latin America and, more broadly, ensuring the preservation of American economic power in the Western Hemisphere.
There are parallels in Trump’s relations with Budapest and Buenos Aires, and efforts are being made to find reliable allies in regions where political leaders do not share the views of the US president.
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