Hungarian Prime Minister Viktor Orbán recently landed in Beijing for a meeting with Chinese President Xi Jinping. Orbán playfully dubbed this visit Peace Mission 3.0, a nod to his recent talks with Ukrainian and Russian leaders. This latest journey underscores Hungary’s unique and often controversial stance in European politics. The roots of Hungary-China relations stretch back to October 1949, when Hungary became one of the first countries to recognize the newly formed People’s Republic of China. Over the decades, this relationship has evolved, marked by significant milestones such as Hungary becoming the first European country to join China’s Belt and Road Initiative (BRI) in 2015. This long-standing connection has laid the groundwork for the current intensification of bilateral ties under Orbán’s leadership.
The economic dimension of Hungary-China relations has seen remarkable growth in recent years. Bilateral trade reached $14.52 billion in 2023, representing a 73% increase since 2013. China has become Hungary’s largest trade partner outside the EU, while Hungary stands as China’s third-largest trade partner in Central and Eastern Europe. Chinese investments in Hungary have also surged, reaching $8.12 billion in 2023 and accounting for 58% of Hungary’s total foreign direct investment.
Key sectors of cooperation include high-value-added machinery, electrical equipment, and advanced technology products. The automotive industry has been a particular focus, with Chinese companies like CATL and BYD establishing significant production bases in Hungary. These investments align with Hungary’s ambition to become a key node in the European automotive industry and supply chain.
One of the most visible symbols of Hungary-China cooperation is the ongoing construction of a high-speed railway connecting Budapest to Belgrade, largely financed by China. This project, part of the BRI, represents China’s ambition to create new trade routes into Europe and Hungary’s desire to position itself as a crucial link in this network.
Orbán’s Eastern Opening strategy, which seeks to diversify Hungary’s economic partnerships beyond the EU, has yielded tangible benefits but also created tensions with Hungary’s EU partners. The timing of Orbán’s recent visit to Beijing, just days before a crucial NATO summit and amidst growing EU-China tensions over electric vehicle tariffs, underscores these complexities. Hungary’s willingness to engage closely with China, despite EU reservations, has raised concerns about potential divisions within the bloc. German Vice Chancellor Robert Habeck’s statement that Orbán does not speak for Europe highlights the growing rift between Hungary and some of its EU partners on issues related to China.
Orbán’s approach to China reflects a pragmatic economic strategy aimed at attracting investment and boosting trade. The significant increase in bilateral trade and Chinese investment in Hungary demonstrates the short-term economic benefits of this policy. However, this economic pragmatism comes at the cost of potential political isolation within the EU. As the bloc seeks to develop a more cohesive and assertive policy towards China, Hungary’s close ties with Beijing could become a point of contention.
Hungary’s relationship with China provides Orbán with leverage in EU politics. By positioning Hungary as a bridge between East and West, Orbán can potentially extract concessions from both sides. This strategy allows Hungary to punch above its weight in international affairs, but it also risks alienating traditional allies within the EU.
Hungary’s deepening ties with China pose a challenge to EU unity, particularly in formulating a common foreign policy towards Beijing. As the EU seeks to address issues such as trade imbalances, human rights concerns, and technology transfers with China, Hungary’s divergent approach could complicate these efforts. This situation highlights the ongoing tension between national interests and collective EU policy.
From China’s perspective, close ties with Hungary offer a valuable foothold in Europe. By cultivating strong bilateral relationships with individual EU member states, China can potentially influence EU decision-making from within. Hungary’s openness to Chinese investment and diplomatic overtures provides Beijing with an important ally in an increasingly complex European landscape. Hungary’s China policy has implications for regional dynamics within Central and Eastern Europe. As other countries in the region observe the economic benefits of Hungary’s approach, they may be tempted to pursue similar strategies. This could lead to increased competition for Chinese investment and potentially complicate regional cooperation within frameworks like the Visegrád Group.
While Hungary’s China strategy has yielded short-term economic gains, its long-term sustainability remains uncertain. Overdependence on Chinese investment could leave Hungary vulnerable to economic and political pressure from Beijing. Moreover, as the EU develops more robust mechanisms to screen foreign investments, particularly in strategic sectors, Hungary may find its ability to attract Chinese capital constrained.
Although Orbán has consistently affirmed Hungary’s commitment to EU membership, his government’s policies, including its China strategy, have strained relations with Brussels. The question arises whether Hungary can maintain its current course without fundamentally altering its position within the EU. The ongoing debate over rule of law and democratic backsliding in Hungary adds another layer of complexity to this issue.
Orbán’s approach reflects a broader trend of smaller nations attempting to navigate an increasingly multipolar world. By maintaining strong ties with both the EU and China, Hungary seeks to maximize its strategic options. However, this balancing act becomes more challenging as tensions between the West and China intensify.
In the near future several scenarios could unfold. Hungary may continue its current strategy, carefully balancing between EU commitments and Chinese partnerships. This would require skillful diplomacy to manage tensions with EU partners. Alternatively, increased pressure from the EU could force Hungary to recalibrate its China policy, potentially leading to a cooling of Hungary-China relations. A third possibility is that Hungary could deepen its ties with China, possibly at the cost of further straining relations with the EU. Finally, a scenario where EU-China relations improve could vindicate Hungary’s approach and strengthen its position within the EU.
Viktor Orbán’s Eastern Opening strategy and Hungary’s deepening ties with China represent a significant development in European politics. While yielding economic benefits for Hungary, this approach raises important questions about EU unity, the bloc’s China policy, and the future of Hungary’s EU membership. As global geopolitical tensions rise, Hungary’s balancing act between East and West will likely face increasing challenges. The success or failure of Orbán’s China gambit will have implications not just for Hungary, but for the broader dynamics of EU-China relations and the ability of smaller nations to chart an independent course in an increasingly polarized world.
