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Date: Mon, 24 Apr 1995 20:55:15 +0100
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Subject: The Hungary Report No. 1.04
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  ==================
  The Hungary Report

  Direct from Budapest, every week

  No. 1.04 April 22, 1995

  ================================


  ======
  BRIEFS
  Copyright (c) 1995, Sarah Roe


  ============
  GENERAL NEWS

  Strike costs the nation dear

  Negotiations between MAV state railways workers and management this
  week proved useless as staff at Hungary's largest company began an
  open-ended nationwide strike at midnight on Wednesday. Inbound and
  outbound international train services have also been frozen.
  Disagreement is centered on the company's new collective agreement as
  MAV has refused to sign new collective contracts with employees. It
  is the seventh strike which has hit Hungary since 1990, but the first
  open-ended strike since 1904. On Friday there was little sign of
  progress, although MAV sources claim that as little as 25 per cent of
  employees are participating in the strike. Rail unions argue that
  this figure is inaccurate, stating that as many as 70 per cent were
  striking on Thursday. MAV officials estimate the strike will cost the
  Hungarian economy a daily Ft 700 million. Costs were already being
  racked up before Wednesday, when estimates put losses at Ft 15-20
  million per day since last Sunday. In addition, the country is
  threatened with further labor action in 'sympathy' with the rail
  workers. Airplane technicians staged a 20 minute strike on Friday
  morning, whilst unions representing teachers, Paks nuclear power
  plant workers, ironworkers, postmen and miners all back the rail
  strike.

  Media Law shuffles closer to statute books

  A draft version of Hungary's much-awaited media law was signed by
  coalition party representatives last week. Pal Vastagh, justice
  minister of the Socialist Party and Gabor Fodor, the Alliance of Free
  Democrats' minister of culture and education, put pen to paper on an
  issue which has been in discussion since the late eighties. But at
  this stage the significance of the draft is unclear, merely signaling
  agreement on a list of 18 points of mainly administrative decisions
  by the six coalition partners. It is still not finalized, for
  example, whether MTV2, Hungarian TV's second channel will be
  privatized, according to an article in this week's Budapest Business
  Journal. In November it was decided that MTV2 would be sold if a
  third national TV channel was not created within a year. But
  apparently this deadline was not mentioned in the draft. It now seems
  possible that MTV2 could be privatized, as the issue is "whether the
  Hungarian government can afford to operate two television channels",
  Free Democrat Peter Molnar told the Business Journal. Molnar was
  instrumental in drafting the media law.


  --------------------
  BUSINESS & ECONOMICS

  Privatization minister oversteps the mark

  A new privatization strategy will be announced shortly by
  Privatization Minister Tamas Suchman and Finance Minister Lajos
  Bokros. According to Hungary Around the Clock, he told Magyar Hirlap
  that the target figure of Ft 150 billion privatization revenue was
  "unrealizable" without the new strategy. Meanwhile an article in the
  Business Journal argued that unease is growing over the newly
  appointed Minister Suchman's role in privatization deals. Because of
  indecision within the State Holding Company, AV Rt, theoretically an
  autonomous agency, the Minister is the only one making decisions on
  privatization sales. Critics cite the sale of Hungary's largest
  advertising daily, Expressz, to a group of Canadian investors earlier
  this month. The deal was approved by Suchman alone, according to AV
  Rt board member Peter Mihalyi. He said that the minister had made
  political statements about the deal, and therefore it was thought
  better for him to have the final decision. Although privatization
  officials argue that the Expressz deal is not typical of future
  privatisations, it has put weight behind claims that a privatization
  minister will encourage political intervention in the privatization
  process. However, the creation of a new agency, which will consist of
  AV Rt and the State Property Agency will put an end to this,
  officials say.

  Austrian investors flock to Hungary

  A recent research survey by the Austrian Economic Research Institute
  states that Hungary is the favorite target for investors. Hungary
  Around the Clock cited national press which said that over 60 per
  cent of the ATS 24 billion invested in Eastern Europe has been poured
  into Hungary. The Czechs have received ATS 3.4 billion of Austrian
  investment, whilst Slovakia accumulated some ATS 2 billion. Austria
  is the third largest investor in Eastern Europe after Germany and the
  US.

  Joint venture factory opens

  Friday saw the opening of a new factory at Peremarton-based Nicolor
  Rt. The Japanese-Hungarian joint venture is owned by Dainichiseika
  (Japan) 55%, Nitrokemia (Hungary) 40%, and Kanematsu (Japan) 5%.
  Nitrokemia made an investment of $9 million to establish the new
  factory, which will produce pigment for sale to printing houses
  mainly in the US, Japan and Spain. In 1995, Nicolor expects to bring
  in $6 million in returns from prices.


  -----------
  SHORT TAKES

  President Arpad Goncz appears to be the only candidate for the post
  of president of the republic, for presidential elections to be held
  in July.

  The gypsy community, Hungary's largest ethnic minority, last week
  elected the Roma National Council, but Budapest Week reports that the
  overwhelming victory of the largest party, Lungo Drom has brought
  allegations of election fraud.

  A basic treaty was signed between Moldova and Hungary by President
  Mircea Snegur, the Moldovan president and Arpad Goncz, Hungarian
  president. The two leaders also stressed the development of economic
  and administrative ties.

  Coca-Cola will cut back 60 out of 100 staff at the Nagykanizsa plant
  in western Hungary because they will be terminating manufacturing at
  the site. A more modern plant in Gyor and a greenfield site in
  Dunaharaszti, which is currently under construction, will shoulder
  the extra load, Gabor Varga, company regional head, told Napi
  Gazdasag.

  ----------------
  NUMBERS CRUNCHED

  * February saw inflation grow by 4%, meaning that consumer goods cost
  around 27.5% more on average than in March. (Central Statistics
  Office, Hungary Around the Clock)

  * Proposed budget cuts will mean that expenditure will outweigh
  revenue by Ft 156 billion in 1995 rather than the original Ft 283
  billion. (Finance Ministry, Hungary Around the Clock)

  * Industrial production increased from December to January by 14.5
  per cent. (Central Statistics Office, Hungary Around the Clock).

  * The National Bank (MNB) will increase the amount of commercial
  banks' compulsory reserves in the MNB by 1% on May 1st, and a further
  1% on June 1st. (MNB, Hungary Around the Clock)


  -------------
  EXCHANGE RATE

  April 20, 1995 (National Bank of Hungary):

  US Dollar - 119.61 (buying), 121.7 (selling)
  Deutschemark - 87.28 (buying), 88.7 (selling)


  ==============
  WACKY AS USUAL

  Real action for Earth Day

  Earth Day, the internationally celebrated event to promote
  environmental awareness was acknowledged on Saturday through quizzes
  and games at the Budapest Zoo, a public awareness action on trash
  disposal problems, a bicycle parade and a 'Green Ball'. Meanwhile The
  Budapest Sun reported that air pollution has become worse in the
  capital, resulting in an education campaign by the city's
  authorities. A Ft 67 million advertising campaign, begun in March
  emphasizes the problem of traffic fumes in Budapest, urging people to
  use environmentally friendly public transport, in particular the
  electric-powered trams.


  =======
  FEATURE

  China yields secrets to the 1,000 year mystery of Hungary's origins

  By John Nadler
  Copyright (c) 1995

  Whether a blessing or a curse, Hungarians have always considered their
  1,000-year-old nation of 10.5 million inhabitants an island and an
  enigma.

  Nearly every central European ethnicity - Poles, Czechs,
  Austrians - boasts either Slavic or Germanic roots. With their closest
  relatives thought to be the faraway Finns and Estonians, the lonesome
  Hungarians have occupied an ethnic oasis ever since 895 AD when
  marauding Magyar horseman settled on this patch of the Carpathian
  basin now known as Hungary.

  Almost from that moment, Hungarians - or Magyars as they still call
  themselves - have posed the question: Who are we, and where did we
  come from?

  Today, a millenium later, Hungarian anthropologists believe they have
  found the answer in the most faraway of places: the Xinjiang province
  of north-west China. Since 1986, excavations of ancient graveyards
  and anthropological studies have yielded proof that this area,
  traditionally known as the 'Uigur' region, is the origin of the
  Hungarian people.

  "Every journey to Xinjiang is a revelation to me," said Istvan
  Kiszely, the anthropologist who led the first expedition nine years
  ago, and returns annually. "The first time we went, we excavated a
  graveyard and found exactly the same anthropological objects as were
  found in Hungary. They had the same traditions [as 9th and 10th
  century Hungarians] for burying their dead. No other people had these
  customs. Not the Uralic people. Not the Slavic people."

  1,200 graves were uncovered in Urumchi, the capital of Xinjiang. But
  according to Kiszely, the most persuasive proof of Hungary's kinship
  with the northern Chinese resides among the living.

  "In almost every sense these people are the same as Hungarians,"
  explained Kiszely. "In the biological sense, in blood graphs, even in
  their folk art."

  According to Kiszely's investigations, the traditional clothing,
  motifs, and music of the Xinjiang people is remarkably similar to the
  unique folk styles of the Hungarian peasantry. Other regional
  eccentricities of the Hungarians, ranging from their penchant for
  spices in food and a sweet wine called Tokaji, also links them with
  the ancient Uigurs.

  Kiszely claims that "inscriptions" found in the Gobi desert dating
  back to 800 BC can be interpreted using ancient Hungarian script. But
  the most moving words Kiszely found in China came during his first
  expedition when listening to an ancient folk ballad telling of an
  Uigur tribe that embarked on a journey west a thousand years ago.

  History tells us that the ancient Uigurs were wanderers. But almost
  exclusively in the east. In the 7th Century they erected the city of
  Karakorum, and they founded an empire in Mongolia that reigned
  between 744 and 840 AD. But according to the ballad Kiszely heard
  nine years ago, only one Uigur tribe ventured west, and the song
  promised its people would one day return.

  The locals reciting the poem were told of Kiszely's quest. "They
  received us as friends and relatives," Kiszely said. "This was a
  great moment for me."

  Kiszely's enthusiasm is not shared by all scholars. The findings in
  Xinjiang contradict the popularly held contention that the common
  ancestors of the Hungarians and the Finns originated in the Ural
  mountains, or beyond the Urals near the Ob River. Both the Finns and
  Hungarians belong to the Finno-Ugric language group, and both tongues
  share a few common words.

  According to Kiszely, the ancestors of the Hungarians and the Finns
  traded these words - 42 in total today - when they encountered each
  other near the Urals sometime after the Magyar tribes left north-west
  China in the 7th century. (The two peoples lived together 150 years,
  said Kiszely. Ample time to pick up portions of each other's
  vernacular.)

  Critics argue that academic theory linking Hungary's origins to the
  Urals was politically motivated. In the 19th century, the conquering
  Hapsburgs used it to downplay Hungary's eastern Turkish ties. A
  century later, the Soviets found it expedient to link Hungary's past
  to lands found within the USSR.

  But before the mid-19th century, Hungarians gazed in the direction of
  Asia when pondering their past. Declared Erzsebet Toth, coordinator
  of the Hungarian Tibet Society: "All the ancient legends and stories
  connect Hungarians with the peoples of the east."

  In 1819, famed Hungarian ethnographer Sandor Korosi Csoma ventured as
  far as Tibet to find the origins of the Magyars. He failed.

  And his failure is considered proof that Asian soil holds no secrets
  of Hungary's ancient past. According some scholars, Hungary's Asian
  traditions arise from its location at the east-west crossroads, and
  the plethora of peoples that have passed through here over the
  centuries. "It is hard to define: What is Hungarianism, who is a
  Hungarian," said Toth. "Here in Hungary dozens of nationalities have
  been mixed together... I don't think [Hungary's past] is
  reconstructable."

  According to Kiszely, Korosi Csoma himself disagreed. Hungary's
  revered Orientalist found no Magyar skeletons in the Himalayas in the
  early 19th Century.

  But Kiszely contends he didn't go quite far enough. "Before Korosi
  Csoma died in 1842, his last words were...to find the roots of the
  Hungarian people, go to the district of the Uigurs. [He] knew very
  well where to search."

  But by 1915, politics again foiled this quest. A Chinese annexation
  kept Hungarian anthropologists out of the Xinjiang province for 79
  years.

  Political thaw in Moscow and Beijing in the 1980s appears to have
  finally lifted the mist that had long hidden the 1,400-year-old horse
  tracks between Hungary and China. "It is amazing to me," Kiszely
  mused. "For 150 years [anthropology] served the government. Now I can
  allow myself to serve no one but the truth."


  ================
  PARLIAMENT WATCH
  By Tibor Vidos
  Copyright (c), 1995

  Hungarian President Arpad Goncz does not have to worry about a new job
  when his five year term expires this summer. Unless something really
  unexpected happens, his re-election for another and final five years
  seems just as certain as Mr. Torgyan (the leader of the Smallholders'
  Party (FKGP) making an unscheduled speech in Parliament before the
  agenda.

  President Goncz was elected to office by Parliament on August
  3, 1990 following an agreement between the then biggest Parliamentary
  party, the Hungarian Democratic Forum (MDF) and the largest
  opposition party, the Alliance of Free Democrats (SZDSZ). The essence
  of the deal was that SZDSZ supported the amendment of the
  constitution to limit the number of laws requiring a two third
  majority to be passed in return for a consensus on other basic
  constitutional issues and the election of Mr. Goncz - an SZDSZ leader
  -  to the post of President. In 1990 the governing conservative
  coalition did not command the two third majority required to modify
  the constitution or to pass other constitutional laws.

  Mr. Goncz was also the choice of Jozsef Antall - the leader of MDF and
  Prime Minister designate at the time of the MDF-SZDSZ agreement - as
  a result of their shared background in the Smallholders' Party. Both
  Mr. Antall and Mr. Goncz started their political careers in the
  Smallholders' Party in the mid forties and were among the leaders of
  the party's brief revival during the revolution in 1956. Relations
  between the two politicians became tense soon after the inauguration
  of Mr. Goncz and finally resulted in open confrontation when the
  President refused to sack the heads of public television and radio,
  who had been charged with political bias by the Prime Minister. The
  President also angered the Prime Minister by rapidly becoming the
  country's most popular politician.

  This time around both governing parties - the Hungarian Socialist
  Party (MSZP) and SZDSZ back Goncz's candidacy. Strangely, it is the
  Smallholders' Party that most vigorously objects to the re-election
  of the current President. FKGP activists collected over hundred and
  fifty thousand signatures in order to call a referendum on the direct
  or indirect election of the President. One might suspect that FKGP
  President Jozsef Torgyan only brought up the referendum to attract
  media attention onto himself. Mr. Torgyan - a skilled lawyer-  must
  certainly know that the Constitutional Court has ruled that no
  referendum can be held on constitutional matters. Well done, Mr.
  Torgyan.

  * * *

  Tibor Vidos is a lobbyist and political consultant in charge of the
  Budapest office of GJW Government Relations. A version of this
  article appeared in the Budapest Business Journal.


  ===========
  FINAL BLURB

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  Rick E. Bruner <bruner@ind.eunet.hu>
  John Nadler <jnadler@magnet.hu>
  Tibor Vidos <vidos@ind.eunet.hu>

  For its briefs, The Hungary Report regularly consults the news sources
  listed below -- for information about subsriptions, contact them by
  email: The Budapest Business Journal <100263.213@compuserve.com>;
  Budapest Sun <100275.456@compuserve.com>; Budapest Week and Hungary
  Around the Clock (same email address) <100324.141@compuserve.com>,
  and Central Europe Today (free online) <wordup@ftp.sztaki.hu>.

  ================
  END TRANSMISSION





