An increasing number of German companies are beginning to criticize the Hungarian government for attempting to take over their assets, says a new report by Bloomberg.
Until recently, German companies have treated Hungary as their own backyard in terms of trade and investment.
But growing numbers are now finding Prime Minister Viktor Orbán’s ‘Make Hungary Great Again’ strategy is a strain on their relations.
According to the Bloomberg report, “executives of companies from the retail trade, financial services, media, and telecommunications industries and the airport operator, they are under pressure from his nationalist aspirations to transfer assets to Hungary, especially those close to his management.”
Vice-chairman of the German Eastern Business Association in Berlin, Philipp Haussmann, whose company Klett Group invests in Hungary, lists punitive taxes, a rapidly changing legislative environment, regulatory pressure, as well as political campaigns against foreign entities, among the ways to push out foreign business.
Bloomberg cites Budapest airport as an example. Its partial owner and manager, AviAlliance, is being forced to sell for the second time, and the means of pressure is a series of reports about underinvestment in the airport, which the company denies.
An earlier buyout attempt, coordinated by Orbán's business partner and son-in-law in 2021, failed because potential buyers ran out of money.
Last month, the president of the Austrian company that owns the Spar grocery chain in Hungary, Hans Reisch, accused the authorities of using special taxes to force people close to Orbán's government to take over the company.
The government plans to take Spar to court over these accusations.
Despite this, Orbán's government has rejected accusations that it treats investors badly, with the Minister of Economy Mihály Varga insisting that Hungary's reputation among investors is "excellent."
According to him, four out of five German companies would choose Hungary as their investment destination again.
But growing numbers are now finding Prime Minister Viktor Orbán’s ‘Make Hungary Great Again’ strategy is a strain on their relations.
According to the Bloomberg report, “executives of companies from the retail trade, financial services, media, and telecommunications industries and the airport operator, they are under pressure from his nationalist aspirations to transfer assets to Hungary, especially those close to his management.”
Vice-chairman of the German Eastern Business Association in Berlin, Philipp Haussmann, whose company Klett Group invests in Hungary, lists punitive taxes, a rapidly changing legislative environment, regulatory pressure, as well as political campaigns against foreign entities, among the ways to push out foreign business.
Bloomberg cites Budapest airport as an example. Its partial owner and manager, AviAlliance, is being forced to sell for the second time, and the means of pressure is a series of reports about underinvestment in the airport, which the company denies.
An earlier buyout attempt, coordinated by Orbán's business partner and son-in-law in 2021, failed because potential buyers ran out of money.
Last month, the president of the Austrian company that owns the Spar grocery chain in Hungary, Hans Reisch, accused the authorities of using special taxes to force people close to Orbán's government to take over the company.
The government plans to take Spar to court over these accusations.
Despite this, Orbán's government has rejected accusations that it treats investors badly, with the Minister of Economy Mihály Varga insisting that Hungary's reputation among investors is "excellent."
According to him, four out of five German companies would choose Hungary as their investment destination again.
Source: PAP, Bloomberg
