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Is China Using Hungary as Its Bridgehead in Europe?

by Keegan Ross
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The primary purpose of Xi Jinping’s three-day visit to Hungary might be to ensure that Hungary can help China gain market share in the EU, as Beijing and Budapest prepare to sign a total of 16 bilateral agreements.

The Chinese president has arrived in Budapest late Wednesday, in the third and last stop of his European visit.

During his three-day stay, Xi Jinping and his delegation are expected to conclude a series of economic agreements with Budapest, as China sees Hungary as an important bridgehead in conquering European markets: among other things, Chinese companies are building electric car and battery factories.

The two sides are expected to sign 16 agreements, while another two are still being negotiated. The deals include Hungarian infrastructural developments and railway, road and energy projects related to Beijing’s top-priority Belt and Road Initiative. 

Renovation work is underway on the Budapest-Belgrade railway line, one of the symbols of China’s economic expansion in Hungary: 85% of the investment is covered by Chinese loans. 

With Hungary and Serbia’s cooperation, the modernised railway meant to be a part of the planned Budapest–Belgrade–Skopje–Athens railway would help Chinese goods reach Western Europe from the Greek China-run port of Piraeus faster than ever.

The railway has been sharply criticised since its inception. Earlier in 2023, questions were raised about whether the imported technology needed to operate it complies with EU standards. 

Other critics have pointed out it bypasses all major Hungarian cities; the Chinese credit for its construction might take an entire century to pay back in full, while the investment return is under question. 

It’s (almost) all about the money

Personal interests also play a role in the huge investments, international relations and Hungarian politics expert Csaba Káncz told Euronews.

“In the case of Hungary, we are talking about the most corrupt member state of the EU. Just like with Russia, the Hungarian regime has entered into some sort of a ‘strategic corruption’ framework agreement [with China]. With Russians, we know that this is … overpriced gas,” Káncz said.

“With the Chinese, it’s the Budapest-Belgrade railway line, from which the regime … can take out several billion euros a year.”

AP

According to Káncz, it’s not just about pure investment, and Xi is also visiting Europe as a security policy ally.

“Hungary has already become an official member of the so-called ‘peace camp’, the same peace camp from the 1950s [during the Cold War]. We are talking about revisionist, pro-war powers, Russia, China, Iran,” he said.

“In practice, China has now become the ‘alpha male’ of the Eurasian axis. It is the dominant power, it has the money and technology and here it is on a visit to its new colony,” Káncz concluded.

Meanwhile, EU officials have already stated they are looking to limit China’s economic aspirations in Europe. 

The European Commission has launched an investigation into Chinese state subsidies for manufacturing electric vehicles and solar panels, accusing the Beijing leadership of distorting market competition.

Source: Euro News

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