Hungary and China Sign New Agreements to Strengthen Economic and Cultural Cooperation During Xi Jinping's Visit

Hungary and China bolstered their economic and cultural ties with new agreements signed during Chinese President Xi Jinping's visit to Hungary. Xi and Hungarian Prime Minister Viktor Orbán discussed enhancing cooperation, underscoring the longstanding friendship between the nations.

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Xi Jinping

Hungary and China Sign New Agreements to Strengthen Economic and Cultural Cooperation During Xi Jinping's Visit

In a move to fortify China's economic footprint in Central Europe, Chinese President Xi Jinping embarked on a high-stakes visit to Hungary, solidifying economic and cultural cooperation between the two nations. The trip, which marked the final stop on Xi's five-day European tour, underscored Beijing's strategic interest in expanding its influence within the European Union (EU) bloc.

During talks in the Hungarian capital, Budapest, Xi and Prime Minister Viktor Orbán signed a number of agreements aimed at deepening the long-standing partnership between their countries. Orbán, known for his populist leanings and distancing from mainstream EU partners, lauded the "continuous, uninterrupted friendship" with China since his tenure began in 2010.

"I would like to assure the president that Hungary will continue to provide fair conditions for Chinese companies investing in our country, and that we will create the opportunity for the most modern Western and the most modern Eastern technologies to meet and build cooperation in Hungary," Orbán declared.

Beijing has invested billions in Hungary, viewing the EU member state as a strategic gateway to the lucrative European market. In a potentially game-changing development, Hungary recently announced that BYD, one of the world's largest electric vehicle (EV) manufacturers, will establish its first European EV production factory in the south of the country, potentially upending the continent's automotive industry competitiveness.

Why It Matters: Xi's visit to Hungary carries significant geopolitical implications, underscoring China's concerted efforts to expand its economic and political clout across Europe. As Beijing deepens its ties with Budapest, concerns arise regarding potential divisions within the EU and the erosion of the bloc's cohesion on critical issues such as human rights and trade practices. The growing Chinese influence in Central and Eastern Europe raises questions about the long-term consequences for the region's economic and political trajectories.

In addition to the EV sector, Hungary is hosting several Chinese battery plants and aims to become a global hub for lithium-ion battery manufacturing. The country has also undertaken a railway project – part of Xi's Belt and Road Initiative – to connect Hungary with the Chinese-controlled port of Piraeus in Greece, serving as an entry point for Chinese goods into Central and Eastern Europe.

During the press briefing, Xi stated that he and Orbán agreed the Belt and Road Initiative "is highly consistent with Hungary's strategy of opening to the east," adding that China supports Hungary in playing a greater role within the EU to promote China-EU relations.

While no major investments were announced during the visit, Hungarian Foreign Minister Péter Szijjártó later revealed that initial discussions had begun on China developing a freight railway bypass of Budapest and a rail link between the capital and Budapest Ferihegy airport.

Orbán, known for his nationalist populist rhetoric, acknowledged China's growing economic clout, stating, "Looking back at the world economy and commerce of 20 years ago, it doesn't resemble at all what we're living in today. Then, we lived in a single polar world, and now we live in a multi-polar world order, and one of the main columns of this new world order is China."

As Xi's visit unfolded, Budapest residents witnessed increased security measures, road closures, and demonstrations by both supporters and critics of the Chinese leader. Groups of Chinese nationals, claiming to be embassy volunteers, confronted opposition lawmakers attempting to display EU flags along Xi's motorcade route, triggering minor conflicts with Tibetan protesters and raising concerns about the erosion of free speech.

With China's growing economic and political influence in the region, Xi's visit to Hungary has solidified Beijing's ambitions and raised critical questions about the future dynamics within the EU and the delicate balance between economic cooperation and adherence to democratic principles.

Key Takeaways

  • Xi Jinping strengthens China-Hungary ties, marking end of European tour.
  • Agreements signed with Orbán to deepen economic cooperation.
  • China invests billions in Hungary, eyes gateway to European market.
  • BYD to establish first European EV factory in Hungary, reshaping auto industry.
  • Visit underscores China's push to expand influence in Europe.