Hungary’s turn as EU president

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Hungary's EU presidency will focus on reclaiming some visibility for member states' presidencies after Belgium's turn – which saw the country move into the background to allow Herman Van Rompuy to lead as European Council president – and the contentious EU budget process for 2014-2020, writes global intelligence company STRATFOR in an analysis.

This analysis was authored by global intelligence company STRATFOR.

''On 1 January, Hungary took over the six-month rotating EU presidency from Belgium. Traditionally, the country that holds the presidency sets the bloc's agenda, mediates internal European disagreements and serves as the main negotiator with other powers during its term. At least that was the case before the appointment of former Belgian Prime Minister Herman Van Rompuy as the permanent European Council president, a position created with the implementation of the Lisbon Treaty in January 2010.

During Belgium's EU presidency, the country moved into the background, allowing its former prime minister to establish himself as more of an authoritative figure within the EU establishment. Since then, Van Rompuy has taken over intermediation between member states and has played a leading role in implementing German-imposed reforms to the EU economic rules.

Hungary, however, does not intend to continue the trend of diminishing the visibility of the member state holding the rotating presidency. This means the most important aspect of the Hungarian Presidency will be its attempt to reclaim the initiative for the EU member states.

Following the final EU summit hosted by the Belgian presidency, Hungarian Prime Minister Viktor Orban said that EU member states 'should not be afraid of being good patriots […] The idea that nationalism is a danger for Europe is an idea I cannot accept'.

Orban's point was that member states should not be sidelined by EU institutions that work for a few powerful states. This is a perspective shared by many of Hungary's Central European neighbours, as well as by smaller member states that do not consider themselves part of the European elite.

For Germany and France, Van Rompuy's role is convenient because it grants them unfettered access to the permanent European Council president (and with that access, the ability to apply pressure). But member states like Hungary view Van Rompuy's role with suspicion, an attempt by Berlin and Paris to streamline the decision-making process, which inevitably means sidelining states like Hungary.

The Wish List

Every member state that holds the EU presidency brings with it a list of issues it wants to address during its six months at the helm. Many of these are issues of regional interest or specific national interest, and many receive no attention due to various events and crises that the country ends up having to deal with during its presidency.

Hungary's wish list includes several items intended to return Budapest to a leadership role in Central and Eastern Europe. Hungary's governing centre-right Fidesz party believes Hungary lost that position during a decade of what it sees as political and economic mismanagement at the hands of its political rivals.

Budapest has therefore outlined initiatives for hosting an Eastern Partnership heads of state summit in May, pushing Croatia’s EU accession forward, expanding the EU Schengen zone to include Bulgaria and Romania, enhancing economic and environmental coordination of the Danube region, starting the Serbia-Kosovo negotiations process, and implementing an EU-wide Roma integration strategy.

While the optimistic list will give Hungary and its confident new government (Fidesz is one of the few governments in recent European memory to have two-thirds of the seats in its country's parliament) the visibility it craves on the European stage, it is not clear whether these goals will be met.

The Danube Strategy has no financial support, France and Germany oppose Romania and Bulgaria's Schengen entry, the Eastern Partnership is a Polish-Swedish initiative of which Hungary recently became a part, and Croatian accession ultimately depends on the effort Croatia puts into concluding the remaining (and thorny) negotiating chapters with the European Union, rather than any decision to be made by Budapest.

The 'Huge Fight'

Beyond the expansive wish list, Budapest's presidency can ultimately be boiled down to a single item: the 2014-2020 EU budgetary period. The European Union sets its budgets in six-year intervals, with minimal modifications to the annual budgets possible once the numbers for the interval are set.

The United Kingdom wants to see the budget reduced to reflect its own deep budget cuts at home. France and Germany are largely in agreement with London, particularly because they do not want to see the new member states in Central Europe receive an increase in funding. Europe therefore can expect three very contentious years of negotiations on the new budget.

For Hungary – and Poland, which will take over the rotating EU presidency after Hungary – this is a key issue for 2011 and beyond. With two Central European member states in charge in successive terms for the first time, Budapest and Warsaw hope to set the stage for the budget negotiations.

Hungarian Foreign Minister Janos Martonyi has already said that 'a huge fight' was brewing within the Union over the issue, with wealthier old member states on one end and poorer new member states on the other.

However, in order for Hungary to create an effective change in policy on the matter in the next six months, it will need to create a broader coalition than just its fellow new member states. The coalition Hungary and Poland will be able to gather comprises only 20% of the EU population, and the idea of increasing the budget runs counter to the interests of more than 50% — represented by Germany, France, the United Kingdom and other fiscally conservative member states, such as the Netherlands and the Nordic states. The chances of success, therefore, are low.''

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