Menu
In his writing published in the London business daily, the Prime Minister stresses that Hungary has assumed the rotating presidency of the Council of the European Union for a second time, 13 years after its first.
He highlights that during his time as prime minister – a role he held between the two presidencies – he has had a unique vantage point from which to witness the erosion of Europe’s competitiveness.
I have been fortunate enough to know the great architects of the European integration of the 1990s. Among them was Helmut Kohl, who often observed that Europe’s political survival hinges on maintaining economic competitiveness,
Mr Orbán writes.
The Prime Minister quotes the late German Chancellor who once remarked: “We all need Europe in order to remain competitive on the world markets.” According to Mr Orbán, his words have never been as relevant as they are today.
The Prime Minister adds that the loss of the EU’s competitiveness has been a growing tendency in recent decades. This decline can be attributed primarily to misguided Brussels decisions that go against the realities of the world economy,” Mr Orbán writes.
The Prime Minister refers to the green transition as a chief example in which the EU has been imposing its own ideologically motivated goals without adequately consulting industry. With energy prices now three to five times higher than those in the US, European companies are losing their competitive edge and are being compelled to allocate funds to utility bills rather than innovation, Mr Orbán states in his article.
The Prime Minister believes it is obvious that Europe must aim for leadership in the green industry, with particular emphasis on electric vehicle development and manufacturing. However, imposing regulations that hinder industrial stakeholders and burden citizens is no longer sustainable.
Farmers are also facing significant challenges: their production costs have risen significantly, and they are having to navigate increasingly complex “green obligations,” the Prime Minister writes.
He stresses that businesses are also facing increasingly heavy tax burdens. The introduction of the Organisation for Economic Co-operation and Development’s (OECD) global minimum corporate tax in January, intended as the EU’s largest tax reform, has been a catastrophic failure. In spite of the fact that around 140 countries, including all EU member states, have joined the agreement, key competitors such as the United States, China and India have yet to adopt it, the Prime Minister stresses.
According to Mr Orbán, Europe has become a far less attractive investment destination, even prompting European companies to consider relocating to other markets.
The Prime Minister observes that while economic growth in major EU countries will barely reach 1 per cent this year, the US is set to grow by nearly 3 per cent, China by close to 5 per cent, and India by almost 7 per cent. “Over time we will only fall further behind. An immediate course correction is necessary,” Mr Orbán’s article reads.
The Prime Minister adds that Hungarian experience shows that economic success requires competition and a business-friendly environment. The Hungarian government implemented a flat personal income tax, abolished the inheritance tax for close relations and maintains the lowest corporate tax rate among EU countries. “We have also diversified our trade and investment relationships, focusing on co-operation with industrial partners in the Asia-Pacific region in key sectors of technology and innovation. Consequently, last year resulted in a record high FDI influx into Hungary,” Mr Orbán writes in the Financial Times.
He adds that Hungary aims to convince its fellow Europeans that healthy competition, as well as co-operation with the best technologies, will lead to more growth, and for this he proposes in particular a new green industrial strategy in collaboration with major industrial stakeholders.
We aim to negotiate a new competitiveness deal to relaunch European economic expansion, while promoting an open economy and international co-operation,
the Prime Minister writes.
He stresses that Hungary wants to curb illegal migration by working closely with the primary countries of origin and transit, emphasising the importance of protecting external borders and the necessity of EU funding for this purpose.
It is no secret that Hungary’s competitiveness strategy has drawn inspiration from the German-French growth and competitiveness agenda. Consequently, it is unsurprising that Berlin and Paris, along with Rome, have endorsed the Hungarian presidency’s initiatives. “We firmly believe that a competitive Europe serves the interests of all member states. Hungary is gearing up for an exceptionally active EU presidency. It’s time to set aside ideological disputes and kick-start Europe’s engine. Let’s make Europe competitive again,” Mr Orbán writes in conclusion.
