Hungary in the 1990’s

By | December 27, 2021

In the Hungary the transition from the socialist regime to democracy took place without major shocks. At the beginning of the nineties, the first free elections had taken place which guaranteed a majority in Parliament to the center formations, but the governments that had been an expression of this, having failed with the planned economic reforms, were unable to maintain consensus. Thus, in 1994 the electorate rewarded the former communist party, which became the Hungarian Socialist Party (MSzP, Magyar Szocialista Párt). Also supported by the liberals of the Alliance of Free Democrats (SzDSz, Szabad Demokraták Szövetsége), the executive, headed by G. Horn, leader of the Socialist Party, could not, in turn, meet the expectations of a less austere policy capable of ensuring an increase in well-being. The rebalancing of the state financial structure, the stabilization of the currency, the restructuring and modernization of the economy, in fact, still presented themselves as the priority objectives, especially in view of rapid integration with the countries of Western Europe.

In March 1995, new austerity measures were enacted, which provoked protests in the country and demonstrations of dissent within the government: the heads of the ministries of Labor, Finance, Culture and Education submitted their resignations between October and November 1995. Horn rejected the resignation of L. Bokros, Minister of Finance, but had to accept it later, when he renewed it having been forced to present further restrictive economic measures. In the second half of 1996, new conflicts arose: a scandal in the management of the public company responsible for privatizations caused the competent minister, T. Suchman, to leave the government (October 1996); protests for the insufficiency of the foreseen funds were raised, in November, by the Minister of Social Policies; finally, in December 1996, the Minister for Agriculture was replaced, as the negotiations for entry into the European Union required a decisive restructuring of the sector. For Hungary 1999, please check

Political opposition intensified during 1997. In January, a motion of no confidence was presented to the executive, held responsible for the scandal of the public privatization company and, a few weeks later, a parliamentary commission found actual responsibility of members of the executive in the affair. A new investigation in March revealed that the secret services had conducted unauthorized investigations into members of the Socialist Party; but, after a few months, a commission charged with shedding light on the politicians’ past concluded that Horn had attended in 1956to paramilitary formations to consolidate the order re-established by Moscow. The resignation of the head of government was demanded from many quarters, but this was not presented. The attention of public opinion in fact concentrated on the accession of the Hungary to the Atlantic Alliance. In August 1997 the executive announced a referendum on the matter, which was held on November 16. The NATO membership was approved by ‘ 85, 3 % of the voters and the outcome of the consultation was ratified despite the low turnout (the 49 % of those eligible) and protests by peace groups: in July 1997, in fact,25 %.

In December 1997 the opposition organized: the Democratic Forum (MDF, Magyar Demokrata Fórum) made an electoral pact with the Federation of Young Democrats (FIDESz, Fiatal Demokrátak Szövetsége) and with the Hungarian Civic Party (MPP, Magyar Polgári Párt). Despite the undoubted results at the macroeconomic level achieved by the executive in office, the widespread dissatisfaction with the difficult living conditions (a consequence of years of rigor) led to an alternation of government. In the elections of May 24, 1998, the FIDESz-MPP alliance emerged as the first party in the National Assembly, with 148 seats out of 386. After the conclusion in June of a coalition agreement with the Independent Party of Small Owners (FKgP, Független Kisgazda párt), the new executive took office on 6 July 1998, led by V. Orban, leader of the FIDESz-MPP alliance. The first points of the program were identified in the fight against crime and in the objective of achieving an improvement in the standard of living. The economic planning document for the three-year period 2000 – 2002 envisaged the reduction of the deficit and the stabilization of the exchange rate with the euro as pillars of economic policy, overcoming an initial mistrust of international observers.

Full integration into the European Union was the main objective, common to the various Hungarian governments, having been the Hungary one of the first Eastern countries to request it (1994), but the negotiation phase remained unsurpassed and entry was scheduled for 2004. The final steps were also taken for joining NATO: in February 1999, after the favorable vote of the Parliament, President A. Göncz signed, in fact, the Washington Treaty. During the bombing of the NATO air forces against the Rep. Fed. Of Yugoslavia for the protection of the Albanian minority in Kosovo (March-June 1999), the US, neighboring country, gave the availability of its bases.

In the central-eastern area, good relations were established with Romania, at the end of long-term tensions, while relations with the Slovak Republic remained rather cold, after the substantial failure of a bilateral agreement signed in March 1995, which was to guarantee safeguarding the rights of the Hungarian minority in Slovakia. Friction between the two countries was also caused by the planned Gabčíkovo-Nagymaros hydroelectric plants on the Danube, despite the intervention of the International Court of Justice in September 1997.

Hungary in the 1990's