Hungarian referendum on nuclear deal with Russia rejected

By bne IntelliNews March 23, 2017

The expansion of the Paks nuclear power plant will be Hungary's “biggest political error of the 21st century” claimed Bernadett Szel, leader of the small opposition party LMP, on March 22, as she criticised a National Election Committee (NVB) decision to block efforts to hold a referendum.

The inter-governmental deal will see Russia add two new units to Hungary's only nuclear power plant, lending Budapest €10bn towards the €12.5bn project costs into the bargain. The deal was given approval by the EU early this month. Brussels insists much of the power produced must be sold on the open market, however, where prices are far below production costs for a new nuclear plant.

The NVB argued that the five referendum questions submitted by the LMP conflict with “Hungary’s obligations under international agreements,” and were not “clearly worded”. Hungarian law rules out referenda on issues covered by international agreements.

However, the committee’s government-appointed leaders have a history of favouring the ruling party in decision making. Last year the NVB authorized a government sponsored vote on the EU's migrant quotas.

Two high profile opposition referenda applications have made it past the NVB recently - against the Sunday shopping ban and the bid for Budapest to host the Olympics. In both cases, the government chose to back down rather than face defeat in a vote.

The LMP announced a plan for a referendum on Paks 2 in the wake of the collapse of the Olympics bid. In the meantime, the EU gave the deal the green light.

Concentrating so much of the country's output in one location will raise the risk of a terrorist attack, Szel argues. On completion, the plant will produce 60% of Hungary's power.

Related Articles

Erste Bank sees modest rebound for Hungary in 2024

Hungary’s economic rebound should be much slower than earlier anticipated in 2024 and GDP is set to expand 2.0% after a 0.9% contraction in 2023, Erste Bank said in a note. Officially, the ... more

Hungary's OTP beats forecasts with stunning 2023 earnings

Hungary’s leading lender beat even the most bullish forecasts in its Q4 earnings report, which showed consolidated after-tax profit rising 15% year-on-year to HUF133bn (€340mn) and full-year ... more

Moody's affirms K&H's 'A3' long-term deposit ratings

Credit rating agency Moody's affirmed the A3/P-2 long- and short-term deposit ratings of K&H Bank, the Hungarian unit of KBC, with a stable outlook. It also affirmed K&H's ba1 Baseline Credit ... more

Dismiss