Dubai billionaire receives aid from the Orbán government
It seems that the Hungarian Orbán government does not follow the support-those-most-in-need principle when it comes to giving financial aid to establishments and enterprises to help combat the hardships of the restrictions entered into force due to the coronavirus pandemic.
As part of the safeguarding of the Hungarian tourism sector, the Hungarian government reimburses 80% of the income loss of hotels and other accommodations of the first 30 days following the second closure of the sector. This means that every application received by the Hungarian National Tourism Data Supply Centre by 8th November 2020 eligible for the criteria will receive this aid.
Recently, the government moved into the second stage and started giving out the financial aid for hotels and other establishments that were hurt by the shutdown of the tourism sector but ended up handing HUF 9.6 million (€ 26,000) to a hotel in Budapest owned by a Dubai billionaire.
Mfor found out about this when looking at the document published by the Hungarian Tourist Agency (MTÜ) containing the list of the recipients of the aid mentioned above. From this document, it is evident that the Adria Palace Ltd. received €26,000 for their Ritz-Carlton Budapest hotel. Adria Palace is in the ownership of Al Habtoor Ltd., member of the Al Habtoor Group.
The peculiarity of this is that the founder is a businessman called Khalaf Al Habtoor who has been featured in Forbes’s 500 Richest People In The World several times.
His estimated wealth was around $2.5 billion back in 2011, and the businessman’s company was the one to build the first seven-star hotel, the Burj Al Arab, in the world. About a year ago, Khalaf Al Habtoor announced that he was going to open a regional office in Hungary. The businessman wants to expand in Europe, especially in Central and Eastern European countries due to the skilled workforce, good costs, and rapidly growing infrastructure coupled with the generally low-risk investment environment of the European scene.
For his investments in Hungary and thus helping the development of the country, Khalaf Al Habtoor even received the fourth-highest state order available in Hungary. The hotel in question which was eligible to receive the aid was purchased by the billionaire for more than HUF 18 billion (€49,315,000) back in 2012 and was originally called Le Meridien until a name change to Ritz-Carlton Budapest three years after the purchase. And even though, arguably, the Ritz-Carlton Budapest was not the best of investments, as it generated a total of HUF 144 million (€395,000) loss in 2019 despite a whopping revenue of HUF 4.8 billion (€13,150,000) the same year, this was not the reason behind the Hungarian government’s aid.
Even though there was a noble intention behind the program, it had a major fault, and that is the fact that it simply did not take into account a most-in-need principle.
The sad thing is that any hotel eligible for the initial criteria can receive the aid regardless of their owner’s financial situation, the country they are operating in, or their company’s registered headquarters, as no further background checks were ordered. This created a situation where, indirectly,
the business of a billionaire living abroad received an amount of financial help that could have saved several domestic enterprises from shutting down or having to cope with the hardships of a major financial loss.
Whether this fault will translate into the aid of restaurants and other impacted catering units is unclear, but hopefully, help will reach those most in need.
Read alsoKhalaf Ahmad Al Habtoor: Hungary, Europe’s rising star
Featured image: facebook.com/ritzcarltonbudapest
Source: Mfor.hu