New EU proceedings launch against Hungary over motorway concessions
The European Commission has initiated infringement proceedings against Hungary’s motorway concession, citing concerns over the lengthy 35-year agreement. However, contrasting international examples suggest otherwise, prompting the Hungarian government to stand firm.
Proceeding against Hungary due to motorway concession
According to Világgazdaság, the Hungarian government is defending a motorway contract amidst legal action, dismissing claims by the European Commission. The Commission initiated infringement proceedings against Hungary, citing concerns over transparency, operational risk transfer, and the contract’s duration. However, the government refutes these claims, viewing the situation differently.
The Hungarian government defends its decision on concession motorways, criticising Brussels for alleged double standards. They argue that the concessions aim to enhance the country’s road network, promote economic development, and improve social mobility. Key objectives include extending motorways to national borders, ensuring accessibility to economic centres, and reducing journey times.
The government highlights the benefits of the concession contract, including the construction of new motorways and operational risk transfer to the concessionaire. They stress that the duration of the 35-year concession aligns with international norms and allows for substantial infrastructure development that would not be feasible with EU funding constraints.
The situation in other countries
The notion that the 35-year Hungarian motorway concession is excessively long is misguided when compared to concession terms across various countries. In Spain, where motorway concessions are prevalent, durations typically range from 30 to 35 years, with some extending to 55 or 75 years.
Similarly, the United Kingdom has operated numerous concessions with durations of 30 to 35 years, while Germany’s motorway concessions typically span 30 years. France has seen concession contracts exceeding 60 years, and Italy has examples of 50-year concessions.
Moreover, concession motorways are common in Poland, Slovakia, Belgium, Austria, Ireland, Portugal, and Australia, indicating widespread acceptance of this model globally. This international precedent demonstrates that the 35-year duration chosen for the Hungarian motorway concession aligns with standard practice in infrastructure development contracts.
The government’s reaction
The Government Information Centre affirmed the government’s commitment to advancing the Hungarian economy for the betterment of its citizens’ quality of life. It pledged to take all necessary legal measures to defend the challenged concession contract, which Brussels contested on unsubstantiated grounds. The government now faces a two-month window to respond to the European Commission’s objections before determining its course of action regarding the infringement procedure.
Tamás Németh, CEO of the Hungarian Concession Infrastructure Development Company, expressed concerns over perceived double standards in the treatment of concession contracts, highlighting instances where contracts have been amended elsewhere without issue. Németh questioned the political motivations behind the scrutiny faced by Hungarian concessions, emphasising the state’s cautious approach to navigating the situation.
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There goes the EU interfering once more. Does the EU have nothing to do but interfere in Hungarian internal affairs?
@mariavontheresa … Guess who is paying for most of this? Our Politicians are quick to take credit, as the EU funds the projects. We don´t have all that much money – https://ec.europa.eu/eurostat/web/products-euro-indicators/w/2-22042024-ap
Fun fact: when Hungary issues bonds to fund debt, due to us being so special, we pay the highest interest rates in the EU:
https://www.investing.com/rates-bonds/european-government-bonds
So – having the EU send us free money is VERY important, even our Politicians understand this. To do stuff, maybe give teachers, doctors and nurses a raise, improve crumbling infrastructure, look good for the electorate which does not appear to understand how state funding works, even a very Sovereign one like ours!