HUG Magazine 2017 EN - Issue 4. (№8) by PAIGEO - Pallas Athene Innovation and Geopolitical Foundation

2017 / IV.

ISSN 2498-647X

CENTRAL EUROPEAN REPORT THE GEOGRAPHICAL PIVOT OF HISTORY THE VISEGRAD COOPERATION CENTRAL EUROPE â&#x20AC;&#x201C; THE NEW EUROPE HUNGARY ON THE PATHWAY TO ECONOMIC CATCH-UP NEW WORLD ORDER CONFERENCE GEOPOLITICAL AND STRATEGIC FACTORS BUDAPEST GUIDELINES

FOREWORD

Dear Readers, The 16+1 Cooperation Summit of China and Central and Eastern European countries was held in Budapest in November, 2017. The 16+1 Cooperation has become the most important institution of the region. Especially because new cooperations, new value systems are evolving in the new global world order following the economic crisis, and the region has emerged both in an economic and a geopolitical sense. It has risen to be a bridgehead region from its previous situation defined as being a periphery or a ‘ferry state’. It boasts the highest economic growth and the lowest unemployment rate in the Union, it is the safest region in Europe, and simultaneously, Hungary has been holding presidency over the cooperation of the Visegrad 4 countries since July, 2017. In the present issue of HUG Magazine, we are focussing on this region. Halford John Mackinder was born 157 years ago, and wrote his study entitled The Geographical Pivot of History, considered to be the most important thesis of geopolitics, 113 years ago. We are looking at the present and the future of Central and Eastern Europe in this new world order. In her paper Central and Eastern European Countries in the Multipolar World of the 21st Century, Ágnes Bernek is presenting the changes taking place since 1990, and outlining a kind of future vision towards a novel geopolitical mindset, describing how the Central and Eastern European region is becoming the bridgehead region of the Eurasian supercontinent of the 21st century.

In the present issue, we are introducing the 2017-18 programme of the Hungarian presidency of the Visegrad Group in detail, and such interesting study papers as the one about the New Europe being born in the region. We are presenting the outcomes of the ChinaCEEC Summit, as well as the results of the investment funds of One Belt, One Road and the investments have made to date. Simultaneously with China’s Prime Minister visit to Budapest in November, 2017, the New World Order Conference organised by the research institute of PAGEO was seeking the answer to the question whether we are still living in a unipolar world, or we are witnessing the emergence of a multipolar world order. The conference focussed on the role of international institutions, the century of Asia’s and China’s rise, and the role of the European Union in the changing new world order. Who could be the winning nations, communities and leaders of this era? In this era, interconnectivity and complexity are given the most important role, new regional cooperations, such as the role of the Visegrad 4 and the 16+1 countries, are strengthened. This is what the eighth issue of HUG Magazine is about; please join us to explore the birth of the New Europe.

Yours faithfully,

Norbert Csizmadia Pallas Athene Innovation and Geopolitical Foundation Chairman of the Board of Trustees HUG Editor-in-Chief

TABLE OF CONTENTS 138

Geopolitical and Strategic Factors

148

Strategic Raw Materials of the Earth

The Geographical Pivot of History

162

Budapest Guidelines

Central and Eastern European Countries in the Multipolar World of the 21 st Century

168

A New Era for Rail Freight Transport between China and Europe

About the V4 Cooperation

Programme of the Hungarian Presidency of the Visegrad Group 2017/2018

106

The New Europe is Born Here, in our Region

110

Viktor Orbán’s Speech at the 28th Tusványos Summer Open University and Student Camp

122

Hungary on the Path to Economic Convergence

130

New World Order Conference

174

The China-Cee Investment Fund, the Silk Road Fund and the Sino-Cee Fund

180

Introduction of the China-CEEC Think Tanks Network

184

The Future in Budapest

190

Book Recommendations

192

CEO, China. The Rise of Xi Jinping by Kerry Brown

THE GEOGRAPHICAL PIVOT OF HISTORY 8

THE GEOGRAPHICAL PIVOT OF HISTORY Author: István Szilágyi

Scottish-born Halford John Mackinder was born in Gainsborough on 1 st February, 1861 and died in Dorset on 6th March, 1947 at the age of eighty-six. This founder and leading figure of the Anglo-Saxon geopolitical school and geopolitical thinking lived an extremely active, busy and diverse life. Halford John Mackinder His career could have constituted the careers and pursuits of even five men, Geoffrey Sloan argues. “It covered the fields of higher education, service education, diplomacy, politics, exploration and public service.” He studied geography and history. After receiving his degree, he was Reader in Geography at the University of Oxford from 1887 to 1905. In 1892, he was a founder, and until 1903, the Principal of University Extension College, Reading. In 1895, he was one of the founders of the London School of Economics. He became director of the institution between 1903 and 1908. In 1899, Mackinder was the driving force behind the creation of a School of Geography at Oxford University. In the same year, he led an expedition which was the first to climb Mount Kenya. In 1902, he published Britain and the British Seas, which included the first comprehensive geomorphology of the British Isles. After the Anglo-Boer Wars, he promoted the inclusion and institutionalisation of geography as an independent field of study in British higher education. He was elected to Parliament as Unionist Party member for the Glasgow Camlachie constituency between 1910 and 1922. After his good friend Lord Curzon had been appointed as Secretary of State for Foreign Affairs, he acted as British High Commissioner in Southern Russia in late 1919 and early 1920. His report on the given matter dated in 1919 and his address delivered to the British cabinet in January, 1920 are documents of geographical viewpoints and scientific analyses, completing each other in very fortunate ways.

Saul Bernard Cohen thinks that one of Sir Halford Mackinder’s greatest merit is his ability to foresee the ending of the Victorian era. In order to safeguard British imperial interests, he developed his theory about the Pivot Area, the Heartland, the Midland Ocean and the Lenaland by combining history as well as European and Asian civilisations, and outlining their interrelations. He regarded the world as a closed system, which was based on equilibrium, but was moving and changing continually. The relevance and significance and his theoretical system, applicable to consecutive, still closely related historical eras with different characteristic features, is still felt today. Although Mackinder is regarded as one of the fathers of geopolitics by the international scientific community, the geographer of Scottish descent never used the term in his works.

Sir Halford John Mackinder

He retired as a university professor in 1925. However, his activity in public and scientific life did not decrease. His career continued to advance. He served as chairman of the Imperial Shipping Committee in 1920–45 and of the Imperial Economic Committee from 1926 to 1931. He was the vice chairman of the Royal Geographical Society between 1932 and 1936. Until 1942, he was member of several Royal Committees. In 1943, he received Charles P. Daly Medal of the American Geographical Society and the highest honour, the Patron’s Medal of Royal Geographical Society in 1945.

The Mackinder content of the notion, however, can be well reconstructed from his works. As Gusztáv Molnár interprets it, “geopolitics – according to Mackinder’s very simple formula – is nothing else than the rational «methodology» of creating and maintaining the global balance of power. In order for the method to be effective (that is, to lead to the successful enforcement of interests of power), nothing else is required than considering «geographical conditions, both economic and strategic,» of states having global and/or regional significance or of empires not having all the characteristics of statehood but operating in a state-like way in at least certain aspects, and «the relative number, virility, equipment and organisation of competing peoples». That is, the methodology of geopolitics can be used effectively only by powers having an adequate size, economic resources and population, solid social and political structures and similarly stable governance, as well as a global capacity to act.” THE DECLINE OF THE BRITISH EMPIRE According to Mackinder’s already mentioned insight, it was the global balance of power based on British imperial hegemony that was threatened at the turn of the 20th century. The British Empire encompassed more than 30 million square metres, and a quarter of the world’s population. By the time it had reached its largest extension, it entered a phase of decline. On the basis of the experiences gained in the Anglo-Boer Wars, the successful fight of Orange and Transvaal provinces against England

was identified by Mackinder as a sign of this. His standpoint was that the pre-Columbian age ended in 1900. The world entered the post-Columbian age of global transformation. In the new historical epoch, the relationship between space and time changed due to technical-technological development. Physical distance between them decreased. Traditional societies entered a period of intensive, rapid dissolution and change. The world witnessed a migration movement akin to a new mass migration. between 1871 and 1911, more than ten million people left Great Britain and Ireland. By contrast, the population of the United States of America grew by more than 20 million immigrants. Irish aspirations for independence also strengthened, and led to the creation of the Irish Free State in 1922.

“Thus, the relationship between land power and sea power changed in the globalised post-Columbian age.” As a consequence of the above-mentioned fastpaced technical-technological development and economic upturn, rail (and air) transport gained increasing significance. This was felt both in international trade and military moves and manoeuvres of a war-like nature. For example, the trans-Siberian Railway was built between 1890 and 1904. The opportunity that Russia, a land power in possession of important regions, would become a land power and a sea power, was created thereby. This attempt was evidenced by the Russo-Japanese War. Thus, the relationship between land power and sea power changed in the globalised post-Columbian age. In the new historical epoch, the hegemonic conditions modified for the benefit of land power. This benefit is crystallised in the case of Russia, which is able to demonstrate both land and sea characteristics, and of Germany, producing dynamic development. All these factors and changes pose a threat to both the balance of power that have evolved within the closed international system and the hegemony of the British Empire. In order

THE GEOGRAPHICAL PIVOT OF HISTORY

to tackle this, Mackinder, on the one hand, made a proposal to create a Commonwealth-like community serving British interests and resulting in a cooperation in foreign policy and economy, and, on the second hand, he saw the reform of the liberal state inevitable. Finally, he called attention to the dangers of a possible alliance between two land powers with a historical perspective, i.e. Germany and Russia. He believed that the formation of this coalition must be prevented for the sake of a balance of land power and the hegemony of the British Empire. At the beginning of the century, Mackinder did not take the presence of the United States on land and in the global system into account. He considered the United States as an eastern power concentrating on the Pacific region and Latin America, which influenced the European balance indirectly, through Russia. He publicly explained the geographical-strategical and region-specific geopolitical consequences of the outlined train of thoughts on 25th January, 1904. 1904: THE GEOGRAPHICAL PIVOT OF HISTORY On this day, Mackinder delivered a lecture entitled The Geographical Pivot of History at the Royal Geographical Society. “When historians in the remote future come to look back on the group of centuries through which we are now passing, and see them foreshortened, as we today see the Egyptian dynasties”, the first sentence of Mackinder’s paper reads, “it may well be that they will describe the last 400 years as the Columbian epoch, and will say that it ended soon after the year 1900. (…) From the present time forth, in the post-Columbian age, we shall again have to deal with a closed political system, (...). (…) Probably some half-consciousness of this fact is at last diverting much of the attention of statesmen in all parts of the world from territorial expansion to the struggle for relative efficiency. It appears to me, therefore, that in the present decade we are for the first time in a position to attempt, with some degree of completeness, a correlation between the larger geographical and the larger historical generalizations. For the first time we can perceive something of the real proportion of features and events on the stage of the whole world, and may seek a formula which shall express certain aspects, at any rate, of geographical causation in universal history.”

In the rest of his lecture, Mackinder focusses on the historical processes determining the diverging social development of Europe and Asia, presenting and explaining the consequent civilizational differences and examining elemental factors conceiving great attempts and ideals nurtured by them. “I ask you, therefore”, he addresses his audience, “for a moment to look upon Europe and European history as subordinate to Asia and Asiatic history, for European civilization is, in a very real sense, the outcome of the secular struggle against Asiatic invasion.” The history of Asia and Europe was formed by the struggle against the invasion of Turanian nomad peoples. It brought different results in the West, on the Russian and partly

Figure 1: The Pivot Area, 1904

the Polish steppes. “While the maritime peoples of Western Europe have covered the ocean with their fleets, settled the outer continents, and in varying degree made tributary the oceanic margins of Asia, Russia has organized the Cossacks, and, emerging from her northern forests, has policed the steppe by setting her own nomads to meet the Tartar nomads. The Tudor century, which saw the expansion of Western Europe over the sea, also saw Russian power carried from Moscow through Siberia. The eastward swoop of the horsemen across Asia was an event almost as pregnant with political consequences as was the rounding of the Cape, although the two movements long remained apart. (…) But trans-continental railways are now transmuting the conditions of land-power, and nowhere can they have such effect as in the closed heart-land of Euro- Asia (…). Is not the pivot region of the world's politics that vast area of Euro-Asia which is inaccessible to ships, but in antiquity lay open to the horse-riding nomads, and is to-day about to be covered with a network of railways?.

“Thus, the region of Eurasia is the pivot region; outside the pivot area, there is a great inner crescent.” Thus, the region of Eurasia is the pivot region, and Russia is the state that, due to its strategic position, will replace the former Mongolian Empire. “In the world at large she occupies the central

Source: Halford John Mackinder: The Geographical Pivot of History. Geographical Journal, Vol. 23, 1904, pp. 435)

strategical position held by Germany in Europe. (…) Nor is it likely that any possible social revolution will alter her essential relations to the great geographical limits of her existence”, Mackinder provides his brilliant insight. Outside the pivot area, there is a great inner crescent, including Germany, Austria, Turkey, India, and China. An outer crescent is constituted by Britain, South Africa, Australia, the United States, Canada, and Japan. Mackinder saw a danger in the oversetting of the balance of power in favour of the pivot state, resulting in Russia’s expansion over the marginal lands of Eurasia. She would use the vast continental resources acquired for fleet-building, signalling the birth of an empire of the world. This might happen if Germany were to ally herself with the Russian tsar. This must be prevented by all means as it would result in the complete overset of the European balance of power. This requires the coalition of the inner and outer crescent based on the strategic alliance between Britain and France. Having control over the pivot region and drawing the conclusions from this do not depend on prejudices about specific countries. “I have spoken as a geographer”, Mackinder continues. “The actual balance of political power at any given time is, of course, the product, on the

one hand, of geographical conditions, both economic and strategic, and, on the other hand, of the relative number, virility, equipment, and organization of the competing peoples. In conclusion, it may be well expressly to point out that the substitution of some new control of the inland area for that of Russia would not tend to reduce the geographical significance of the pivot position.” In 1904, Mackinder estimated Germany more dangerous in terms of oversetting the balance of power and impairing the British hegemony, therefore he advocated an alliance with France. With the Anglo-French agreement signed in 1904, the “entente cordiale” initiative, Britain created Western Europe as a coherent geopolitical region (Figure 1). 1919: THE HEARTLAND THEORY Mackinder’s concept of the pivot region was modified in 1919 due to changes in international affairs. The ending of World War I prompted Mackinder to review his assumptions about Russia and Germany, as well as the future geographical-geopolitical changes in the balance of power. In his book, Democratic Ideals

THE GEOGRAPHICAL PIVOT OF HISTORY

Figure 2: Mackinder’s world in 1919

Figure 3: Europe’s division by Mackinder

Source: Democratic Ideals and Reality. A Study is the Politics of Reconstruction by Halford John Mackinder. Constable and Company Ltd. London, 1919, p.154.

Source: Geopolitics: The Geography of International Relations by Saul Bernard Cohen: Rowman & Littlefield Publishers, Inc. New York, 2009, p. 15.

and Reality, published in 1919, he introduced two new notions of geostrategy. By expanding the geographical scope of the pivot region formulated in 1904, Heartland and the category of World Island, including the continental regions of Eurasia as well as Africa called the Southern Heartland, appeared (Figure 2). As it is illustrated by Figure 8, Mackinder regarded Central-Eastern Europe, which he dubbed as a strategical addition, as part of the Heartland. The European Coastland and the Asian Monsoon Coastland encompassing India and China. „That whole patch, extending right across from the icy, flat shore of Siberia to the torrid, steep coasts of Baluchistan and Persia, has been inaccessible to navigation from the ocean. The opening of it by railways for it was practically roadless beforehand and by aeroplane routes in the near future, constitutes a revolution in the relations of men to the larger geographical realities of the world. Let us call this great region the Heartland of the Continent.”

The concept was reformulated based on the changes occurring after1918. When World War I ended, three great European continental empires had disappeared, and the situation of Germany had also changed. In Russia, the Bolsheviks had come into power. The Austro-Hungarian Monarchy and Turkey had dissolved. The latter one was driven out of Europe. Germany was defeated. In terms of the rivalry of land power and sea power, that is, international affairs, the East European region, divided into small states and filling the resulting power vacuum, had strategic significance. Mackinder thought the continent, divided into Western and Eastern Europe, had become again a scene of rivalry of Empires (Figures 3 and 4.). In this geopolitical situation, Mackinder’s strategy was reformulated by applying the famous cascading “Who rules” formula. All this was paired up with the idea of creating balance between the Germans and the Slavs and of establishing a system of alliances ensued by democratic ideals, based on equality, having a full life, and following an Anglo-Saxon pattern.

“We defined the Heartland originally in accordance with river drainage; but does not history, as thus recounted, show that for the purposes of strategical thought it should be given a somewhat wider extension?”, Mackinder writes. Regarded from the point of view of human mobility, and of the different modes of mobility, it is evident that since land-power can to-day close the Black Sea, the whole basin of that sea must be regarded as of the Heartland. Only the Bavarian Danube, of very little value for navigation, may be treated as lying outside.

Figure 4: Europe’s division by Mackinder

Source (in Hungarian): Democratic Ideals and Reality (Demokratikus ideálok és a valóság) by Halford John Mackinder. In: Thesaurus of Geopolitical Texts (Geopolitikai Szöveggyűjtemény) by Sándor Csizmadia, Gusztáv Molnár, Gábor Zsolt Pataki; Centre for Strategic and Defence Studies. Budapest, 1999, p. 30.

One more circumstance remains to be added, and we shall have before us the whole conception of the Heartland as it emerges from the facts of geography and history. The Baltic is a sea which can now be "closed" by land-power. (…) under the conditions of to-day, (…) the fleets of the islanders could no more penetrate into the Baltic than they could into the Black Sea. The Heartland, for the purposes of strategical thinking, includes the Baltic Sea, the navigable Middle and Lower Danube,

Figure 5: The Pivot Area and the Heartland, 1919

Source: http://www.google.hu/imgres?imgurl=http

THE GEOGRAPHICAL PIVOT OF HISTORY

the Black Sea, Asia Minor, Armenia, Persia, Tibet, and Mongolia. (…) It is evident that the Heartland is as real a physical fact within the World-Island as is the World-Island itself within the ocean, although its boundaries are not quite so clearly defined.” (Figure 5).

Figure 6: The Heartland, with the addition of river drainage

commands the World-Island: Who rules the World-Island commands the World.” The commentaries on the democratic structures and operations of the new world order form an

conquered and more or less forcible Teutonized. On the map thus divided let us "think through" the history of the last four generations: it will assume a new coherency.” (Figures 6 and 7).

In the latest great war, Berlin had supplanted Petrograd as the centre of danger in East Europe. The lesson that we can learn from this, Mackinder believes, is that “West Europe, both insular and peninsular, must necessarily be opposed to whatever Power attempts to organize the resources of East Europe and the Heartland. Viewed in the light of that conception, both British and French policy for a hundred years past takes on a large consistency. We were opposed to the half-German Russian Czardom because Russia was the dominating, threatening force both in East Europe and the Heartland for half a century. We were opposed to the wholly German Kaiserdom, because Germany took the lead in East Europe from the Czardom, and would then have crushed the revolting Slavs, and dominated East Europe and the Heartland. Unless

commands the Heartland: Who rules the Heartland

„ Let us now divide our Europe into East and West by a line so drawn from the Adriatic to the North Sea that Venice and the Netherlands may lie to the west, and also that part of Germany which has been German from the beginning of European history, but so that Berlin and Vienna are to the east, for Prussia and Austria are countries which the German has

After Waterloo, East Europe was united by the Holy League of the three Powers Russia, Austria, and Prussia, Mackinder argues. British naval power continued the while to envelop West Europe. In 1850 Russia and Austria refused to allow the king of Prussia to accept the All-German, as it would have led to the virtual unity of East Europe and Prussia due to the shifting balance of power, and nothing would have curb Berlin’s control over the region. Thus, the peculiar unity of East Europe was asserted in 1850. But when Bismarck became chancellor in Berlin, German unity was achieved with Prussian leadership. Therefore, the center of power in East Europe was now Prussia.

„Who rules East Europe

Source: Democratic Ideals and Reality. A Study in the Politics of Reconstruction by Halford John Mackinder; Constable and Company Ltd. London, 1919, p. 135.

Figure 7. : The Heartland, with the addition of river drainage

you would lay up trouble for the future, you cannot now accept any outcome of the war which does not finally dispose of the issue between German and Slav in East Europe. You must have a balance as between German and Slav, and true independence of each. You cannot afford to leave such a condition of affairs in East Europe and the Heartland, as would offer scope for ambition in the future, for you have escaped too narrowly from the recent danger.”

important part of Mackinder‘s study published in 1919. Mackinder foresaw the decline of the hegemony of the British Empire. On an international scene, in interstate foreign affairs, he contributed considerable influence to federal systems based on equality before the law. Within national frameworks, in intrastate affairs, he attributed a universal nature of the federal systems operating in the United States, Canada, Australia and South Africa. He was also a supporter of Irish and Scottish devolution attempts demonstrated in Great Britain. “The federal authority, whether of the league or the nation, is constituted of communities of complete growth, and cannot, from its nature, aspire to empire, since it consists everywhere of balanced humanity.” Mackinder’s last sentences, contrary to his former remarks on and analyses of realpolitik, reverberate the theorems of the idealist paradigm of the international relations theory, advocated by US President Woodrow Wilson. 1943: MIDLAND OCEAN – LENALAND THEORY We could see that Mackinder had created such a continuously renewing and self-modifying, dynamically changing worldview reflecting shifts in international relations in a future-oriented and systemic way that is in the stat of perpetual mobility and modification. In his article The Round World and the Winning of the Peace, published in the 4th issue of Foreign Affairs in July, 1943, he expressed fundamental ideas and considerations on the system of international relations following World War II. In this article, he re-evaluates the strategic questions of the relationship between sea and land powers. In

the introduction to his study, he reviews his concept formulated in 1904 and 1919. He discards his theorem, acquiring fame since 1919, that the rule over the Heartland is identical with rule over the Word Island, and asks the question as to “…. whether my strategical concept of a »Heartland« has lost any of its significance under the conditions of modern warfare.” ""I have described my concept of the Heartland, which I have no hesitation in saying is more valid and useful today than it was either twenty or forty years ago”, he continues. In 1943, Mackinder perceived the Heartland as primarily the Eurasian forest and steppe zone forming a part of the central region of the Soviet Union. “The Heartland is the northern part and the interior of Euro-Asia. It extends from the Arctic coast down to the central deserts, and has as its western limits the broad isthmus between the Baltic and Black Seas. The concept does not admit of precise definition on the map for the reason that it is based on three separate aspects of physical geography which, while reinforcing one another, are not exactly coincident." It is on the widest lowland plain on the face of the globe, on some great navigable rivers, certain of which go north to the Arctic Sea and are inaccessible from the ocean because it is cumbered with ice, while others flow into inland waters, such as the Caspian, which have no exit to the ocean; thirdly, there is here a grassland zone which, until within the last century and a half, presented ideal conditions for the development of high mobility by camel and horse-riding nomads. “…the Heartland provides a sufficient physical basis for strategical thinking”, Mackinder writes. „For our present purpose it is sufficiently accurate to say that the territory of the U.S.S.R. is equivalent to the Heartland, except in one direction. In order to demarcate that exception – a great one – let us draw a direct line, some 5,500 miles long, westward from Bering Strait to Rumania. Three thousand miles from Bering Strait that line will cross the Yenisei River, flowing northward from the borders of Mongolia to the Arctic Ocean. (…) this I shall call Lenaland, from its central feature, the great River Lena. This is not included in Heartland Russia.” (Figure 8)

THE GEOGRAPHICAL PIVOT OF HISTORY

Figure 8: Changing Heartland boundaries

Figure 10: The Midland Ocean and Lenaland

Source: Geopolitics: The Geography of International Relations by Saul Bernard Cohen; Rowman & Littlefield Publishers, Inc. New York, 2009, p. 18.

Figure 9: Mackinder’s world, 1943

Source: Geopolitics: The Geography of International Relations by Saul Bernard Cohen; Rowman & Littlefield Publishers, Inc. New York, 2009, p. 17.

Source: Geography and Politics in a World Divided by Saul Bernard Cohen. In: Thesaurus of Geopolitical Texts (Geopolitikai Szöveggyűjtemény) by Sándor Csizmadia, Gusztáv Molnár, Gábor Zsolt Pataki; Centre for Strategic and Defence Studies. Budapest, 1999. p. 75.

Mackinder estimates Lenaland Russia to have an area of three and three-quarter million square miles, but a population of only some six million. The region is very rich in natural resources and minerals. West of Lenaland lies Heartland Russia, a plain extending 2,500 miles north and south, and 2,500 miles east and west. It contains a population of 170 million. “The simplest and probably the most effective way of presenting the strategical values of the Russian Heartland is to compare them with those of France”, Mackinder argues. Heartland Russia has four times the population and twenty times the area of France. The vast potentialities of the Heartland, however, to say nothing of the natural reserves in Lenaland, are strategically well placed for Russia. Therefore “…if the Soviet Union emerges from this war as conqueror of Germany, she must rank as the greatest land Power on the globe. Moreover, she will be the Power in the strategically strongest defensive position. The Heartland is the greatest natural fortress on earth. For the first time in history it is manned by a garrison sufficient both in number and quality.”

“The winning of peace, according to the new concept was formulated as follows: Who commands the Heartland rules the World-Island; Who commands the World-Island rules the World.” For safeguarding freedom, this concentration of power must be counterbalanced by land power, Germany’s reinventing itself, to the east, in the Heartland, and sea power to the west, in the North Atlantic basin. This is how the Unites States, Canada, Great Britain, France, Western Europe and the coastal zone meet in the Midland Ocean zone. The North Atlantic Alliance, based on the joint efforts of English-speaking peoples and led by the United States, in possession of a regained advantage of a sea power supplemented by air force, is suitable for neutralising the natural fortress of power of the Heartland and halt the U.S.S.R.

The winning of peace, according to the new concept was formulated as follows: Who commands the Heartland rules the World-Island; Who commands the World-Island rules the World.” This also ensures “a balanced globe of human beings. And happy, because balanced and thus free", the last sentence of Mackinder’s article reads (Figures 9 and 10). As a summary, we can say that Sir Halford John Mackinder was coupled with an even richer intellectual legacy. By studying the conditions of the idea of British Empire and those of maintaining the dominance of sea power occurring in given historical periods, he came up with drafting the concepts of pivot region, Heartland, World-Island, Midland Ocean and Lenaland. In his theoretical system, the long-term, permanent effect of the geographical environment determining history, the cooperation, changes and relationships of civilisations and the development of states and political entities, plays a central role. He explains human history as a part of the world organism. He highlights the relationships between geographical and political decisions. As for the changes in international relations, he contributes special importance to the geographical location of states, the geographical space influenced also by technical advancement, zones with specific features and their implications. By simultaneously studying and combining three different disciplines – geography, history and international relations theory – and adopting an interdisciplinary perspective, he was one of the intellectual founders of the international system evolving after World War II. His name can be associated with the doctrine of containment, the establishment of the North Atlantic Alliance, the creation of European integration and the idea of interacting and competing civilisations as well.

Central and Eastern European Countries in the Multi-polar World of the 21st Century

Transition from being the 20th century’s Buffer Zone between East and West to the “bridge region” of Eurasia in the 21st century Author: Ágnes Bernek

When it comes to defining the geopolitical role of the Central and Eastern European region, the main question is usually whether it belongs to the West or to the East. The West and East distinction is still the basis of our thinking about the international geopolitical space, although the closing of the Cold War Period in the 1990s has made the international distinction based on this logic pointless. Still, is it possible at the beginning of the 21 st century that the Central and Eastern European countries change their traditional geopolitical attitude, especially their entrenched stereotypic approach about “looking up to the West and looking down on the East”? By 2018 it has become evident that in place of the unipolar world, built on the global political and economic hegemony of the USA and the Atlantic field of power, there is a new multi-polar world on the rise. In the USA’s global role of “first among equals” has now come to end and geopolitically it can be stated that spatial diffusion of power has begun. What will the multi-polar world be like? Since this evolving multi-polar world is still lacking a regulatory framework, the extremely volatile nature of our world can primarily be traced back to the so-called systemic geopolitical threats. With China becoming the second biggest national economy of the world, political and economic models and eco-

nomic approaches other than the Anglo-Saxon set of rules of world economy are also gaining ground. The so-called non-Anglo-Saxon world is already taking shape (though, for now, in co-existence with the AngloSaxon world). Thus, the dominance of the traditional “Western” world is highly questionable. The “grand geopolitical chessboard” of the 21st century, however, has transformed profoundly, and due to the 2008 crisis of the European Union and other European countries the world’s centre of gravity has shifted to the Pacific field of power. The “grand strategies” of the 21st century are, by now, investigated solely in the light of the

geopolitical interests of three political world powers, namely the USA, Russia and China. The globe is turning and every forecast seems to suggest that the 21st century will see the downfall of Europe. And in addition to that, slowly but surely, the Eurocentric world view is going to change, thus bringing about a shift in the interpretation of the traditional North–South and West–East division of the international order. That is, in cartographic terms, the zero point will change and the world will no longer be interpreted only through Brussels and Washington but through Beijing and Moscow, as well. Therefore, we must work out a new geopolitical view of space. In spite of that, we are witnessing a renaissance of the orthodox (traditional) geopolitical approach. Indisputably, the most often cited writer of present-day geopolitics is the British geographer Halford J. Mackinder (1861-1947). The most important terms of geopolitics, namely “Heartland” and World-Island are products of Mackinder’s work. “Who rules East Europe commands the Heartland; who rules the Heartland commands the World-Island; who rules the World-Island commands the world." (H. Mackinder, 1919. p. 186.) In recent geopolitical studies the quotation is regularly used in the sense that whoever rules the “Heartland” commands the world. In the 21st century the “Heartland” is placed in the Central Asian region, though in the wake of the Ukrainian events more and more people call attention to the fact that Eastern Europe remains a key player in world politics. In the 21st century the “Heartland” can be defined as the “clashing point” of the geopolitical field. In his political analysis of Europe and Asia Mackinder tried to find out what kind of connection might there be between geographical and historical processes and major events. Mackinder coined the political concept of Eurasia which does not only suggest that Europe and Asia constitute a single unit geologically, but more importantly, that the nations and states of Europe and Asia form the centre of world power. In the quotation above the term “World-Island” refers exactly to Eurasia, the largest continuous continent of the planet. The concept of Eurasia is one of the most disputed nowadays. In the western half of Europe even the sheer existence of the concept is denied and it is usually

equated with Russia or the rebirth of the Soviet Union. In Hungary, in the stereotypical way of thinking characteristic of the Cold War era, Europe is equated the West and Eurasia is identified with the East. The wellestablished political motto, always re-emerging during V. Putin’s visits to Hungary, that we have to make a choice between Europe and Eurasia, is fundamentally flawed both geographically and geopolitically. The reason for that is that Europe in its own right is not a separate continent either geologically or geographically. Even Alexander Humboldt defined Europe as the enormous western peninsula of Asia. The reason why we consider Europe to be a separate continent is rooted to a greater extent in its history, culture and its perception. H. Mackinder described the world’s political structure as a unit consisting of the American continent and the World-Island. Even though everything is in motion, the fundamental question remains the same: Will Halford Mackinder’s World Island ever take shape as an actual geographic territorial unit and will we be able to investigate global political relations in terms of the World-Island—American continent dichotomy in the near future? Will the USA’s policy of containment continue, and if so, how will it actually thwart the creation of a strong economic and political relationship between Europe and Asia? Will a new Eurasian supercontinent be created through the ever-intensifying economic cooperation between Russia and China? What is the new multi-polar world going to be like and what will be the role of Hungary and the Central Eastern European region in the currently evolving Eurasian supercontinent? In the 2000s – from the beginning of V. Putin’s tenure as president and the economic and political consolidation and rise of Russia – the concept of Eurasia was solely associated with Russia’s geopolitical endeavours. Consequently, a post-soviet interpretation was attributed to it, and the Western world ultimately saw the dangerous prospect of the Soviet Union’s rebirth in Russia’s Eurasian geopolitical strategy. It was not by chance that the concept met utter rejection in the countries of the Euro-Atlantic field of power, and that they entirely dismissed the possibility of creating a new European–Asian alliance and field of power with the Russians at its forefront. In 2013, with the introduction and implementation of the “New Silk Road” infrastructural and economic development programme, however, the concept of Eurasia

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

was assigned a new, primarily economic interpretation, and definitively surpassed its post-soviet imperial meaning. This is because for the first time in history there is a realistic economic chance for Europe and Asia to become a single economic field of power, for the eastern end of Europe and the western half of Asia are, in effect, merged. This also means that while earlier the concept of Eurasia was accepted geologically around the world (with the exception of Russia), by now the concept has acquired a new political and economic interpretation. What will be the geopolitical role of the Central and Eastern European region on this new evolving Eurasian continent? From a European perspective it is the periphery of the EU, the eastern half of the European

cooperation of V4 member states with other countries of the Central European region and with countries of the Western Balkans and those involved in the EU’s Eastern Partnership Programme (primarily Belorussia, Moldova and Ukraine).iThe current Hungarian presidency programme carries on the foreign political endeavours of the Polish presidency. The prime goal of the Hungarian presidency sub-programme, called “Regional Visegrad”, is also the strengthening of relationships between the countries of the V4 and Western Balkans. Furthermore, it aims to increase the role of the V4 in elaborating and substantiating the EU’s policy on further expansion through the strengthening relationship with the countries of the

ally by the 16 CEE countries and China. In November 2017, the summit of the “16+1 cooperation” took place in Budapest. However, beyond these three initiatives and forms of cooperation, the evolving Central and Eastern European economic force field is also suggested by the fact that the missing transport sections of the five Trans-European Transport Network (TEN-T) affecting our regions are now being built. The key question is how the TEN-T transport corridors can connect to the main routes of the economic zones of the Chinese New Silk Road. The two European gates to the mainland routes of the economic zone of the Chinese New Silk Road are Terespol/Brest in Poland/Belarus and Záhony in Hun-

continent. But will this region assume a new geopolitical role and will it become a “bridge region” between Europe and Asia? Will it be able to free itself from being caught between West and East? In order for the Central and Eastern European countries to become successful on the long term, they should strive towards becoming a strategically important geographical spot, that are “bridge states” in the multi-polar world of the 21th century. In the current

Eastern Partnership.ii But the great question for the years to come is whether the V4 will expand or not? Will other countries be involved from the region? According to my prognosis for the future the V4 group ought to be transformed into a V7 partnership. Croatia, Slovenia and Austria should be added to the cooperation, and consequently, a new framework of 21st century Central European cooperation should be established.

gary. However, the European gate of the 21st Century Maritime Silk Road is definitely the Port of Piraeus in Greece. At the same time, it is indisputable that a new geopolitical approach, a new geopolitical attitude should be created so that a new Central and Eastern European economic force field can actually emerge for all players of the political, economic and business life. If a couple decades from now in the future we were asked where the Central and Eastern European regions is, what will be our answer? At the eastern end of Europe or in the centre of Eurasia instead?

period of “deglobalisation” and ever-strengthening macro-regions, intensifying the cooperation among the countries of the Visegrad group and establishing a Eastern-Central European economic field of power underpinned by a new north-south infrastructural corridor could serve as a suitable basis for Hungary, too, for adopting a considerably more independent foreign policy strategy. The necessity for the creation of this Central and Eastern European North-South economic (and political) power field has already appeared in the post-World War I. settlement plan of Józef Piłsudski, Polish marshal. Piłsudski coined the term of Intermarium which referred to a closer cooperation between the countries of the region, stretching from the Baltic to the Adriatic and Black Sea, with the aim of retaining their independence. The three highlighted elements, the actual drivers of the new Central and Eastern European economic force field are the following: 1. The Visegrad Cooperation signed in 1991 originally aimed to shorten the process of the Euro-Atlantic integration. Since then, the V4 has become a recognized political “trademark”. The period of the 2016/2017 Polish V4 presidency was the first time during which the Visegrad Group set very serious political goals: intensifying the economic and political

2. The Three Seas Initiative has been launched with the aim of establishing a new North-South link in the Central and Eastern European region. This initiative has set the target of establishing new economic relations between the Baltic, the Adriatic and the Black Sea. The Three Seas Initiative was initiated by Croatia and Poland. The first summit took place in Dubrovnik in the summer of 2016, the second summit was organised in Warsaw in the July of 2017. The main aim of the initiation is to establish a new NorthSouth energetic corridor, stretching from the Baltic Sea to the Adriatic Sea. Its Northern “gate” would be the Świnoujście LNG (liquefied natural gas) terminal in northern Poland, while its Southern “gate” would be the Adriatic Sea LNG terminal in the island of Krk planned to be constructed by 2019.

1. C entral and Eastern Europe – From being “trapped” between East and West to becoming the “bridge region” in the 21st century’s multi-polar world – aims of the study and hypotheses When it comes to defining the geopolitical role of the Central and Eastern European region the main question, usually arising, is whether it belongs to the West or the East? What is more important, the fact that it is the eastern frontier zone of the Atlantic field or more so that it is the westernmost bridgehead of the Eurasian field currently in the making? Though, it should be noted that these are no longer the right questions to ask in the 21st century. These questions belong rather to the traditional North–South and West–East division that was prevalent during the second half of the 20th century. In the 1980s, with the former German Chancellor, Willy Brandt playing a leading role in its conception, the so called Brandt Report was published which depicted a North–South divide with regard to the existing global political and economic discrepancies. The so called Brandt Line divided the globe into developed northern and developing south-

The China-centered, Chinese-language world map

3. The so-called “16+1” cooperation between China and 16 Central and Eastern European countries has been announced in 2011 during his official visit in Hungary Wen Jiabao, former president of the People’s Republic of China. Its aim is to create a new platform for establishing more intense economic relations with Central and Eastern European countries. The “16+1” transregional platform was officially brought into life in 2012 at the Warsaw summit and since then a Prime Ministerial summit has been organised annu-

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The Eurasian continent

ern countries along the 30° north latitude. However, during the Cold War the developed northern world was subdivided into the western capitalist world and the socialist eastern bloc (The Soviet Union and the socialist Eastern European countries) opposing it. The West–East division still forms the basis of our present-day thinking about the geopolitical field, despite the fact that as a result of the regime changes that started from the 1990s the world has become unipolar, and the international division constructed upon Cold War logic has become obsolete. What is more, due to the emerging markets of the previously underdeveloped southern states even the North–South classification has become irrelevant. So much so, that the developing country denomination is no longer used in the global political and economic discourse of the 21st century. It is also imperative to point out that the underlying idea behind the traditional geopolitical interpretation of geographical directions is that the European continent’s central position in the world is self-evident for us. Thus on the world maps we use Europe is always in central position. Consequently, it becomes clear that the North–South and even more so the West–East geopolitical approach is rooted in the fact that we investigate the 21st century’s geopolitical field exclusively from the perspective of Europe. The “grand geopolitical chessboard” of the 21st century, however, has transformed profoundly, and due to the 2008 crisis of the European Union and other European countries the world’s centre of gravity has shifted to the Pacific field of power. The “grand strategies” of the 21st century are, by now, investigated solely in the light of the geopolitical interests of three political world powers, namely the USA, Russia and China. The globe is turning and every forecast seems to suggest that the

21st century will see the downfall of Europe. And in addition to that, slowly but surely, the Eurocentric world view is going to change, thus bringing about a shift in the interpretation of the traditional North–South and West–East division of the international order. That is, in cartographic terms, the zero point will change and the world will no longer be interpreted only through Brussels and Washington but through Beijing and Moscow, as well. Therefore, we must work out a new geopolitical view of space. But in the case of the Central and Eastern European region shaking off the Cold War “shackles” of being caught between West–East is a daunting task. In the wake of the annexation of the Crimean Peninsula in March 2014, due to the standoff between the USA and Russia East-Central Europe has once again gradually become a buffer zone, like so many times throughout history. On the flipside, the multi-polar world currently in the making provides new geopolitical opportunities too. Instead of the “age-old” West–East-based geopolitical thinking we need to adopt a new approach. This will allow for a profoundly new interpretation of the relative geopolitical situation of Central and Eastern Europe in the near future. On the other hand, despite all its inherent risks the evolving multi-polar world provides new geopolitical opportunities too. In my view, the global economic and political role of East-Central Europe and the members of the Visegrad Group in particular could be that of a mediary between the major economic and political power fields in the 21st century. From an economic perspective this could bring about the dominance of transport services and intermediary activities in the field of business and finance in the region. Ideally, Hungary could become a hub for logistics for both western (pri-

marily from North-America and Western Europe) and eastern (predominantly from Russia and China) transnational companies. In my opinion, in order for Hungary to become successful on the long term it should strive towards becoming a strategically important geographical spot, or in geopolitical terms a “bridge state” in the multi-polar world of the 21th century. The evolving Eurasian supercontinent provides an opportunity for that. As a result of the intensified cooperation between Russia and China a new Eurasian field of power is on the rise but the main question is what Asian-European political and economic relations will be like and whether the European continent will constitute a part of Eurasia or not? Can a country as small as ours have its own foreign trade and foreign policy strategy? In the current period of “deglobalisation” and ever-strengthening macro-regions cementing the Visegrad Cooperation and establishing an East-Central European economic field of power underpinned by a new North-South infrastructural corridor could serve as a suitable basis for adopting a considerably more independent foreign policy strategy. The basic concept of the study – the so-called new Eurasia paradigm. Its most important elements are the following: Ø In the 2000s – from the beginning of V. Putin’s ten ure as president and the economic and political consolidation and rise of Russia – the concept of Eurasia was solely associated with Russia’s geopolitical endeavours. Consequently, a post-soviet interpretation was attributed to it, and the Western world ultimately saw the dangerous prospect of the Soviet Union’s rebirth in Russia’s Eurasian geopolitical strategy. It was not by chance that the concept met utter rejection in the countries of the Euro-Atlantic field of power, and that they entirely dismissed the possibility of creating a new European–Asian alliance and field of power with the Russians at its forefront. Ø In 2013, with the introduction and implementation of the “New Silk Road” infrastructural and economic development programme, however, the concept of Eurasia was assigned a new, primarily economic interpretation, and definitively surpassed its postsoviet imperial meaning. This is because for the first time in history there is a realistic economic chance for Europe and Asia to become a single economic field of power, for the eastern end of Europe and the western half of Asia are, in effect, merged.

Ø This also means that while earlier the concept of Eurasia was accepted geologically around the world (with the exception of Russia), by now the concept has acquired a new political and economic interpretation. This will have a profound effect on the general view of the world. Instead of the permanent West–East contrast we will have to take new regional levels into consideration. Ø But what will the regional organisation of the 21st century Eurasia look like? Instead of the traditional centre-periphery relation what will the new relationship of interdependence between Eurasian regions be like? Can the buffer-zones of the past actually be transformed into “bridge regions”? Does Central– Eurasia exist? In what ways is it different from the traditional concept of Central Asia? Ø What will be the geopolitical role of the Central and Eastern European region on this new evolving Eurasian continent? From a European perspective it is the periphery of the EU, the eastern half of the European continent. But will this region assume a new geopolitical role and will it become a “bridge region” between Europe and Asia? Will it be able to free itself from being caught between West and East? The main objective of the study is to contribute to laying the conceptual, current political, diplomatic and economic diplomatic foundation of the Central and Eastern European regions role as a “bridge-zone”. 2. T he evolving multi-polar world of the 21st century – a precarious vision of the future „In the current global economy only two things are certain. First, it is uncertain. Second, the USA is the leading economic and political power of our time.” Excerpt from an interview conducted in 1998. Interviewee: André Kostolany (1906-1999), stock market expert. If we asked André Kostolany today in 2017, he would probably give the following answer: „In the current global economy only one thing is certain. It is uncertain.” By 2018 it has become evident that in place of the unipolar world, built on the global political and economic hegemony of the USA and the Atlantic field of power, there is a new multi-polar world on the rise. In the USA’s global role of “first among equals” has now come to end and geopolitically it can be stated that spatial diffusion of power has begun. As a result the liberal economic model and the American model of democracy are both

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

Changes in US Outward FDI as per direction in 2015 - Based on figures of FDI outward stock

losing of significance. Though Barack Obama claimed on numerous occasions that “democracy is our brand”, it is apparent that the American model of democracy does not fare well outside the Anglo-Saxon world. Furthermore, it is also obvious that nowadays the USA’s global engagement is ahead of changes. Though, these days it is hard to decipher the geopolitical strategies applied in the foreign policy of U.S. president Donald Trump, the American approach is going through a fundamental change. The question is whether Trump and the political and economic elite close to him can actually drive the systemic change of the world and Western society within? What will the multi-polar world be like? Since this evolving multi-polar world is still lacking a regulatory framework, the extremely volatile nature of our world can primarily be traced back to the so-called systemic geopolitical threats. It is indisputable that the post-World War II. framework of the world economy and world politics is in dire need of a change in the 21st century. The actual power of “developed countries” in the traditional sense is declining and big emerging markets have become decisive factors in the world economy. With China becoming the second biggest national economy of the

world, political and economic models and economic approaches other than the Anglo-Saxon set of rules of world economy are also gaining ground. The so-called non-Anglo-Saxon world is already taking shape (though, for now, in co-existence with the Anglo-Saxon world). Thus, the dominance of the traditional “Western” world is highly questionable. A new era of “deglobalisation” has been emerging recently in which regions and regional markets are obtaining more and more significance beside the world’s global market. These regional markets are still managing and shaping their sphere of interests only on a continental or regional level and not on a global scale. For great powers and big emerging markets geostrategic thinking and the construction of macro-regional fields of power has become more important than in the past. The socalled “imperial thinking” has re-emerged as the central element of the major powers’ geopolitical endeavours. What is the spatial organisation “Pax Americana”, that is, the “American Empire” like in the 21st century? With regard to Hungary, the most crucial issue is the nature of the future role envisaged for the East–Central European region within “Pax Russica”, namely in the “Russian Empire” currently evolving on the geographical level of the

Eurasian continent. Moreover, if the 21st century world economy’s centre of gravity shifts to the Pacific field of power then it will restructure the major fields of power overarching the continents and most of all the relationships between them. Though the world is going through fundamental changes, the several-decades-long opposition of the Cold War that ended in the 1990s still lives on in our political thinking and in the conceptual framework used for the study of international relations. Up until now, we have not been able to part with associations of Cold War. Consequently, according to general view, Russia is the arch enemy of the Anglo-Saxon world. The beginning of a new era reminiscent of the Cold War seems to be lingering above us due to the 2014 annexation of the Crimean Peninsula by Russia. In this era the opposition of the West (Euro-Atlantic field of power) and the East (Russia) is becoming starker, the Western world is imposing a plethora of new sanctions against Russia and NATO is increasing and intensifying its military presence in the East-Central European region which has once again became a buffer-zone. Nonetheless, Russian national consciousness and the declaration of Russian independence and geopolitical strategy is much stronger than it was a few years ago. American experts on foreign policy repeatedly state that “Russia as an enemy is more important to us than as a friend”. It is indisputable that the “Russian card” is one of the pivotal elements of American media communication. And underpinning all these ideas is the age-old Cold War principle of “containment” elaborated by George Kennan in 1947. The cornerstone of Truman’s National Security Act of 1947 was to prevent by any means possible (possibly without starting a war) the further expansion of the Soviet power sphere. There seem to be no change in this regard; the USA’s attitude towards Russia and every Eurasian economic/political organisation is till the same. However, establishing the new geopolitical role of the Central and Eastern European region and that of Hungary is an extremely challenging task, since this transitional period – an era of transition from a unipolar to a multi-polar world characterised by the competition and power display of major powers – is very dangerous in terms of national security. The political and economic institutions of the Anglo–Saxon world are no longer fit to properly uphold world order and global economicpolitical stability. The emerging markets (especially the BRICS countries) are not nearly strong enough, and most importantly, they do not form a strong enough alliance either economically or politically to be able to lay the foundations of a new world order. At the same

time the contest between major powers also triggers the weakening or even the elimination of power control over the various spheres of interest. It is an obvious fact that in countries where American influence has declined the expansion of the Russian and/or Chinese sphere of interest has started. Nonetheless, security risks are dramatically increasing due to the evolving power vacuums, and countries or regions uncommitted to either of the power-based spheres of interest as of yet. An example of that are the chaotic Iraqi situation and the unresolved Syrian conflict that followed the withdrawal of American troops and which led to the declaration of the Islamic State on the border of the two countries in 2013. The huge influx of refugees arriving into Europe from early 2015 was also mainly the result of the unresolved Afghan, Iraqi and Syrian conflict and the rise of international terrorism primarily associated with ISIS. 3. E urasia – the orthodox interpretation of the World-Island “Who rules East Europe commands the Heartland; who rules the Heartland commands the World-Island; who rules the World-Island commands the world." (H. Mackinder, 1919. p. 186.) It is apparent that the evolving multi-polar world of the 21st century is in need of new a geopolitical approach and new geopolitical concepts. In spite of that, we are witnessing a renaissance of the orthodox (traditional) geopolitical approach. Indisputably, the most often cited writer of present-day geopolitics is the British geographer Halford J. Mackinder (1861-1947). The most important terms of geopolitics, namely “Heartland” and World-Island are products of Mackinder’s work as is indicated by the above quotation. In recent geopolitical studies the quotation is regularly used in the sense that whoever rules the “Heartland” commands the world. In the 21st century the “Heartland” is placed in the Central Asian region, though in the wake of the Ukrainian events more and more people call attention to the fact that Eastern Europe remains a key player in world politics. In the 21st century the “Heartland” can be defined as the “clashing point” of the geopolitical field. Mackinder’s most famous study is “The Geographical Pivot of History”. He presented it at the meeting of the Royal Geographical Society on 25th January 1904. In his political analysis of Europe and Asia Mackinder tried to find out what kind of connection might there be between geographical and historical processes and

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The Steppes of the world

The boundary between Europe and Asia: the Ural Mountains

major events. Mackinder coined the political concept of Eurasia which does not only suggest that Europe and Asia constitute a single unit geologically, but more importantly, that the nations and states of Europe and Asia form the centre of world power. In the quotation above the term “World-Island” refers exactly to Eurasia, the largest continuous continent of the planet. The concept of Eurasia is one of the most disputed nowadays. In the western half of Europe even the sheer existence of the concept is denied and it is usually equated with Russia or the rebirth of the Soviet Union.

In Hungary, in the stereotypical way of thinking characteristic of the Cold War era, Europe is equated the West and Eurasia is identified with the East. The wellestablished political motto, always re-emerging during V. Putin’s visits to Hungary, that we have to make a choice between Europe and Eurasia, is fundamentally flawed both geographically and geopolitically. The reason for that is that Europe in its own right is not a separate continent either geologically or geographically. Even Alexander Humboldt defined Europe as the enormous western peninsula of Asia. The reason why we

The Pivot Area and the Inner and Outer Crescent – Mackinder 1904

consider Europe to be a separate continent is rooted to a greater extent in its history, culture and its perception. Eurasia is the largest continent of the planet. Its overall territory is 55 million square metres which amounts to 37% of the world’s land surface. The entire are of the American continent is “only” 43 million square meters which makes up 28% of land areas.ii This comparison is of great significance because H. Mackinder described

the world’s political structure as a unit consisting of the American continent and the World-Island. While studying the civilizational conflict between Europe and Asia, Mackinder stated that the Pivotal Area of the world’s history is the huge Russian territory stretching from the Urals to the Pacific Ocean, “which is inaccessible for maritime transport, but in the past it lay open for chivalric nomads, and today its

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

railway network is under construction.” On Mackinder’s map the Pivot Area is surrounded by a big inner crescent, where we find Germany, Austria, Turkey, India and China. The outer crescent is formed by Great Britain, South Africa, Australia, the United States, Canada and Japan. Mackinder finishes his study, “The Geographical Pivot of History” on the following note: “...it may be well expressly to point out that the substitution of some of some new control of the inland area for that of Russia would not tend to reduce the geographical significance of the pivot position. Were the Chinese, for instance, organized by the Japanese, to overthrow the Russian Empire and conquer its territory, they might constitute the yellow peril to the world’s freedom just because they

way is the key to the continuity of the Eurasian Steppe (reaching from the Great Plain in the Carpathian Basin through Ukraine, Russia, Kazakhstan, and Mongolia to the historical Chinese region Manchuria). This great Steppe of the ancient world served as the foundation for the major trade route of medieval times, the Silk Road (for its northern stretch to be more precise), through which the nomad shepherds and caravans connected the eastern and western halves of the Eurasian continent.

would add an oceanic frontage to the resources of the great continent, an advantage as yet denied to the Russian tenant of the pivot region.” This quotation also refers to the fact that the geopolitical stake involved in China’s 21st century “One Belt–One Road” infrastruc-

an endorheic region isolated from seas by drainage divides, characterised by dry climate, the surface area of which is 4 million square kilometres. The region includes Kazakhstan, Kyrgyzstan, Tajikistan, Turkmenistan and Uzbekistan. Owing to the former ancient Silk Road the region was one of the major routes of contemporary world trade. The area, formerly denoted as Turkestan in the 18th and 19th centuries, was later brought under Russian control and with the birth of the Soviet Union its countries became soviet member states. These states gained their independence only after the fall of the Soviet Union, in 1991. Besides the delineation used in physical geography and the country-based demarcation, in the Hungarian literature the area is often denoted as Inner Asia, which designates a more extensive, predominantly culturally and historically defined region. This is an endorheic region of roughly 8 million km2 encompassing temperate steppes and temperate deserts. Culturally and economically speaking, its most distinctive feature is the presence of cattle herder nomadic tribes who lived encircled by sedentary agricultural communities. This dichotomy – nomadic herding and the agricultural lifestyle of desert oases (especially cotton production intended for export) – is still the main traditional economic feature of the region’s countries. The economic development of the five Central Asian countries is highly dependent on the production of crude oil, natural gas and mineral resources. With the exception of Turkmenistan the countries are member states of the Commonwealth of Independent States (free-trade area) and the Shanghai Cooperation Organisation (forum for political cooperation). Furthermore, Kazakhstan is one of the founding members of the Eurasian Economic Union, brought into existence in 2015. Kyrgyzstan, another country in the region, also joined the union.

tural development plan is enormous because if it becomes reality then for the first time in history the three oceans will be successfully connected. This will render it viable to access the seas from Eurasia, that is, from the World-Island, so in other words, in the 21st century China, considered to be a land-based power, and its allies could subdue the western sea powers. The Urals are considered to be the eastern border of Europe, however, in physical geographical terms the mountain range is not a natural but an artificially designated continental border. This is also supported by the fact that the Eastern-European Plain located on the western side of the Urals and West Siberian Plain on its eastern side are similar in every respect geographically. The Urals flatten to a hilly region in the south the majority of which belongs to the Steppe region. This area stretching from the Urals to the Caspian Sea – more specifically the Mugodzhar Hills and its eastern part, the Turgay-Gate – has always been of great significance with regard to transport routes. The region’s geopolitical importance is described by Halford Mackinder in his study as follows: „Through the Steppe on the other hand there came from the unknown recesses of Asia, by the gateway between the Ural mountains and the Caspian Sea, in all the centuries from the sixth to the sixteenth, a remarkable succession of Turanian nomadic peoples — Huns, Avars, Bulgarians, Magyars, Khazars, Patzinaks, Cumans, Mongols, Kalmuks. Under Attila the Huns established themselves in the midst of the Pusstas, in the uttermost Danubian outlier of the steppes.”vi In other words, this geographical gate-

Central Asia - The prominent stage of the "grand geopolitical game"

Central Asia or Central Eurasia - the prominent stage of the “grand geopolitical game” The Central Asian region is the central part of Eurasia;

The concept of the Hungarian Pavilion: The Tree of Life - Astana Expo 2017 (The Future Energy)

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The “heartland of heartlands”, that is, the very core of the 21st century’s Eurasian supercontinent, is without doubt Kazakhstan. As Nursultan Nazarbayev, Kazakhstan’s president put it, it is the “Heart of Eurasia”. The new capitol (from 1997) of the country, Astana (which means capitol in Kazakh) is aspiring to become the business/financial centre of the region. This is also ex-

Border crossing at Khorgos emplified by the fact that this year’s summer Astana hosted the EXPO 2017, the theme of which was future energy and renewable energy sources. Kazakhstan is the 9th largest country in the world and largest landlocked on the planet. Its geopolitical situation is excellent. In the north it shares borders with Russia (longest land border in the world with 7644 km), in the west it is bordered by the Caspian Sea (which is actually a lake, since it is an endorheic basin), its eastern neighbour is China, while in the south it borders Uzbekistan, Turkmenistan and Kyrgyzstan. Horgos/Khorgos located at the China-Kazakhstan border is the remotest geographical location from open sea in the Eurasian continent. In Halfrod Mackinder’s interpretation sea powers always subdue landbased powers, however, this “most land-based” location in the world might emerge as the “geopolitical winner” in the 21st century. This is because the biggest commercial road freight terminal of Western China is being constructed (and already partly in operation), within the framework of the Kazakhstan-China crossborder cooperation, between Khorgos and Horgos, on the Kazakh and Chinese sides of the border respectively. This terminal connects Western China with Central Asia and Europe, thus playing a major role in the commerce of Central Asia. This project is globally perceived to be the largest urban, and commercial and logistics hub construction project in the new Silk Road Economic Belt.

Kazakhstan is currently the 48th biggest national economy in the world (based on its total GNI – nearly 200 million USD). The record-scale boom of the Kazakh economy started in 2000 primarily thanks to the enormous increase in crude-oil production and export. The Karachaganak oil field located in the north-western part of the country is considered to be the largest in the world. In 2001, a pipeline, crossing the Caspian Sea, was opened in the second most promising oil field of the country, in Tengiz, thus considerably increasing export capacity. According to estimates, Kazakhstan possesses the 12th largest crude-oil and the 15th largest natural gas reserve in the world. Currently, the country is the 10th largest crude-oil and the 19th largest natural gas exporter on the planet. Crude-oil and natural gas products account for 60% of its entire export, and its biggest sales market is China. Its import comes primarily from Russia. Besides hydrocarbons the country has considerable uranium (estimates suggest that the world’s biggest uranium mine is in Kazakhstan), copper and zinc reserves. Precious metals make up 20% of its export. Thanks to the above, high-value working capital investments are pouring into the country (predominantly from China, Russia and the USA). The overall value of investments in 2015 amounted to nearly 120 million USD. January 31, 2017 President Nazarbayev announced the third stage of Kazakhstan’s modernisation, the five main pillars of which are the following: technological modernisation of the economy, technological development of traditional industries, further development of the country’s mining industry, complete restructuring of the agricultural sector and making it the leading sector of economy, joining the new Eurasian logistics infrastructure and the construction of its vital elements within the country. Taking all the above into account it can be stated the main objective of the country is to become one of the top 30 national economies in the world by 2050! East of the Mugodzhar Hills, enclosed by the Urals and the Caspian Sea, and the Caspian Lowland lies the Turan Depression. Its original geographical name was West Turkestan, after the Turkish speaking peoples that had lived here. From 1924 it was called Soviet Central Asia and then after the dissolution of the Soviet Union in 1991 it was named the Turan Depression. This region is part of the West Asian lowland characterised by ergs, clay deserts and huge salty lakes in its endorheic territories. The name Turan is of Persian origin,

Astana – The capital city of Kazakhstan

formerly used to denote the home of the peoples who lived north and east of ancient Persia. This is of outstanding significance, for The Hungarian Turan Society (also called The Hungarian Asiatic Society), in essence, can actually be considered as the historical antecedent of Hungary’s current Eastern Opening policy. The interpretation of the denomination Turan was always a subject of dispute while the Turan Society existed.ii Geographers used the term “Turan” in a purely geographic sense and were fierce opponents of imbuing the idea of Turanism with a scientifically utterly unsubstantiated linguistic, cultural or political interpretation. Pál Teleki wrote the following in the 1918 January-February issue of the society’s journal, Turán: “ Turan is a geographical concept to me, a type concept, the concept of the Central Asian Steppe with its agony under the vicissitudes of the fluctuating climate and its grapple with the desert...” Despite the endeavours of the most prominent figures in geography, Turanism eventually acquired a political charge, and its ideology became especially forceful in the wake of the 1920 Trianon peace dictate and promoted the “search for allies in the East after the treason of the West”. During the First World War with considerable government support – from May, 1916 – The Hungarian Turan Society was transformed into the Hungarian Centre for Eastern

Culture with the purpose of establishing a stronger relationship with peoples of the Turanian language family (with Turkey and Bulgaria in particular). The former Eastern Trade Academy which operated as an independent entity between 1899 and 1920 is of great importance with regard to Hungary’s current foreign trade strategy, the Eastern Opening. Students of the institution were specifically trained for promoting trade with countries in the Balkans and Anatolia. Trade conducted in these regions was supported by contemporary state policy by establishing trade offices in the prominent economic hubs. These offices also served as consulates in the respective states. Since the students of the Academy were granted considerable scholarhips, and could expect to build a serious career in foreign affairs/ trade after graduating the Academy, which admitted 25 people annually, was heavily oversubscribed. The most outstanding scholars of the era taught at the Academy, including, for example, Gyula Germanus who was the professor for Turkish and Arabic languages. Unfortunately the Eastern Trade Academy has sunk into oblivion by now, only a handful of documents dealing with its operation are accessible. In American geopolitics exerting political control over the Eurasian field of power has always been a pivotal element of exercising power globally. In the 20th cen-

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

tury, for example, in the work of Brzezinski the political concept of Eurasia crops up as the “Eurasian chessboard” and it sums up the geostrategic objectives of the US as regards Eurasia.v Brzezinski states the following in his book, “The Grand Chessboard”: “Hence, the issue of how a globally engaged America copes with the complex Eurasian power relationships – and particularly whether it prevents the emergence of a dominant and antagonistic Eurasian power – remains central to America's capacity to exercise global primacy.” In this book Brzezinski sees the following prospect as the one posing the greatest threat to America’s position of global supremacy: “Potentially, the most dangerous scenario would be a grand coalition of China, Russia, and perhaps Iran, an "antihegemonic" coalition united not by ideology but by complementary grievances.” In Brzezinski’s 2012 interpretation the two main pillars of the USA’s grand new geopolitical strategy is the “greater West” and the “new East”. The “greater West” refers to the USA’s primary objective of strengthening the West and along these lines recruiting Russia and Turkey as the USA’s allies. Though this interpretation from 2012 has already become irrelevant with regard to Russia. Brzezinski’s term, the “new East” encompasses China, East and Southeast Asia, and in his view these are the regions with which the U.S. should form a new comprehensive and balanced network of relationships. The “grand geopolitical chessboard” of the 21st century is going through fundamental changes, and owing to the evolving multi-polar world there are new “pieces” appearing on the board who will bring new rules to the game. Even though everything is in motion, the fundamental question remains the same: Will Halford Mackinder’s World Island ever take shape as an actual geographic territorial unit and will we be able to investigate global political relations in terms of the WorldIsland—American continent dichotomy in the near future ? Will the USA’s policy of containment continue, and if so, how will it actually thwart the creation of a strong economic and political relationship between Europe and Asia? Will a new Eurasian supercontinent be created through the ever-intensifying economic cooperation between Russia and China? What is the new multi-polar world going to be like and what will be the role of Hungary and the Central Eastern European region in the currently evolving Eurasian supercontinent?

4. R ussia and the geopolitical school of Neo-Eurasianism

The physical geography and borders of Russia

“In the past 20 years, our partners have been trying to convince Russia of their good intentions, their readiness to jointly develop strategic cooperation. However, at the same time they kept expanding NATO, extending the area under their military and political control ever closer to our borders. And when we rightfully asked: “Don’t you find it possible and necessary to discuss this with us?” they said: “No, this is none of your business. Those who continue insisting on their exclusivity strongly dislike Russia’s independent policy. The events in Ukraine prove this. They also prove that a model of relations full of double standards does not work with Russia.” Excerpt from V. Putin’s address at the conference of Russian ambassadors and permanent representatives on July 1, 2014. Since 2000 Eurasia has been a central element of Russia’s new geopolitics, for Neoeurasianism, that is, the creation of a new bipolar world order – i.e. Eurasianism vs Atlantism – , is of utmost importance in their efforts to obtain world supremacy. This Russian Eurasian geopolitical field is so decisive that V. Putin too made allusions to it in his speech at the presidential inauguration ceremony, May 7, 2012: “...our determination in developing our vast expanses from the Baltic to the Pacific, and on our ability to become a leader and centre of gravity for the whole of Eurasia.” The mastermind and the “leading figure” of Russia’s new geopolitics is Aleksandr Dugin, who in 2002 created his own party, the Eurasian Movement. Thus, Mackinder’s political term has become the ultimate “keyword” of Russia’s current geopolitical direction. Since Eurasianism has a long history in Russia, Dugin labelled the current Russian geopolitical direction as Neoeurasianism. Neoeurasianism is in stark contrast with Atlantism and the ultimate aim of Russian geopolitical endeavours is the creation of the multi-polar world! Dugin outlined the theory of Russia’s new geopolitics in his book titled the “Foundations of Geopolitics”.ii On the basis his work the most important features and objectives of Russian geopolitics are the following: Ø Instead of a unipolar system of world politics, controlled from the Atlantic field of power, the creation of a bipolar system of world politics is needed, and Eurasia must be re-established as a dominant centre of world politics;

Ø The champion of Eurasianism (or Neoeurasianism to be more specific) is Russia whose primary goal is the conclusion of Pan-Eurasian agreements with the leading powers of Asia (Japan, China, India) and the Asian member states of CIS; Ø Russia is not “merely” a state or a regional power but a world power the primary aim of which is the creation of a Russian Empire; Ø Establishing new types of economic relations with the states of the European continent (primarily with Germany and countries of East-Central Europe) is central to the creation of Russia’s economic sphere of interest. To date, the movement of Eurasianism has received a strong institutional basis in Russia. In January 1, 2015 Russia, Kazakhstan, Belarus and Armenia joined forces and established the Eurasian Economic Union. Kyrgyzstan became the fifth member of Eurasian integration in August, 2015. Geopolitically the main question concerning the creation of a new Eurasian field of power is whether Russia is going to be able to find allies in the future, and the most essential part of that question: what is the RussianChinese relation’s course of development going to be like? In this respect, arguably the most significant event was the meeting between the Russian and Chinese president in Moscow, May, 2015. On May 8, 2015 (a day before the Victory Day military parade commemorating the 70th anniversary of the end of WW II.), Russia and China officially signed the

deal on the Eurasian Economic Union and the New Silk Road Economic Belt cooperation.ii This is much more than a simply economic agreement because the deal outlines a common major investment and infrastructural development plans. What is the world like from Moscow? The Eurasia map attached demonstrates what major regions Eurasia can be divided into in accordance with Russian interests and geopolitical goals. The central area or in Mackinder’s terms the “Heartland” of the map is Russia, China, Central Asia and Mongolia. This central area is surrounded by four belts or geopolitically speaking “rimlands”. These rimlands are the following: Ø The zone consisting of Turkey, Iran, Afghanistan, Pakistan, and India; Ø Europe – from Western Europe to the Russian border; Ø Southeast Asia, South and East Asia – from the western border of Myanmar to Japan; Ø The Middle East – North Africa, the Arabian Peninsula, Syria, Lebanon, Jordan, Israel and Iraq. Therefore, China, Middle Asia and Mongolia are central to Russia’s geopolitical endeavours and to the new Russian Eurasian space in the 21st century. The question is what kind of allies Russia can find in the four “rimlands” and in what direction it can expand its economic and political influence.

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The main geopolitical regions of the Eurasian supercontinent from the perspective of Russian geopolitical strategies

The most important platform for the cooperation of Russia and China is the Shanghai Cooperation Organiztaion, founded in 2001. The founding members of the organisation also include the “Heartland-countries” of Central Asia, that is, Kazakhstan, Kyrgyzstan, Tajikistan, and Uzbekistan. In 2017 the political significance of SCO increased considerably, it expanded further as two other states, India and Pakistan, joined its ranks and became full members of the organisation. This is why Russian political analysts often call it the “G8”. The great questions for the near future are the following: when will Iran join the SCO and when will Turkey, currently a partner country of the organisation, become a full member? It is beyond dispute that the SCO can be regarded as the most important organisation of the evolving Eurasian supercontinent. The map shows the member states of the two main organisations of economic integration in the evolving Eurasian supercontinent – the Eurasian Economic Union and the Association of Southeast Asian Nations – ,

and those of the aforementioned Shanghai Cooperation Organization (SCO). It can be observed that only a handful of Asian countries have not joined either of the three organisations so far: Turkmenistan (which in the past had a contentious relationship with Russia due to the conflict around the gas pipeline construction, however, the parties have already started settling their differences); Nepal and Bhutan, North Korea, South Korea and Japan (which can be regarded as an American ally in the region). The idea of the Great Eurasian Partnership was conceived by V. Putin at the International Economic Forum in Saint Petersburg, July, 2016. The map exemplifies which already operating major organisations would serve as a basis for the planned new Eurasian cooperation. According to the Russian plans the Greater Eurasian Partnership could get under way in 2018 in the form of a multi-level integrational model; it is envisaged to come into being as a new type of international network.

Great Eurasian Partnership

5. 5. China’s “One Belt, One Road” initiative and the new Eurasian paradigm

As a side note it should be pointed out that in 2016 Russia was the 11th biggest national economy in the

But what does the world look like from Beijing? China’s ancient name is Chung kou which means “Middle Empire”. This, without doubt, refers to the fact that China has always considered itself to be centre of the world, and it still does today. In 2016 the USA produced 24% of the world’s total GNI, while China came in second with 15%. In the same year, among the world’s 500 biggest companies there were 132 American and already 109 Chinese corporations.

world (despite all the Western sanctions and low oil prices) but it produced only 2% of the world’s total GNI, and there were altogether four Russian companies in the world’s top 500. It follows clearly from all the above that the creation and shaping of the new Eurasian supercontinent is mainly contingent upon China’s endeavours. It can also be stated that Russia will never engage in a rivalry with China, it is in its interest to form an alliance with China, as strong as possible.

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The main routes of China’s “One Belt – One Road” development programme as of March, 2017

The most important factor in the creation of a 21st century Eurasian Supercontinent is, without question, China’s ambitious plan of constructing the New Silk Road Economic Belt – One Belt One Road. In 2013, in Astana, Kazakhstan (the “Heartland of Eurasia) Xi Jinping announced the trade and infrastructural development programme that would connect Eastern and Central Asia with Europe, thus making the Eurasia of the 21st century become reality. The three main routes of the New Silk Road Economic Belt on the land: 1. The route connecting China with Europe going through Central Asia and Russia; 2. The route connecting China with the Middle East going across Central Asia; 3. The route connecting China with South-east Asia (and the countries of the Indian Ocean). The two main sea routes of the New Silk Road Economic Belt: 1. The route connecting China with Europe through the South China Sea and the Indian Ocean; 2. The route connecting China with the southern region of the Indian Ocean through the South China Sea;

It can be stated geopolitically that the routes will allow the creation of a new Eurasian field of power in the 21st century. Moreover, the route will create unique, unprecedented opportunities for infrastructural development in the countries it crosses. Thus, Mackinder’s concept of the WorldIsland could actually become reality in the broadest sense, that is, the economic power field of the three continents (Europe, Asia, Africa) might be brought into life. This will raise the possibility of the USA losing ground in the World-Island and having its power gradually limited only to the American continent. There are six main areas of development connected to the 5 routes listed above. These rimlands are the following: 1. The so-called “New Eurasian Land Bridge” development area. The basis of this is the railway connecting Lianyungang in Jiangsu province beside the Yellow Sea and Alashankou, in Xinjiang province, Central China. This city is located in the vicinity of the Dzungarian Gate, the most important Kazakhstan-China border crossing which was already one of the main mountain passes used by nomad tribes

The six major development zones of China’s “One Belt – One Road” development programme

during the Migration period. The westernmost point of the development area is the port of Rotterdam in the Netherlands. As part of the “One Belt” programme China has taken under the construction of direct rail freight lines between Chongquing and Duisburg, Wuhan and the Czech Melnik and Pardubice, Chengdu and the Polish Lódz, and between Zhengzou and Hamburg. 2. The “China – Mongolia – Russia” development zone. The three states, located in the zone, signed the agreement in order to strengthen their trilateral cooperation in the near future at the conference of the Shanghai Cooperation Organisation in Dusanbe. According their plans they will renovate Russian railways in the area, and in addition to that, build the so-called “new Mongolian Steppe route” within the framework of their cooperation. 3. The “China – Central Asia – Western Asia” development zone. It will connect China with Turkey through the five Central Asian countries and Iran. Accordingly, China signed a cooperation agreement with the five Central Asian countries which dictates that these countries harmonize their strategies of national development with objectives of the New Silk Road development programme.

4. The “China –Indochina” development zone. China concluded a new cooperation agreement with five countries of the Indochinese Peninsula. This agreement and the “Greater Mekong Subregion Economic Cooperation” programme form an interconnected unit. Within the framework of these programmes the construction of several railway lines and highways was set forth. 5. The “China – Pakistan” development zone. Its main objective is to connect the Central Chinese Xinjang province with Gwadar port city in Pakistan through railways and highways. 6 The “Bangladesh – China – Myanmar” development zone. In May, 2013 China signed a mutual development deal with India, and subsequent to that in December, 2013 the deal was extended to include Bangladesh and Myanmar. The financial resources necessary for this enormous Asian infrastructural development (a development of such volume, comprising the whole continent is unique and unprecedented in the era of post-World War II world economy) are provided predominantly by the Asian Infrastructure Investment Bank (AIIB), which was proposed by China and was declared open for business in January, 2016. Currently it has 77 members; Hungary

Siberia

Europe Kirov

Moscow Hamburg Rotterdam / Antwerpen

Perm

Yekaterinburg Omsk

Novosibirsk

Lille / Brussels Paris

Cologne

Nuremb.

Salzburg Münich Salzburg

Northern Corridor

Krasnoyarsk Tayshet

Warsaw

Ulaanbaater Aktogay / Alataw Pass

Chop Budapest

Heihe

Irkutsk

Astana

Pardubice

Vienna

Skovorodino Chita

Minsk

Berlin

Kiev

London

Yakulsk

Manzhouli

Harbin

Central Corridor

Ürümqi

Samarkand

Istanbul

Tashkent Lop Nor

Khujand (Kokand)

Ankara

Antiochia

Rome

Damaskus Cairo

Teheran

Taxila

Balkh (Bactra)

Xian

China

Mashhad

Bagdhad

Shenyang / Fushun

Lanzhou

Holan (Kholan)

Yerevan Tabriz

Venice

Wuwei

Niya

Changchun

Bejing / Tianjin

Jlayuguan

Sofia

Vladivostok

Erenhot

Turpan

Belgrade Skopje

Tianshu / Guyvan

Lianyungang

Zhengzhou

Xuzhou Nanjing

Shanghai

Wuhan

Basra

East China Sea

Changsha / Zhuzhou

Mediterranean sea

Sevelskaya Gawan

Suifenhe

Saksaulkaya Alterau (New Sarai)

Khabarovsk

South Corridor Karachi

Arab Peninsula

Tamluk

Hanoi

Barygaza

Shenzhen / Hong Kong

Masulipatam

The sixth improvement was to announce and build the Silk Road, i.e. the One Belt, One Road initiative

South China Sea

Bengal Bay

Singarpore

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

Central and Eastern Europe from above

The Port of Piraeus as the European gate for the 21st-century New Maritime Silk Road

joined AIIB June 26, 2017. According to official reports of the bank, the number of members will reach 85 by the end of the year, that is, almost a half of the world’s nearly 200 nation-states will have joined this new infrastructure bank come end of 2018. From a geopolitical standpoint it is important to stress that the USA in not a member (the USA promotes the primacy of the World Bank in the field of international developments) and nor is Japan which sees the AIIB proposed by the Chinese as a rival of its self-established Asian Development Bank.

6. Central and Eastern European Countries on the “grand geopolitical chessboard” of the 21st century The state of Central and Eastern European countries on the “grand geopolitical chessboard” of the 21st century can be elucidated based on the following power matrix. I took Brzezinski’s 2012 interpretation, namely the “greater West” and the “new East” paradigm as a basis, as does the power matrix, however, I replaced the expression “new East” with the concept of “Eurasian

Geopolitical power matrix in respect of the Central and Eastern European region supercontinent”. The reason for this change is the fact that it is much more relevant for the Central and EastCentral European region. The present and future geopolitical situation of Central Eastern Europe is highly dependent on the prospective relationship of the Greater West and the Eurasian supercontinent. If the global political environment, which is currently constructed upon the American principle of containment and consequently on the Russophobia of the Atlantic field of power, remains unaltered then there will be very few opportunities for East-Central Europe and inherently Hungary to free themselves from being trapped between West and East. Based on the matrix the most important geopolitical questions of the near future with regard to Central and East-Central Europe are the following:

– Will the foreign policy strategy of the Trump administration change with respect to the East-Central European region and what kind of policy will NATO adopt with regard to the region? – What will the political future of the European Union be like? Or does the conflict of the EU’s nationstates foreshadow the creation of the so-called “Russo-German” Europe? – Will there be another “Eastern enlargement” in the EU? When can we expect the states of the Western Balkans (especially Serbia which is of paramount importance geopolitically) to join the EU? – How will Russia’s role change in the future and what will the Eurasian Economic Union-European Union relationship be like?

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

– What role will the East-Central European region play in the geo-economic strategy of China? Will the New Silk Road Economic Belt lead to the creation of the new Eurasian supercontinent, economically speaking? 7. C entral and Eastern Europe or East-Central Europe – the issues of denomination and geographical restriction and the problematics associated with the classification of the countries in the region The Central and Eastern European or in other words the East-Central European region has no clear-cut geographical borders; therefore, it is disputable whether such a region can be distinguished geographically within the European continent at all. On the other hand, the countries in the region are all characterised by three main physical geographic features, namely, their landlocked position, geographical conditions favourable for agricultural activities and the lack of energy carriers. However, even the denomination of the region raises some issues. In the news about world politics the region is usually called Central Eastern Europe which, following the logic of the Hungarian language, denotes the middle of Eastern Europe, so in physical geographical terms it is defined as the centre of the East European Plain. Consequently, the name is incorrect because we consider the region to be the eastern half of Central Europe, that is, East-Central Europe. The question of whether we can consider the Baltic region or the Balkan Peninsula as parts of Central Europe is another issue. Based on the definition used in physical geography, Central Europe, a European macro-region, stretches from the Rhine to the edge of the East European Plain in a west-east direction, while from north to south it extends from the North Sea to the roots of the South European peninsulas. The border of Central and Eastern Europe is the imaginary axis that can be drawn from the Bay of Gdansk to the ranges of the Eastern Carpathians. East of this line lies the East European Plain with its area of about 4.5 million km2 which is roughly half of the entire continent. Though, the fact remains that Central and Eastern Europe has no actual natural borders. The macro-regions of Central Europe include the Central European fold and thrust belt (the German, Polish and Baltic Plain and the German, Czech and Polish mid-mountains) the Alps, the Carpathians and the

Carpathian Basin. The Carpathian Basin covering about 330 thousand km2s is a very unique geographical region indeed, for it is the most homogeneous and most clearly definable landlocked macro-region in Europe. The Balkan Peninsula, already regarded as a part of Southern Europe, borders Central Europe at a 1200 km long stretch in the north, therefore it is difficult to differentiate from the Central European macro-region. But the Balkans is of paramount strategic significance, for it serves as bridge to Anatolia from which it is separated only by two narrow straits, the Dardanelles and the Bosporus. These two narrow straits have always possessed great importance throughout history, since the way out from the Black Sea to the Mediterranean leads through them. Despite the denomination and the geographical demarcation – or maybe exactly because of these – the area of Central and Eastern Europe is regarded as a historical region. The unique historical development of the countries in the region has already started in the 15-16th century when – owing to their geographical location – they were left out of the great geographical discoveries. The global trade’s centre of gravity shifted to the countries bordering the Atlantic Ocean and the countries located in the heart of the continent gradually became peripheral/semi-peripheral to world trade. In these countries the industrial revolution started only in the 19th century, much later than in the western half of the continent. The basis for the capital accumulation, necessary for industrialisation, was agricultural goods production which took advantage of the favourable physical geography of the region on the one hand, and the food export to western countries of the continent on the other. As a result of World War I. the borders of national states were fundamentally changed in the region. Austria-Hungary ceased to exist and several independent nation-states were formed in its place. The Second World War laid waste to the countries of the region. Subsequent to WW II. the region was set for a “unique” course of development. The victory of the Soviet Union also meant the expansion of its political sphere of interest to several countries over the globe. Due to the politically-based division of Europe after Wold War II. Albania, Bulgaria, Czechoslovakia, Yugoslavia, East Germany, Poland, Hungary and Romania were all forced to create a socio-economic system between 1945 and 1949 in which the Soviet Union’s model of socialism had to be taken over mandatorily. The most important present-day economic and social problems of Central and Eastern European countries

The countries of Central and Eastern Europe – 2017 Population million – 2017

GNI billion USD – 2016

GNI/capita billion – 2016

NATO year of accession

The EU and the Eurozone(€) year of accession

Czech Republic

10.7

186

17570

1999

2004

Poland

38.5

481

12680

1999

2004

Hungary

9.9

123

12570

1999

2004

Slovakia

5.4

16810

2004

2004 – € 2009

Estonia

1.3

17750

2004

2004 – € 2011

Latvia

1.9

14630

2004

2004 – € 2014

Lithuania

2.8

14770

2004

2004 – € 2015

3.0

4250

2009

Visegrad Group

Baltic states

Southern European states Albania Bulgaria

7.1

7470

2004

2007

Romania

21.5

187

9470

2004

2007

2009

2013

States of the former Yugoslavia Bosnia and Herzegovina

3.9

4880

Croatia

4.3

12110

Macedonia

2.1

4980

Kosovo

1.9

3850

Montenegro

0.6

6970

Serbia

7.1

5280

Slovenia

2.0

21660

5600

2017 2004

2004 – € 2007

Former Soviet states of the European continent Belorussia

9.6

Moldova

3.5

2120

Ukraine

44.0

2310

A table created by the author based on data acquired from World Bank World Development Indicators originate from the change of regimes that started in 1989-90. The most crucial issue of this era is the accession to the European Union which can be interpreted as the manifestation of belonging to a reunified European continent after the fall of what was considered to be the symbol of Cold War, the Iron Curtain. Based on their geographical location, history, events of the 1990s and their belonging to the Atlantic field of power the 20 countries of the region can be classified in the following manner. But is the traditional classification applied in the table above still valid today? Is belonging to the Euro-Atlantic field of power still the most important criteria of

classification? What kind of sub-regions can the countries be grouped into based on their geography, history and geopolitical situation? And the most important question is what future role the 20 Central and Eastern European countries will play in the evolving multi-polar world of the 21st century? The classification of the 20 countries in the table as Central and Eastern European is somewhat similar to the so-called “16+1” cooperation between China and 16 Central and Eastern European countries. In 2011 during his official visit in Hungary Wen Jiabao, former president of the People’s Republic of China, announced plans for creating a new platform for establishing more

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The imports of Central and Eastern European countries from China and Hong Kong as a percentage of GDP for the countries, 2016

lationship with the countries involved and to further expand the cooperation to the fields of science, technology, education and culture. China’s ultimate goal, however, is to improve its cooperation with the countries in the region to help implement its ambitious “One Belt – One Road” programme for the 21st century

GDP per capita (PPP) of the EU NUTS2 regions in 2015 as a percentage of the average regional economic development for the EU-28 intense economic relations with Central and Eastern European countries and with the region itself as a whole. Based on the Chinese definition of the EastCentral European region the countries belonging to this group are the ones “trapped” between the Western European and Russian spheres of interest. Thus, Belarus, Moldova and Ukraine are excluded from the 20 examined countries based on the Chinese definition of 16

Central and Eastern European countries. Furthermore, the Chinese efforts for promoting peace and avoiding conflicts did not allow the inclusion of Kosovo either. The “16+1” transregional platform was officially brought into life in 2012 at the Warsaw summit and since then a Prime Ministerial summit has been organised annually by the 16 CEE countries and China. The main goal of China is to strengthen its economic re-

the aim of which is establishing a new Eurasian field of power. It is imperative to point out that for China it would also entail strengthening relationships with the entire region and not with the individual countries. Nevertheless, it is still unclear to what extent the Chinese “16+1” formation will contribute to the creation of a new Central and Eastern European field of power in the 21st century. In November, 2013 at the Bucharest summit the countries agreed on elaborating a medium-term programme for the “16+1 cooperation”. In December, 2014 at the Belgrade summit the members decided to adopt the directives of the “EU-China 2020 strategic agenda for cooperation” and EU-law as the basis of the “16+1” cooperation. This was the date when the agreement on renovating the Budapest-Belgrade rail-

way line, the first large-scale infrastructural project of the “16+1 cooperation”, was signed. Furthermore, the parties agreed on the creation of sectoral coordination centres: the China-CEEC Tourism Promotion Agency in Budapest and the China-CEEC Investment Promotion Agency in Warsaw and Beijing. At the Suzhou summit in November, 2015 the institutional framework of the “16+1 cooperation” was solidified definitively. In order to strengthen their economic cooperation the parties agreed to improve the railway link – taking the transportation of goods between Lodz and Chengdu as an example – between the two regions. The customs clearance facilitation cooperation mechanism between Greece, Macedonia, Serbia and Hungary came into force in order to promote the seamless transportation of goods from the port of Piraeus to the EU (China-Europe Land-Sea Express Line). The parties showed support for the plan ensuring the cooperation between Adriatic, Baltic and Black Sea ports and their accompanying industrial parks, and the connection of these ports with economic corridors (Adriatic-Baltic-Black Sea Seaport

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

Countries of the "16+1 Cooperation"

Leaders of China and the 16 Central and Eastern European countries at the Summit of the "16+1 Cooperation" in 2016

Hungarian Prime Minister Viktor Orbán at the 16+1 Summit

Cooperation). The most important achievement of the Riga summit that took place in November, 2016 was the foundation of the China-CEEC Investment Cooperation Fund. The parties agreed that they would harmonize their infrastructural developments with the routes of the Trans-European Transport Network. The China-CEEC Secretariat on Logistics Cooperation was established in Riga and it has its own virtual platform too(www.ceec-china-logistics.org). The parties support the second large-scale infrastructural project of the mechanism which is the modernisation of the Budapest-Belgrade railway line. In November 2017, the summit of the “16+1 cooperation” took place in Budapest. At the final press conference (November 27, 2017) Viktor Orbán evaluated the summit as follows:

„We confirmed the recognition that a new world order is taking shape around us – both politically and economically. In this new world order the role of Asia and China has increased significantly, and will continue to increase in the future. Asia and China have also become a determining factor in terms of finance and technology. Central Europe welcomes this development. In our view, the strengthening of the Chinese economy also offers great opportunities to the countries of Central Europe. Unfolding before us are the signs of a success story: the success story of cooperation between the countries of Central Europe and China. There is enormous growth potential in the Central European region. You can see this potential if you study the Central European region’s economic growth figures. In this cooperation system, eleven of us are Member States of the European Union, while five of us are not yet members. In

terms of the future, the key question is whether we can involve the Central European countries in the European Union and the other five countries aspiring to become members in overarching long-term economic projects, investments and developments which will lead to the rise of the entire region. In order for this region to be able to grow, we need external resources in terms of technology and financing. Existing European resources

are no longer sufficient on their own. We therefore welcome the fact that, as part of the new economic world order, China wishes to be present in the growth and development of this region. We have reviewed the most important projects in which this cooperation manifests itself. From among these, I should mention the modernisation and development of the Belgrade–Budapest railway line. This is a flagship project with future strate-

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

gic significance for freight traffic along the Silk Road within the One Belt One Road Initiative. Today we had the opportunity to hear about projects and development plans which will create “win-win” situations: situations in which every participating party will be a winner. What we have achieved today is beneficial for China, beneficial for the European Union, and also beneficial for the countries of Central Europe.”

Countries of the Visegrad (V4) Cooperation

But the great question for the years to come is whether the V4 will expand or not? Will other countries be involved from the region? From a geopolitical standpoint the expansion of the Visegrad Group is indeed by all means justified because in order for the Central and Eastern European countries, currently divided by great powers, to form a new and strong region both politically and economically, they will have to acquire signifi-

Concerning the classification of the 20 countries included in the table, it is apparent that there is only one group not based on geographical location or shared history. This is the Visegrad Group which was established to promote political cooperation after the regime changes in the 1990s. In Visegrad, February 15, 1991 – following the example of the meeting between the Polish, Czech and Hungarian rulers back in 1335 in Visegrad – Václav Havel, the president of Czechoslovakia, József Antall, Hungarian prime minister and Lech Wałęsa, president of Poland signed the Visegrad Declaration. By signing the declaration the leaders of the three countries (now there are four member states due to the 1993 dissolution of Czechoslovakia) stated that they would closely cooperate on their way towards European integration. Since then the V4 has become a recognised political “trademark” or in marketing terms a “brand” and in the international literature and diplomacy these countries are now called the Visegrad Four. The V4 countries have already achieved their goals set in the 1990s and joined the EU in 2004, moreover the Czech Republic, Poland and Hungary became member states of NATO in 1999 while Slovakia joined the military organisation in 2004. One of the biggest achievements of the Visegrad Group is that in 2000 the International Visegrad Fund was established in Bratislava. The main objective of the Fund is to promote the cooperation of V4 countries in the field of education, science and culture. What is more, nowadays the Fund supports programmes intended to strengthen the relationship of V4 countries with the neighbouring states. The main goals of V4 countries coming into the 2000s were the preservation of Central European countries’ identities and the assertion of their common interests. The migrant crisis peaking in 2015 only strengthened the capacity of V4 countries to assert their interests both within and outside the EU. But of course, this is connected to the EU’s political crisis (will the EU ever become a strong political union or will national sov-

ereignty still serve as its foundation in the near future; what kind of solutions can European integration offer for the migrant crisis and how great is the opposition of the individual nation-states in this regard). Nowadays the opposition of the V4 countries within the EU is most apparent in the issues of the mandatory migrant resettlement quotas and the interpretational differences between the EU and Central European countries concerning the model of democracy. Though in this regard there is a discrepancy between the Polish and Hungarian interpretation and the Czech and Slovakian standpoint. The period of the 2016/2017 Polish V4 presidency was the first time during which the Visegrad Group set very serious political goals: intensifying the economic and political cooperation of V4 member states with other countries of the Central European region and with countries of the Western Balkans and those involved in the EU’s Eastern Partnership Programme (primarily Belorussia, Moldova and Ukraine). The current Hungarian presidency programme carries on the foreign political endeavours of the Polish presidency. The prime goal of the Hungarian presidency subprogramme, called “Regional Visegrad”, is also the strengthening of relationships between the countries of the V4 and Western Balkans. Furthermore, it aims to increase the role of the V4 in elaborating and substantiating the EU’s policy on further expansion through the strengthening relationship with the countries of the Eastern Partnership.

cantly more dominance and strength. The 2017 Czech and Austrian general elections do fall in line with these efforts. According to my prognosis for the future the V4 group ought to be transformed into a V7 partnership. Croatia, Slovenia and Austria should be added to the cooperation, and consequently, a new framework of 21st century Central European cooperation should be

The headline target of the Trans-European Transport Networks (TEN-T) is to interconnect the road transport infrastructures, to establish high-speed rail networks on the whole European continent and to standardise air transport and air traffic management systems. The EU’s 1996 and 2001 transport development plans for creating trans-European networks attached particular priority to the establishment of seaports, inland ports and intermodal terminals. Later, the 2013 Review of the EU integrated the TEN-T network structures with approximately thirty related priority projects and it also identified nine TEN-T Core Network Corridors. The EU set 2030 as the target date for the implementation of the projects relating to the creation of core networks. The following map illustrates these nine Core Network Corridors of the EU: Five out of the nine Core Network Corridors pass across or touch the border of the Central and Eastern European region.

established. 8. The EU’s five TEN-T (Trans-European Transport Networks) Core Network Corridors passing through the Central and Eastern European region and their organisational impact on economic space, with special regard to the Chinese „gates” of the region In accordance with the Maastricht Treaty of 1992, the European Union has created Trans-European networks (TEN) in the areas of transport, telecommunications and energy, and has started to develop these specific networks in order to promote the functioning of the internal market, to contribute to the establishment of economic and social cohesion and to ensure the interconnection between the EU’s central areas and the peripheral regions. The latter are landlocked regions, or regions which do not have any islands. All this means that the aim of the TEN concept is to connect the existing national and regional networks, to build up the missing sections and to remove the bottlenecks between the national networks, as a result of which networks could be created encompassing the whole European integration, or, in broader sense, the whole European continent. A further objective of the TEN programmes is to extend EU networks to Central and Eastern Europe and to the Mediterranean countries.

Three of these corridors are West-East corridors, which are the following: Ø the Rhine-Danube corridor; Ø the Mediterranean corridor and Ø the North Sea-Baltic corridor. There are also two North-South TEN-T corridors; these are the following: Ø the Baltic-Adriatic corridor and Ø the Orient/East Med corridor. From the perspective of the Central and Eastern European countries, usually two critical remarks are made on the TEN-T transport corridors. Firstly, they are dominated by the networks determined in the West and the aim is merely to supplement and extend these networks to Central and Eastern Europe. Therefore, the establishment of transport networks within the Central and Eastern European region is not regarded as a priority. Secondly, the existing funding conditions (individual project financeability) enable the consolidation of formerly established networks exclusively and there is little prospect that new structures will be built or established. For the Central and Eastern European region it means that since it is the eastward extension of the TEN-T West-East corridors that prevails in the EU transport directives, these TEN-T networks contribute only partially to the creation of a 21st cen-

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

TEN-T Core Network Corridors of the EU

tury North-West economic field of power in Central and Eastern Europe. In other words, the current TEN-T network structure does not take into consideration the aspects of the enlarged EU’s spatial organisation. Instead, it reinforces the central role of the Western European “core region”. However, the enlargement of the EU is not the only reason why the 21st century transformation of the TEN-T corridors has become a key issue. It is important for China’s Silk Road Economic Belt, too. The main question is to what extent can the EU transport corridors which traditionally focus on Western Europe be transformed in such a way that they fit the transport network of the emerging Eurasian field of power; that is, in such a way that a new single Eurasian transport network is created, including the land and maritime routes of China’s Silk Road Economic Belt. In this case, the task would be to find the place where the EU TEN-T corridors could be connected to the two Chinese routes, that is, the land route (passing through Central Asia and Russia) and the

maritime route (across the South China Sea and the Indian Ocean) connecting China with Europe. However, the idea that the EU could be seen as a part of the Eurasian field of power has not been included among the EU’s official resolutions yet. Moreover, for the time being, the EU’s official leaders and opinion formers reject the concept of Eurasia itself as well. Nevertheless, considering the Central and Eastern European region to be a part of the Eurasian field of power is of paramount importance for us, as it is the only way to break free from the “captivity” of the West and the East and to become a bridge region in the 21st century. In the case of the EU, the fact that there is an increasing number of EU development programmes in which the candidate countries for EU accession are also included can be regarded as a step forward. As regards the Central and Eastern European field of power, the EU’s so-called macro-regional strategy is of outstanding importance. The concept of macro-region has no uniform definition. It can be

The five TEN-T Core Network Corridors in the Central and Eastern European region

used to describe country groups of international importance (such as the EU, APEC and the Eurasian Economic Union), specific countries or it can also refer to regions within a specific country which belong to a particular large area. According to the EU definition, given in 2009 when the EU Strategy for the Baltic Sea Region was adopted, the concept of macro-region refers to territorial units encompassing those regions of various countries which display common cohesive features and have special mutual political, economic and cultural relations. After the adoption of the EU Strategy for the Baltic Sea Region, the EU devised three further macro-regional strategies: the EU Strategy for the Danube Region (2011), the EU Strategy for the Adriatic and Ionian Region (2014) and the EU Strategy for the Alpine Region (2016). The macro-regional strategies involving 19 EU and 8 non-EU countries have become an integral part of the EU policy framework. The objectives of the strategies are entirely consistent with the EU’s political priorities; they reinforce the various EU policies and are built on the framework of cohesion

policy. Macro-regional strategies enhance the value of the cooperation dimension within the cohesion policy. They provide space for multi-sectoral, multicountry and multi-level governance even for nonEU Member States. They can play a significant role in the mitigation of the potential adverse effects at the EU’s external borders and in promoting the reinforcement of relations between these countries and the EU. The basis of the EU macro-regional cooperation comprises a number of points. These are the following: Ø Macro-regions are large gravitational regions based on real internal relation systems; Ø The basic prerequisite for the cooperation is commitment at national and regional level; Ø It is characterised by a participatory process and multi-level governance efforts; Ø Within the framework of cooperation, specific activities are carried out, which are implemented as common projects; Ø The implementation of macro-regional strategies is carried out by creating coherence with the existing EU legislation and policies.

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

Macro-regions of the European Union

The EU’s fundamental principle adopted for macroregions is based on the principle of the ‘three NOs’, according to which: Ø The strategy provides no new EU funds. There could be additional international, national, regional or private funds, although the emphasis is on the better use of existing funds; Ø The strategy requires no changes to EU legislation; Ø The strategy does not establish new structures; it is implemented by existing bodies, whose complementarity must be maximised.

The Rhine-Danube (TEN-T) Core Network Corridor

Macro-regions can also be interpreted as the joint development of areas based on geographical location and geographical features. From a geopolitical point of view, the question is the following: to what extent can macro-regional development strategies exceed the different historical developmental paths of countries and areas belonging to macro-regions and whether these strategies are able to soften or change the Cold War rhetoric, which is based on the West-East division. However, it is undisputed that the EU’s macro-regional strategy leaves room for the 21st century spatial reorganisation of the Central and Eastern European region, which will be based on economic cohesion and not on political divisions. In the following section, we analyse those five major Core Network Corridors of the EU which pass across the Central and Eastern European region. The analysis focuses on the potential new economic spatial organisational forms this region might or will take due to the impact of the corridors. The Rhine-Danube corridor The Rhine-Danube corridor is the most significant WestEast transport corridor of continental Europe. Following the route of the Danube, it runs from Strasbourg through Southwest and Southeast Germany towards Central European cities. It connects Vienna, Bratislava and Budapest with Bucharest and the easternmost point of the corridor is in Constanta, at the most important Black Sea port of Romania. The second, northern branch of the corridor links Frankfurt, Prague, Žilina and Košice and its easternmost point can be found at the Slovakia-Ukraine border. The main issue of this transport corridor’s future development is to further develop transport routes which connect Germany with Central and Eastern European countries. The basis of this main transport route is the Rhine-MainDanube waterway (Europa Canal), where vessels can sail from Rotterdam, located at the North Sea, to Constanta,

located at the Black Sea. This trans-European waterway is the longest inland waterway in the world, which is 3 434 km long. Together with its river stretches, the length of this waterway system is 12 000 km. The establishment of this waterway system required substantial water engineering work on the originally non-navigable sections of the Danube and the Rhine. Furthermore, between the Main and the Danube, a navigable canal has been built. This 171 km long waterway connects the Main with the Danube from the Bavarian Bamberg to Kelkheim. The canal was completed in 1992 and the plan was to construct 29 dams on the Rhine-Main-Danube waterway, out of which 14 have already been built. These dams create a 607 km section meeting the waterway parameters, thus enabling undisturbed navigation.i The fact, that the EU adopted the Strategy for the Danube Region in 2011, which is the second macro-regional strategy of the EU, contributes significantly to the development of this transport corridor. This strategy is the macro-regional development strategy and action plan of the countries and regions of the Danube River Basin. The strategy was developed by eight EU Member States: Austria, Bulgaria, the Czech Republic, Hungary, Germany (Baden-Württemberg and Bavaria), Romania, Slovakia, Slovenia, and six non-EU countries: Croatia (which was not yet a Member State), Serbia, Bosnia and Herzegovina, Montenegro, Moldova and Ukraine. As, with the exception of Austria and Germany, the countries participating in the strategy for the Danube region are countries which acceded to the European

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The territory of the EU Macro-regional Strategy for the Danube Region

Union through the enlargement policy of the EU (2004, 2007 – eastern enlargement; 2013 – Croatia) or Western Balkan countries involved in accession negotiations or Eastern Partnership countries; this macro-regional strategy is also regarded as the symbol of the new, enlarged EU. From the aspect of economic partnerships, it can be considered to be the growth axis of Central and South-East Europe. The map above demonstrates the macro-regions of the Danube. Based on this map, we can conclude that this area can be regarded as a significant sub-region of the Central and Eastern European region. This sub-region is based on physical geographic features and goes beyond the political approach which focuses on distinguishing countries that are members of the Euro-Atlantic field of power and non-member countries. The Rhine-Danube Core Network Corridor and the Danube region are of paramount strategic importance for Hungary, as, due to its geographical situation, its history and its current EU-membership, half of the export of goods are carried out within the framework of this transport corridor. The reason for that is that traditionally, the Danube is the most vital physical geographic link between the West and the East of Europe. As the map below outlines, there are four destinations (countries of the Danube) which contribute to the fact that the value of Hungary’s merchandise exports exceeds 5 million USD. These priority destinations are the following: Germany (value of all merchandise exports: 28.9 billion USD, accounting for 28.1% of Hungary’s total volume of merchandise exports), Romania (value of all merchan-

dise exports: 5.3 billion USD, accounting for 5.2% of Hungary’s total volume of merchandise exports), Slovakia (value of all merchandise exports: 5.12 billion USD, accounting for 5.02% of Hungary’s total volume of merchandise exports) and Austria (value of all merchandise exports: 5.1 billion USD, accounting for 5.0% of Hungary’s total volume of merchandise exports).

The main destinations of Hungary’s merchandise exports in 2016 and the offices of the Hungarian National Trading House in 2017

The planned Hyperloop route for the 2020s connecting Vienna, Bratislava, Budapest and Košice

This most important West-East transport corridor of the European continent is ahead of an outstanding technical development, since the first European ‘Hyperloop’ train line is planned to connect Vienna, Bratislava, Budapest and Košice. Hyperloop is a vacuum tube train, which is planned to reach supersonic speeds (1220 km/h). In March 2016, the CEO of the Hyperloop Transportation Technologies (HTT) signed an agreement with the Slovak Minister of Economy to build the Hyperloop transport line connecting the four cities by 2020. As the map below demonstrates, the transport time between these cities would become significantly shorter, as a Bratislava-to-Vienna route would take only 8 minutes and a Bratislava-to-Budapest journey only 10 minutes. This new, today still almost incomprehensible mode of transport will establish a direct link between the large cities of the region and might create new spatial organisational forms, as well as spatial connections. Obviously, there are a lot of people who are sceptical about this revolutionary new technology. However, it is beyond doubt that this Hyperloop technology would practically eliminate geographical distance. This is particularly important, as the Central

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

and Eastern European economic field of power has two major growth axes: the Vienna-Bratislava economic axis and the Warsaw-Berlin growth axis (where the Polish government also plans to construct a Hyperloop railway). The latter will be discussed later. The Mediterranean corridor The Mediterranean (TEN-T) Core Network Corridor

The approximately 3000 km long Mediterranean transport corridor is the second most important West-East axis of the EU’s TEN-T networks. It connects the southwestern Mediterranean region with the Hungary-Ukraine border. It runs from the southernmost point of Spain, the Strait of Gibraltar, along the coastlines of Spain and France, crossing the Alps it goes through the northern part of Italy and continuing through Slovenia and Croatia it enters the territory of Hungary. The easternmost point of this Mediterranean corridor is Záhony, at the Hungary-Ukraine border. The Mediterranean corridor is significant also because it connects the western Mediterranean region with the EU’s core region. In Spain this transport corridor has not only a coastal route, but also

another one, which connects Madrid with the coastal areas. The 621 km long high-speed railway line (designed for speeds above 300 km/h) connecting Madrid and Barcelona was opened in 2008. Formerly, a Madridto-Barcelona route took five hours; today, however, the same route takes only two and a half hours, thanks to this high-speed railway. There is a high-speed rail line in France as well, which connects Marseille and Lyon. One of the largest investments of the Mediterranean transport corridor is the construction of a new railway line between Lyon and the Italian city, Torino. A key part of this investment is the construction of a new, 57 km long tunnel through the Alps. This new railway line, which would be a new border crossing, is expected to be ready by 2028. The modernisation of the railway networks in those areas of Slovenia, Croatia and Hungary where the Mediterranean corridor crosses the countries is only a long-term plan of the EU. The EU Strategy for the Alpine Region, adopted in 2016, is related to the Mediterranean corridor. However, this strategy concerns only Slovenia out of the 20 Central and Eastern European countries. The Alpine region is one of the richest regions in the world. Moreover, thanks to its unique geographical and natural features, it is one of the most economically dynamic, innovative and competitive regions of Europe. The strategy concerns about 80 million people and 48 regions in the seven countries of the Alpine macro-region. Five out of these seven countries are EU Member States (Austria, France, Germany, Italy and Slovenia) and two countries are not members of the EU (Liechtenstein and Switzerland). The reason why this transport core network corridor is of major importance for Hungary is that Záhony, located at the Hungary-Ukraine border, is the eastern gate of the EU and also one of the western gates of the New Silk Road Economic Belt’s New Eurasian Land

The territory of the EU Macro-regional Strategy for the Alpine Region

Bridge development zone. Thus, Záhony can be regarded as one of the key strategic geographical locations of the new Eurasian field of power. Záhony is an important station of the East-West rail transports, which is the junction of the European “standard gauge” and the eastern broad gauge railway networks. Transhipping, made necessary by the 89 mm difference in gauge between the two systems, has been going on since 1948, that is, for over 60 years. The land transhipping complex, often referred to as the eastern gateway to Hungary, has a total area of 84 km2. With its 260 km long standard gauge railway lines and its 140 km long broad gauge railway lines, it can be regarded as a large-size complex with large transhipping capacity also at European level. Its principal activity is transhipping cargo arriving from the Commonwealth of Independent States and countries beyond via Ukraine’s Csop (Záhony) and Batyevo (Eperjeske) border crossing points in cars on broad gauge (1520 mm) railway into standard (1435 mm) gauge cars. Now, however, Záhony may be granted a new role through China’s New Silk Road economic project, as, in the near future, one of the major routes of the transport of goods between China and the European continent will pass through Záhony. Thus, Záhony can become the logistics hub of Chinese goods. In accordance with the agreement, concluded in November 2017, to develop the Chinese-Hungarian logistics cooperation; in the near future, a certain part of the flow of goods coming from China into the EU will be transported into Hungary, and the goods will be distributed to the Central and Eastern European region from this country. In order to attract Chinese railway container traffic to Hungary, the Ministry for National Economy of the Hungarian Government designated an area of more than 17 000 square metres, in the free enterprise zone of Záhony, as a customs free zone. Currently, this is the only customs free zone in Hungary, which can make the region an attractive industrial location again and plays a pivotal role in making the Záhony region an international freight and logistics hub. From the aspect of import duties, taxes and import measures of the commercial policy; goods within the customs free zone are to be regarded as goods outside the customs territory of the EU. Therefore, in such zones any kind of industrial, commercial or service activity is permitted, under the conditions laid down by customs legislation. This means that businesses are allowed to carry out activities involving the storing, processing, selling or the purchase of goods. If a certain investment is carried out in a customs free zone, there are no duties or national taxes payable on goods

imported from abroad; thus, the costs of economic activities planned to be carried out in an industrial area are lower. Furthermore, capital allowances can also be ensured, because the imported means of production are also exempt from duties and taxes. However, the key to Záhony’s genuine future development would be to establish a direct railway link between Záhony and Horgos/Khorgos, located at the China-Kazakhstan border. Currently, this China-Kazakhstan Border Cooperation is globally regarded as the biggest largest urban, and commercial and logistics hub construction project in the new Silk Road Economic Belt. Khorgos, located on the Kazakhstan side and Horgos, located on the Chinese side of the border, constitute the largest commercial road freight terminal of Western China.This terminal connects Western China with Central Asia and Europe, thus playing a major role in the commerce of Central Asia. In Horgos, a Border Cooperation Centre is being built, which is suitable for trade negotiations, presentations of goods, carrying out sales and transportations and organising various regional or international economic and commercial conferences. The prevailing trade policy of the region is a favourable bilateral trade policy; the citizens of China, Kazakhstan and other countries can stay for 30 days in the centre without a visa, together with their commodities and cars. The North Sea-Baltic corridor The North Sea-Baltic (TEN-T) Core Network Corridor

The EU’s North Sea-Baltic transport corridor runs from Helsinki, connects the ports and the most important cities of the three Baltic States, and following the traditional West-East corridor, it passes through Warsaw,

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The planned route of Hyperloop in Poland connecting Warsaw, Lodz and Wroclaw and a picture depicting what the Polish Hyperloop is planned to look like

Lodz, Poznan and Berlin, continuing towards the major ports of the North Sea, that is, towards Hamburg, Bremen, Amsterdam and Rotterdam. Thus, it connects the most important ports of the European continent with Poland and the Baltic States. The entire transport corridor consists of 5 947 km of railways, 4029 km of roads and 2186 km of inland waterways. One of the corridor’s most important projects is the construction of a new, high-speed railway, running from Tallinn (Estonia) towards the Lithuania-Poland border, continuing to the Polish city, Bialystok. The plan is to extend this railway line to Warsaw. Since this transport corridor ensures a link between Eastern Europe and the busiest ports of Western Europe, it is of key importance for the New Silk Road Economic Belt, more precisely for its development zone, called New Eurasian Land Bridge. At the BelarusPoland border, opposite the Belarussian city of Brest, in the Polish city of Terespol; a logistics hub, that is, basically a new city is being built with Chinese capital investment exclusively. The Polish city of Terespol is often referred to as one of the major cities of the New Silk Road already today. In the near future, it will be one of the main directions of the Chinese flows of goods. However, Terespol’s importance can be definitely connected to Brest’s transhipment complex on the opposite side. Similarly to Záhony, Brest is also a transhipment station where the broad gauge railway, built in the Soviet era, meets the European standard gauge railway line. From the aspect of transport geography,

Brest has an excellent location, as it is located on the main railway line connecting Moscow and Minsk. Furthermore, in the Soviet era, a highway was also built between the two cities. As already mentioned above, the second Hyperloop railway line within the Central and Eastern European region is planned to be constructed in Poland, on the Warsaw-Lodz-Wroclaw route. It would connect the capital of Poland, Warsaw, with the manufacturing and technology centre, Wroclaw, over a of 415 km stretch. While a “traditional” journey from Warsaw to Wroclaw takes 3.5 hours, thanks to the Hyperloop railway, it will only take 40 minutes in the future. The first section of the Hyperloop route in Poland is planned to be built between Warsaw and Lodz, as Lodz is a major European logistics hub of the Chinese New Silk Road Belt. The Polish gate of the New Silk Road’s land route is the city of Terespol, opposite the Belarussian city of Brest. According to the plan, a new railway line is to be built between Terespol and Warsaw, there should be a Hyperloop railway line connecting Warsaw and Lodz, and the North Sea-Baltic TEN-T corridor runs from Lodz, through Poznan right up to Berlin. The implementation of this plan would be extremely significant, as one of the most important growth axes of the Central European region is the Warsaw-Berlin axis. Another plan of the company Hyper Poland is to construct a Hyperloop railway line connecting Warsaw with Krakow. This line would be of particular impor-

tance for the other Visegrad countries and would significantly contribute to the establishment of a new Visegrad economic field of power.i The company Hyperloop One plans to construct two new railway lines in Europe which are closely connected to the North Sea-Baltic TEN-T corridor, as well as the Central and Eastern European field of power. The first one would connect Helsinki with Tallinn over a length of 90 km. This journey would only take eight minutes. The second plan is to construct a 1991 km ring line in Germany on the Munich-Berlin-HamburgFrankfurt-Stuttgart-Munich route. This transport corridor is closely connected to the EU Strategy for the Baltic Sea region which was first adopt-

The major aim of the Macro-regional Strategy for the Baltic Sea Region is to develop the whole region around the Baltic Sea into a leading region at a global level. This strategy is based on four fundamental pillars: 1. To make the Baltic Sea Region environmentally sustainable. 2. To make the region prosperous (through the more effective coordination of research and innovation and the EU laws). 3. To make the region accessible and attractive (by improving the transport systems and energy supplies, which is a great challenge, in view of the low population density and the peripheral nature of certain parts of the Baltic Sea Region).

ed by the European Council in 2009. Thus, this region can be regarded as the “flagship” of the EU’s macro-regions. As the figure below demonstrates, the Baltic Sea macro-region consists of 11 countries, eight EU Member States: Denmark, Estonia, Finland, Germany (the States/Länder of Berlin, Brandenburg, Bremen, Hamburg, Mecklenburg-Vorpommern, Schleswig-Holstein and Lower Saxony - only the NUTS II region of the Lüneburg region), Latvia, Lithuania, Poland and Sweden, and three non-EU countries: Belarus, Norway and Russia (St. Petersburg, Arkhangelsk Oblast, Vologda Oblast, Kaliningrad Oblast, Republic of Karelia, Komi Republic, Leningrad Oblast, Murmansk Oblast, Nenetsky Autonomous Okrug, Novgorod Oblast and Pskov Oblast).

4. To make the region secure (through the more effective joint surveillance of shipping, public health, crisis management etc.).

The territory of the EU Macro-regional Strategy for the Baltic Sea Region

The fact that Russia and Belarus are also partner countries, increases the geopolitical importance of the Baltic Sea macro-region significantly. The Baltic region is of key importance for Russia because of the Nord Stream pipelines of Gazprom. The reason why the Nord Stream pipeline of Gazprom is significant is that it brings gas under the Baltic Sea directly to Germany, without passing through Ukraine. Germany is the biggest purchaser of Gazprom’s gas and this pipeline reveals how excellent the economic relations between Russia and Germany are today, which have been improving since the 2000s. From a geopolitical point of view, it can be regarded as the new, 21st century Russian-German economic axis. The Nord Stream 1 pipeline was inaugurated on 8 November 2011, which transports natural gas from the city of Vyborg, located at the Finnish-Russian border, to Greifswald in Germany. The Nord Stream company is a joint venture whose majority shareholder is Gazprom, holding a 51 percent stake. When the construction of the South Stream pipeline was stopped in the first half of 2015, the Nord Stream joint venture concluded an agreement to build the Nord Stream 2 pipeline with a length of 1200 km and a planned annual transport capacity of 55 billion cubic metres. The construction is planned to be completed by 2019. The planned total annual transport capacity of the Gazprom 1 and Gazprom 2 pipelines is 110 billion cubic metres of gas. In April 2017, five big European energy companies (ENGIE, OMV, Royal Dutch Shell, Uniper and Wintershall) signed an agreement with Gazprom to cover 50 per-

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

The Nord Stream 1 and the Nord Stream 2 pipeline of Gazprom

cent of the costs. This is of paramount importance, as Gazprom plans to complete 80 percent of gas transportation to Europe on this route; thus, in the near future, Ukraine would lose revenues by no longer playing the role of a transit country. The Baltic-Adriatic corridor The Baltic-Adriatic (TEN-T) Core Network Corridor

The EU’s Baltic-Adriatic transport corridor is of paramount importance for the Central and Eastern European region, as this North-South corridor connects Poland, which has a coast along the Baltic Sea with Slovenia and Italy, which have a coast along the Adriatic Sea. One of the transport corridor’s major long-term developmental goals is the establishment of the missing infrastructural links between Poland, the Czech Republic and Slovakia. The corridor has two starting points in Poland. The first one is Szczecin, whose seaport is in Swinoujscie (the LNG terminal, which was opened in 2016, is located there), and the second one is the busiest seaport of Poland, Gdansk (Gdynia). The transport corridor starting from Szczecin runs through Poznan and Wroclaw to Ostrava in the Czech Republic, continuing through Pferovo and Brno to Vienna. The corridor starting from Gdansk connects Warsaw, Lodz and Katowice, and passing through the Slovakian cities of Žilina and Bratislava it also reaches Vienna. From Vienna and later from Graz, one of the transport corridor’s branches runs towards Italy, where passing through Udine it reaches Venice, where it establishes a transport link between Venice, Padua, Bologna and Ravenna. The second branch of the corridor starting from Graz runs towards Ljubljana and establishes a transport link between the Slovenian port of Koper and the Italian port of Trieste.

The countries and the three basic principles of the Three Seas Initiative

However, it is important to note that this corridor only partially contributes to the establishment of a new Central and Eastern European North-South economic field of power, since it does not concern Hungary and Croatia. Instead, it strengthens the transport links between Poland, the Czech Republic, Slovakia, Austria and Italy. The Three Seas Initiative has been launched with the aim of establishing a new North-South link in the Central and Eastern European region. This initiative has set the target of establishing new economic relations between the Baltic, the Adriatic and the Black Sea. Therefore, as opposed to the TEN-T corridors of the EU, this initiative does not aim to establish a relationship (on a residual basis) between the former EU Member States and those Eastern countries which acceded to the EU in 2004. Instead, its objective is to create a new economic field of power where the aim is indeed the development of the given geographical area and the establishment of transport links with Western Europe is not a key consideration. The Three Seas Initiative was initiated by Kolinda Grabar Kitarovic and by Andrzej Duda. The former is the President of Croatia, which has the longest coastline

along the Adriatic Sea (5 835 km), and the latter is the President of Poland, which has the largest national economy out of the Central and Eastern European countries and a 440 km coastline along the Baltic Sea. The first summit took place in Dubrovnik in the summer of 2016. The 12 participating states were the following: Poland, Estonia, Latvia, Lithuania, the Czech Republic, Slovakia, Hungary, Austria, Romania, Slovenia, Croatia and Bulgaria. Although Romania and Bulgaria, which have a Black Sea coastline, are members of the Three Seas Initiative, one of the most problematic issues is the establishment of stronger economic relations with the Black Sea region. The big question is whether Ukraine (with a 2782 km Black Sea coastline) will play a role in this initiative at all. This Three Seas Initiative is very similar to the 16+1 initiative by China. As opposed to the Western Balkan countries, Austria is not part of this initiative. The second summit was organised in Warsaw in the July of 2017, which was attended by the President of the United States, Donald Trump, who interpreted the Three Seas Initiative as the Central and Eastern European region’s independence from Russia, more precisely from Russian natural gas deliveries. In his

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

speech held in Warsaw he said Russia was the country posing the biggest threat to the safety of the Central and Eastern European region and he confirmed that NATO was ready to protect the region against any kind of Russian aggression. However, the motivation for Donald Trump’s visit to Warsaw was geo-economic, rather than geopolitical, as the first American LNG Carrier, the Clean Ocean, had arrived at the new LNG seaport of the Polish city of Świnoujście at the beginning of June, several weeks before the US President’s visit to Warsaw. The key question of the near future is what role LNG shipments from the US will play besides or instead of LNG shipments arriving primarily from Qatar. At the end of July, after the visit of Donald

The planned North-South energy gas corridor

Trump, the US House of Representatives voted in favour of imposing new sanctions on Russia. These sanctions concern all the energy companies of Russia and even those European companies which participated in Russian energy investments. Obviously, it affects primarily Gazprom’s investment in the Nord Stream 2 pipeline. The third summit will take place in Bucharest in 2018. Thus, while the first two summits were organised in a country of either the Adriatic or the Baltic Sea, the third summit will be held in Romania, which has a Black Sea coastline. The Świnoujście LNG (liquefied natural gas) terminal in northern Poland was inaugurated in 2015 and put into operation in 2016. The terminal, which was began to be built in 2011 with a budget of EUR 830 million, should have been ready by the middle of 2014. In the presence of President Andrzej Duda, the gas terminal was named after Lech Kaczynski, a former Polish President, who died in the Smolensk plane crash in 2010. Lech Kaczynski initiated the establishment of the gas terminal back in 2006. Due to the delay of the project, there was a need for the modification of the contract regulating the delivery of Qatari liquefied natural gas (LNG), which had to be transmitted through the terminal. On the basis of the modified contract, the gas which is not used in the Polish terminal can be sold by the gas transporter on other markets, too. Currently, there are two gas storage terminals with a capacity of 5 billion cubic metres, which cover approximately one third of Poland’s annual gas demand. The Świnoujście LNG terminal is a project supported by the EU. It is a part of a North-South gas corridor, leading to the Croatian island of Krk, where an Adriatic gas registration terminal is planned to be constructed The Polish gas pipelines running from the Baltic LNG

terminal will transmit gas to Gdansk, which is also a Polish seaport, and to Lwówek, located in northern Poland. Furthermore, it will be possible to deliver gas from the Polish gas pipelines to Germany, Slovakia, the Czech Republic and Ukraine, through the existing gas interconnectors. The operation of the terminal is limited, as the Nord Stream pipeline, inaugurated in 2011, which crosses the maritime routes leading to this terminal, makes the transport of LNG ships with a draught of more than 13.5 m difficult. Besides the northern, Baltic terminal in Poland, another terminal is planned to be constructed in the south, in the island of Krk. It is the Adriatic LNG terminal, which is expected to be ready by 2019 and to work with an annual capacity of 6 billion cubic metres. The terminal in the island of Krk would ensure the natural gas supply of the Polish, the Czech, the Slovak and the Hungarian market as well and it is also expected that there would be gas deliveries to Ukraine, too. Thanks to these two terminals, it would be possible for the first time to establish a new North-West energy corridor in the Central and Eastern European region, running from the Baltic Sea to the Adriatic Sea. Thus, instead of depending on Russian gas, gas import from global markets could be geographically diversified for the first time. The figure above demonstrates this particular NorthSouth energy corridor, focusing on the plan of establishing a Polish-Slovak gas distribution centre. The Orient/East-Med corridor The Southeast-Northwest Orient/East-Med transport corridor establishes a transport link between the busiest seaports of Greece (and Cyprus) and Germany. More precisely, it will establish a link only in the future, as the southern and the middle parts of this TEN-T corridor still

The Orient/East-Med (TEN-T) Core Network Corridor

require large-scale developments. The maritime route of the corridor starts from Larnaca Port in Cyprus, continues to the island of Crete and turns into a land route at the port of Piraeus in Greece. One branch of this transport corridor connects Athens and Piraeus with important cities located in the western part of the Greek Peninsula. From here, passing through the city of Thessaloniki, it continues to the Bulgarian city of Sofia. From Sofia, one branch of the transport corridor runs towards the port of Burgas, while the main branch of this TENT corridor continues from the Bulgarian city of Vidin to Romania. It enters Hungary at Lőkösháza, which can be found on the route between Oradea and Arad, and continues to Budapest through the Békéscsaba-Szolnok route. Then, from the direction of Bratislava and Vienna, it continues to the Czech Republic and at Děčín, on the Prague-Mělník route, it enters Germany. In Germany, one of the main routes passes through Berlin to the port of Rostock. The second main route runs to the port of Hamburg and Bremen through Leipzig and Magdeburg. This transport corridor runs through EU Member States exclusively; therefore it makes a detour towards Bulgaria and Romania. However, the traditional Western Balkan route (as well as the migrants’ major land route) follows the geographically shortest route from Greece through Macedonia and Serbia to Hungary. The newest map of the EU’s TEN-T transport corridor already includes the new planned branch of the Orient/East-Med corridor, the Thessaloniki-Skopje-Pristina-BelgradeBudapest route.

The rehabilitation of the Budapest-Belgrade railway is of paramount importance for the commercial relationship of China and the EU, as, thanks to the maritime route of the Chinese Silk Road, the goods shipped to the port of Piraeus, from where they should be delivered to Western Europe, can be transported through Macedonia, Serbia and Hungary, which will be the fastest way. The rehabilitation of Serbian section of the Budapest-Belgrade railway began last November. After the modernisation, the journey between the two capitals will take only three hours, instead of the current eight-hour journey time. The project is financed by China. The railway rehabilitation project is important from a number of aspects, since this is the first cross-border project that will be implemented within the framework of cooperation between China and 16 Central and Eastern European countries, and this is the first tripartite agreement that has already been signed and whose implementation has already been started. Furthermore, it is also unique, because China, an EU Member State and a non-EU country take part in this project together. The project is executed by the China Railways International and the China Communications Construction Company and it is planned to be completed in three years. After the renewal, the trains will be able to run at a speed of 200 km/h on the first 20 km section and they will be able to run at a speed of 120 km/h on the rest of the section. The average speed of the trains on the whole Serbian section will be 120-180 km/h. So far, the speed has barely reached 70 km/h. In order to build a double track electrified railway line between Budapest and Belgrade, a 350 km railway section has to be renovated, out of which 166 km runs through Hungary and 184 km passes through Serbia. Besides passenger traffic, this railway line will also be suitable for freight transport. The complete rehabilitation and modernisation is planned to be finished by 2023. The call for proposals for the design-build procurement procedures concerning the section in Hungary between Soroksár and Kelebia (which is a 152 km railway line) appeared on the website of MÁV (Hungarian State Railways) on 27 November 2017, which was also the day when the 16+1 Forum of China and the 16 Central and Eastern European Countries commenced in Budapest. As analysed above, the land route of the Chinese New Silk Road Economic Belt has two European gates, the Polish/Belorussian Terespol/Brest and Záhony in Hungary. However, the European gate of the 21st century Maritime Silk Road is obviously the Greek port of Pi-

Central and Eastern European Countries in the Multi-polar World of the 21 ST Century

a Eastern-Central European economic field of power underpinned by a new north-south infrastructural corridor could serve as a suitable basis for Hungary, too, for adopting a considerably more independent foreign policy strategy. The necessity for the creation of this Central and Eastern European North-South economic (and political) power field has already appeared in the post-World War I. settlement plan of Józef Piłsudski, Polish marshal. Piłsudski coined the term of Intermarium which referred to a closer cooperation between the countries of the region, stretching from the Baltic to the Adriatic and Black Sea, with the aim of retaining their independence. The “grand geopolitical chessboard” of the 21st cen-

raeus. The Chinese state-owned company, COSCO, began to operate the container port in 2008. In February 2013, the railway line of the port of Piraeus was connected to the European rail network and since then, it has been functioning smoothly. In August 2016, COSCO bought a 67 percent stake in the port of Piraeus from the state-owned company, the Piraeus Port Authority; thus COSCO has become the majority shareholder. The state-owned COSCO is China’s largest and the world’s fourth largest marine shipping company. This year an estimated 3.4 million containers will be unloaded at the port of Piraeus by this company. Currently, COSCO sends three trains a week from Piraeus to Hungary and through Hungary to Central Europe. Through the construction of the Budapest-Belgrade railway line, Hungary would have a realistic chance of becoming the Central European distribution centre of the Chinese products delivered by sea. In 2016, the port of Piraeus was the 8th biggest container port in Europe; however, according to the forecasts, it could become Europe’s largest container port by 2030. 9. Central and Eastern Europe as the “bridge region” of the 21st century’s Eurasian supercontinent – towards a new geopolitical frame of mind The most optimistic scenario with regard to our region is that Central and Eastern Europe will become a “bridge region” not only between Western and Eastern Europe but between Europe and Asia too. Will the Eura-

sian supercontinent ever become reality? It is beyond dispute that by now the Eurasian supercontinent of the 21st century has already started taking shape, primarily because of the intensifying economic cooperation between Russia and China. However, the main question is what Asian-European political and economic relations will be like and whether the European continent is going to constitute a part of Eurasia or not? Despite all its inherent risks, the multi-polar world currently in the making provides new geopolitical opportunities, too. In my view, the global economic and political role of East-Central Europe and the members of the Visegrad Group in particular could be that of a mediary between the major economic and political power fields in the 21st century. From an economic perspective this could bring about the dominance of transport services and intermediary activities in the field of business and finance in the region. Ideally, Hungary could become a logistics hub for both western (primarily from North-America and Western Europe) and eastern (predominantly from Russia and China) transnational companies. In my opinion, in order for Hungary to become successful on the long term, it should strive towards becoming a strategically important geographical spot, that is, a “bridge state” in the multi-polar world of the 21th century. Can a country as small as ours have its own foreign trade and foreign policy strategy? In the current period of “deglobalisation” and ever-strengthening macro-regions, intensifying the cooperation among the countries of the Visegrad group and establishing

tury is going through fundamental changes, and owing to the evolving multi-polar world there are new “pieces” appearing on the board that will bring new rules to the game. Even though everything is in motion, the fundamental question remains the same: Will Halford Mackindr’s World Island, that is, the Eurasian continent ever take shape as an actual geographic territorial unit and will we be able to investigate global political relations in terms of the World-Island–American continent dichotomy in the near future? In my view, in order for the Central and Eastern European region to be as successful as possible in the evolving Eurasian power field, it is indispensable for the citizens of the region to change their traditional, entrenched, Cold War-like perception of the world and adopt a fundamentally new geopolitical way of thinking. One of the main elements of this is profoundly changing the way we perceive Russia. For Hungary the realistic assessment of Russia, and learning as much about it as possible would be of great importance, regardless of the actual global political situation. Furthermore, it is also imperative that we profoundly change our “entrenched” stereotypical way of thinking about “looking up to the West and disdaining the East”. Instead of the general and fundamentally flawed common simplifications (e.g.: the Eurasian Economic Union is the enemy of the European Union), we have to adpot a new geopolitical view. We have to accept the existence of the multi-polar world and the evolution of a new 21st century Eurasian continent, and most important of all, we have to accept that Hungary is a bridge state between the western half of Europe and the eastern half of Asia. But can we change our way of thinking in the years to come? Can we adopt an “eastern way of thinking”? The differences between Eastern and Western way of think-

ing and strategy can be interpreted in terms of the differences between the games chess and go. Chess is a typical example of a zero-sum game since the victory of one player entails the defeat of the other. Therefore, chess is about total victory, its aim is to mate the opponent: to attack the king of the opponent and to put him into an impossible situation. In other words chess is about the final, decisive battle. Put into everyday terms, it means either white or black, either the West or the East, the USA or Russia will emerge victorious. In essence, the Cold War era was reminiscent of a game of chess. It is no coincidence that in American geopolitics the scene of global politics is called a chess board – after Z. Brzezinski’s term. On the contrary, the game wei qui (its Japanese name is go) is about prolonged warfare. If translated word by word the name of the game means “board game of surrounding”. The principle of the game is strategy itself, the strategy of encircling. In his book about China, Henry Kissinger describes the characteristics of Chinese strategy, different from those of Western strategy, through the book of Sun Tzu, “The Art of War”. According to Kissinger “Hence the task of a strategist is less to analyse a particular situation than to determine its relationship to the context in which it occurs. No particular constellation is ever static; any pattern is temporary and in essence evolving......Sun Tzu uses the word “shi” for that quality, a concept with no direct Western counterpart.” But will we be able to use this Chinese way of thinking in the future? Do we have the ability to apply the shi approach, that is, the method of constantly adopting to the ever-changing situation, in economic and political strategy? Are we able to redefine the geopolitical position and strategy of the Central and Eastern European region in the 21st century by using the shi approach? In my view, getting acquainted with the strategic principles and rules of wei qi (go) provides a useful basis for the creation of this novel mind-set and new set of strategies. The four strategic principles of the game serve as the main foundation and guideline for creating long-term strategy. These are the following: 1. Principle of counterattack: As the saying goes, the best defense is good offense, and this is also valid in go. If we adopt a defensive strategy then the game will go exactly the way the opponent planned it.

Therefore, it is advisable to reply to an attack with a counterattack, if missing out on defense will not harm us. When conducting a counterattack, our move should always force an immediate response from the opponent. Therefore, always try to initiate first. 2. Principle of containment: If we can isolate the territory of the opponent from other parts of the board then we will be at an advantage. The isolated territories will not able to affect the course of the game later on. Thus, in given situations, it is worth making smaller sacrifices. 3. The principle of resilience: We should strive towards achieving our goal, however, we should always take note of the opponent’s moves. It might become necessary to make a change of plans at some point. This also implies, that as long as it is possible that the move of our opponent changes the game fundamentally, we should only make preparatory, tentative moves. 4. The principle of reducing losses: Even our best plans might be thwarted by out opponents. In this case, it

is crucial for us to have an opportunity to minimize casualties. The so-called ten golden rules of wei qi (The golden rules were compiled by Wang Jixin, a renown Chinese wei qi player who lived in the era of the Thang dynasty (618-907)) provide assistance in the tactical implementation of long-term strategies. Ten golden rules of wei qi: 1. Greediness is not victorious! 2. Be unhurried to enter opponent’s territory! 3. Take care of oneself when attacking others! 4. Discard stones to gain sente! 5. Abandon small to save big! 6. When in danger, sacrifice! 7. Make thick shape, avoid hasty moves! 8. A move must respond to the opponent’s! 9. Against strong positions, play safely! 10. Look for peace, avoid fighting in an isolated or weak situation!

COOPERATION OF THE VISEGRAD 4 GROUP

ABOUT THE V4 COOPERATION Building upon its historical antecedents, the Visegrad Cooperation was formed in Visegrad, Hungary on 15th February 1991. The aim of the cooperation created then with the participation of three members was to facilitate the accession of its member states to the Euro-Atlantic community. HISTORY OF THE VISEGRAD GROUP Visegrad Castle, the sear of the Hungarian kings of the time, was the venue for the summit of the Polish, the Czech (Bohemian) and the Hungarian kings in 1335. The monarchs agreed upon close cooperation in politics and trade, which inspired their presentday descendants for this successful Central European initiative. The Visegrad 4 Group is an unofficial name for four Central Europe, post-communist states, including the Czech Republic, the Republic of Hungary, the Republic of Poland and the Slovak Republic. The Group was originally called the Visegrad Three, but since the dissolution of Czechoslovakia in 1993, the name Visegrad Four has been used. The name of the group was selected at an event held on 15th February 1991 by the President of the Czechoslovak Republic, Václav Havel, the Prime Minister of the Republic of Hungary, József Antall and the President of the Republic of Poland, Lech Wałęsa. At the meeting, these politicians signed a declaration that the three (now four) countries would closely cooperate on their road to European integration. After the collapse of the Communist regime, their cooperation facilitated the transition from a totalitarian regime into a free, plural and democratic society. Due to the changes taken place in the early 1990s (regime changes, the dissolution of the Eurasian federal states), the international defence environment changed, and for years it was dubious whether profound political and economic changes could be implemented without taking lives. In addition, two main aspects of the military and national defence policy appeared on the states of the region after the dissolution of the Soviet Union in 1991: the inalterability of borders and the withdrawal of Soviet military troops stationed in the states of the former Warsaw Pact.

For the EC/EU, the security and stability of the Central European region was essential, which coincided with the accession intentions declared at the dawn of the regime changes in the Visegrad countries. The formation of the Visegrad Cooperation was primarily motivated by the following factors: • the desire to eliminate the remnants of the communist bloc in Central Europe; • the desire to overcome historic animosities between Central European countries together; • the belief that through joint efforts it will be easier to achieve the set goals; • the proximity of ideas of the then ruling political elites; • the Visegrad Declaration was issued on 15th February, 1991. After the dissolution of Czechoslovakia in 1993 and the establishment of the two successor states, the cooperation changed into a cooperation between four member states. The aims of the Visegrad group remained unchanged, and the first big wave of the fulfilment of the goals set was seen in April, 1999, when the Czech Republic, Poland and Hungary were invited to join the NATO. The European integration and Slovakia’s NATO membership took place in 2004, fulfilling the key aim with which the Cooperation had been created. The successful integration process created a qualitatively new situation, and higher expectations of the V4 Cooperation were aroused. Since 2000, by establishing the International Visegrad Fund, the intensity of cultural and social relationships has been increasing each year. The period from 2004 has also proven that the Visegrad Cooperation is also relevant in an Eu context. The heads of governments of the four countries draft-

ed their new, common goals in the New Visegrad Declaration adopted in Kromeříž, the Czech Republic, on 12 th May, 2004, declaring their intention to take advantage of their joint actions in a pragmatic way, free of illusions, focussing on common interests in the future. The document also outlines the mechanisms of cooperations (political, sectoral, expert-level, and high-level consultation meetings). OPERATING THE VISEGRAD GROUP The Visegrad Cooperation is coordinated by a rotating one-year presidency. According to the concept of presidency, this position was first held by the Czech Republic between 1999 and 2000, then by Poland, Hungary and Slovakia for a period of one year each. The significance of the Visegrad Group is marked by the fact that the high-profile political leaders of the four countries has been holding meetings with external partners of the V4 countries in the so-called V4+ format since 2000 (preferably several times under a presidency). It is the established practice of the V4 member states to consult each other on the political programme of the presidency; it is the responsibility of the rotating Presidency to develop and execute it. The cooperation of the Visegrad Group has been expanded and become – in a positive sense – natural, with an emphasis on practical details, and is not primarily characterised by large-scale events. The cooperation between governments is primarily implemented on experts’ level and in an operative way – in practice, it means that the ministries and other institutions of the four countries maintain close relationships, identifying the practical tasks of the cooperation and assessing inherent opportunities. The V4 Cooperation is primarily in the focus of ministries responsible for foreign affairs, more specifically the so-called national V4 Coordinators and their deputies. THE PROGRAMME OF THE HUNGARIAN V4 PRESIDENCY From 1st July 2017 to 30th June 2018, Hungary is holding the rotating Presidency of the Visegrad Group for the fifth time 2017. The significance of the Visegrad Cooperation, building upon mutual trust, flexibility, common traditions, values and in-

terests since its founding in 1991, has been growing recently. In the last 26 years, the V4 have been actively representing our regional interests, and since 2004 also within the European Union, while contributing to the prosperity and stability of the entire continent through their economic performance, activities aimed at enhancing connectivity, support provided to the neighbouring Western Balkans and Eastern Partnership regions, as well as a responsible approach taken during the unprecedented migration crisis afflicting Europe. The Visegrad Group continues to be a factor demonstrating stability and growth in the European Union that has the legitimate intention to contribute substantially and as equal partners to the dialogue on the future of the EU. THE HUNGARIAN PRESIDENCY OF THE VISEGRAD GROUP Effective regional cooperation in the V4 and V4+ framework remains essential, especially in light of the current changes and challenges affecting our region and the continent. Under the Hungarian Presidency in 2017-2018, crucial issues such as the United Kingdom’s withdrawal from the European Union, the ongoing debate on the future of the EU, including debate on the social dimension with significant impacts on the EU’s competitiveness, discussions on the EU’s post-2020 Multiannual Financial Framework, Cohesion Policy and Common Agricultural Policy will require constant V4 coordination and proactive presentation of common positions. In addition, our V4 Presidency has set the objective of reinforcing the stabilising role of the Visegrad Group as a stabilising factor in relation to current external challenges such as the migration crisis and the volatile security environment in our southern and eastern neighbourhood. In this context, the Hungarian V4 Presidency will focus on areas in which the Visegrad Cooperation can deliver tangible results and added value, ranging from various EU policies to global issues. The main objectives of the Presidency include: 1 European Visegrad 2 Regional Visegrad 3 Digital Visegrad 4 Global Visegrad

The Hungarian Presidency relies on the plans and achievements of previous V4 Presidencies, its objectives reflect a balance in line with current political developments and necessities, between tasks related to strengthening joint actions taken by the Visegrad countries within the EU (including preserving the traditional policies, the Cohesion Policy and Common Agricultural Policy), cooperation with neighbouring and other European countries, as well as V4 activities related to global partners and the strengthening of the V4 brand. The phrase â&#x20AC;&#x153;V4 Connectsâ&#x20AC;? has been chosen as motto by the Hungarian V4 Presidency, reflecting the significant positive impact of the Visegrad Cooperation that connects the four countries in terms of politics, economy and culture, while also referring to our priority to improve the energy and transport connectivity links in the region, and to develop a well-connected, innovative V4 region entering the digital age. The Hungarian Presidency of the V4 Group is equally committed to further improve dialogues, trust and cooperation between the V4 and other partners within the EU and globally. The V4 connects countries, governments, people, ideas and values in an inclusive and open manner. The Visegrad Group is determined to build upon the power of connectivity in a broader sense, in order to be involved in finding common responses to the challenges affecting the V4 region and the European community being its home. In addition to preserving traditional principles, the ability to renew and adapt has always been an important strength of the V4 countries and their cooperation. Beyond planned cooperation, the Hungarian Presidency stands ready to coordinate joint, swift V4 responses to unforeseeable developments.

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

Prime ministers of the V4 countries at the annual V4 summit in 2018

From July 2017 to June 2018, Hungary is holding the rotating Presidency of the Visegrad Group for the fifth time. The importance of the Visegrad Cooperation, based on the principles guiding the V4 since its founding in 1991, namely mutual trust, flexibility, and a focus on common traditions, values and interests, has been growing recently. In the previous 26 years the Visegrad Group has been actively representing regional interests, since 2004 within the European Union, while contributing to the prosperity and stability of the continent via their economic performance, cooperation aimed at facilitating connectivity, support towards the neighbouring Western Balkans and Eastern Partnership regions, as well as a responsible approach to the unprecedented migration crisis. The V4 countries constitute stability and growth in the European Union, and have the legitimate intention to contribute substantially and as equal partners to the dialogue on the future of the EU.

Efficient regional cooperation in the V4 and V4+ framework remains essential, especially in light of the changes and challenges affecting our region and the whole continent. Under the Hungarian Presidency, crucial issues such as the United Kingdom’s withdrawal from the European Union, the ongoing debate on the future of the EU, including the social dimension – with signifi-

cant impacts on the European competitiveness –, discussions on the EU’s post-2020 Multiannual Financial Framework, Cohesion Policy and Common Agricultural Policy will require constant V4 coordination and proactive presentation of common positions. Meanwhile, the Presidency will strive for reinforcing the Visegrad Group as a stabilising factor in relation to current external

challenges such as the migration crisis and the volatile security environment in our southern and eastern neighbourhood. In this context, the Hungarian Presidency will focus on areas in which the Visegrad Cooperation can deliver tangible results and added value based on specific common objectives in fields ranging from EU policies to global issues, in the following thematic structure: 1. 2. 3. 4.

European Visegrad Regional Visegrad Digital Visegrad Global Visegrad

The Hungarian Presidency builds on the goals and achievements of previous V4 Presidencies. The priorities also reflect a proper balance, as necessitated by current political developments and actual needs, between

tasks related to the V4’s common voice in the EU, preserving the importance of traditional policies (Cohesion Policy and Common Agricultural Policy), cooperation with neighbouring and other European countries, as well as V4 activities related to global partners, global issues and the further strengthening of the V4 brand. The motto of the Hungarian Presidency, V4 Connects, reflects the significant positive impact of the Visegrad Cooperation in connecting the four countries in terms of politics, economy and culture, while also referring to the Presidency’s focus on our tasks related to connectivity: improving energy and transport links in our broader region, and working on a well-connected, innovative region ready for the digital age. Equally important is the V4 Presidency’s commitment to further improving dialogue, trust and cooperation between the V4 and other partners within the EU and globally. The V4 connects countries, governments, people, ideas and values in an inclusive and open manner. The V4 is determined

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

to build on the power of connectivity in the broadest possible sense in order to find common solutions to challenges affecting the Visegrad Group as part of the broader European community. The ability to renew and adapt to new realities, while preserving the basic V4 principles, has always been a strength of the Visegrad Countries and the V4 format. Accordingly, along with planned joint actions, the Hungarian Presidency stands ready to swiftly coordinate adequate joint V4 responses to unexpected developments. 1. european Visegrad Dialogue on the future of the European Union and coordination on EU matters The countries of the Visegrad Group have been members of the European Union for more than 13 years, and all countries succeeded in fulfilling the role of the rotating presidency of the Council of the European Union. The V4 is a group of Member States taking part actively and responsibly in the common decision-making processes. Ideas and suggestions of the Visegrad countries, based on common European values and interests, represent important added value to the European integration. On this basis, the Hungarian Presidency of the Visegrad Group 2017-18 will work for a strong, well-functioning European Union with the aim to avoid further fragmentation. The functioning of the European Union should be aligned with today’s social and economic realities: first of all, instead of ‘more Europe’ we should focus on creating a ‘better and stronger Europe’, a more efficient Europe. To reach this goal, it is necessary that the European Union takes into account the opinion of every Member State and pays more attention to the voice of European citizens. After the Rome EU Summit it is necessary to protect and consolidate the achievements of the integration, with special regard to taking full use of the potential of the four fundamental freedoms, and to strengthen the role of Member States within the Union. The European Union can only be strong with the support of its citizens, and can function the best in symbiotic relation with the interests of its Member States. It is important that the European Union focuses on economic growth, job creation and competitiveness. The synergies stemming from the positive interactions of national and EU-level solutions can ensure the appropriate cohesion, convergence and competitiveness. Political unity can be best preserved by respecting national and regional diversity, history, culture and traditions

within the EU. Enhanced cooperation, fully in line with the Treaties, can in certain cases contribute to this goal. Building on the Declaration of the Rome Summit held on 25th March 2017, the Visegrad Group considers it important to continue the discussion on the future of the European Union during the Hungarian Presidency. Concluding the series of V4 conferences on the Prime Ministers’ level discussing the future of the EU, started in Prague in June 2016, the Hungarian Presidency plans to hold a major event dedicated to this topic, with the participation of the Visegrad countries and other partners. Presenting and representing the V4 countries’ proEuropean as well as realistic narrative in an open and pragmatic way is a key priority of the Hungarian V4 Presidency. V4+ conference on the future of the European Union In the context of the Rome Declaration the Presidency will focus on the following principles of cooperation between EU Member States: Subsidiarity: The solution to current challenges lies in a ‘strong Europe of strong nations’, where decisions are taken as closely to the citizens as possible. The Visegrad Group is interested in a European Union in which common policies support the achievement of national undertakings in accordance with the Treaties, as Member States are capable of tackling certain issues more effectively, taking into account the regional and local dimensions of the subsidiarity principle. Strengthening the role of national parliaments within the EU is a priority as it would enhance the legitimacy of the EU decision-making. In deciding whether national or EU-level steps are necessary, it is the potential contribution of any proposal to the competitiveness and security of the Member States and the continent, which should primarily be considered; Cooperation: For the sake of ensuring European political unity, it is necessary that every Member State aims at embracing the common objectives and principles. Therefore, the EU should focus on issues which unite us. In strategic questions directly affecting Member States and EU citizens the guiding principles should be mutual trust, common objectives, the equality of Member States and sincere cooperation. Respecting the strategic leadership role of the European Council is indispensable. In issues determining our common future, consensus at the level of Heads of State and Government is necessary; Competitiveness and economic convergence: It is in Europe’s fundamental interest to make Member States and European market actors more competitive. The economic strengthening of the continent depends

on the deepening of the internal market and the development of the industry, enterprises, research, development and innovation, more and more determined by digitalisation. Economic convergence among Member States and regions contributes to a better and more balanced functioning of the internal market and the competitiveness of the whole Union by gradually diminishing differences in development. The dynamic V4 market is an important vehicle of the economic growth of all the Member States of the European Union – it is the purchasing power of the V4 countries and their citizens that creates jobs and thus economic prosperity in many other Member States of the EU. To maintain that mechanism is, therefore, a vital interest of not only the V4 countries but the entire EU. Cohesion and Regional Policy are the primary tools in this context. They are not ‘charity’ but investment tools in the purchasing power of the converging economies. Informal negotiations preceding the publication of the Commission’s proposals on the post-2020 Multiannual Financial Framework (MFF) will peak during the Hungarian Presidency. In this process, it is an important goal of the V4 to preserve the current role of traditional common policies such as Cohesion and Common Agricultural Policies. The Visegrad Group stands for an approach based on competitiveness as regards initiatives connected with the social dimension. All the new projects related to the social dimension should remain open also to non-Eurozone members of the Union. Avoiding the handing over of competences from

Member States, social aspects, economic policy considerations and the principle of competitiveness cannot be separated; Security: Europe has to give a solid answer to the growing challenges coming from the deteriorating security environment. We should step up more effectively in order to strengthen the EU’s Common Security and Defence Policy to improve our resilience, capabilities and coherence, complementing NATO’s related efforts. The Visegrad countries have also been strong advocates for the protection of external borders since the beginning of the migration crisis, because the V4 considers the proper internal and external functioning of the Schengen system as one of the main prerequisites of European security as well as a precondition of economic growth and prosperity. The V4 is committed to the Euro-Atlantic integration of the Western Balkan countries as well as to the deepening of the economic integration and political association of, and cooperation with the Eastern Partnership countries, since these contribute to Europe’s security and stability. Achieving progress in this context is also important in terms of the EU’s credibility; Predictability: The European Union should be a reliable and constructive partner in the external dimension and should formulate credible and realistic undertakings towards its own citizens. We are responsible for keeping our own rules and regulations, for which the Lisbon Treaty provides an adequate basis. European citizens expect that the fundamental balance of the internal market’s integrity, a cornerstone of the EU, is not harmed.

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

This applies to all the four freedoms and in particular to the freedom of movement, a highly important value for the V4, which clearly demonstrates the advantages of integration among our citizens. The political context of the Hungarian Presidency will be significantly influenced by negotiations on the United Kingdom’s exit from the EU. In this field, our main objective is defining and representing our common interests while maintaining the unity of the EU-27. The V4 shall work for a fair and mutually beneficial agreement that adequately ensures balance between rights and obligations. One of the most important objectives of the Visegrad Group is to protect the rights and interests of citizens of the V4 countries living in the United Kingdom. Brexit cannot provide grounds for the weakening of the acquis concerning the free movement of persons or the providing of services related to the free flow of workforce in the EU-27. After Brexit it is important to make sure that the closest possible relations between the EU and the United Kingdom are maintained. It is a key interest of the Visegrad Group that financial aspects of Brexit are settled in a satisfactory manner and the existing obligations are observed by all parties. We are interested in an agreement regulating trade and investments cooperation between the EU and the United Kingdom that is balanced, based on mutual benefits and preserves as much of the current openness as possible. It is also an important joint goal of the V4 that the United Kingdom, a NATO member and an important European and global actor, remains closely connected to the EU’s Common Foreign and Security Policy including the Common Security and Defence Policy. Cooperation with eu partners The Hungarian Presidency of the Visegrad Group is open to dialogue and joint projects based on mutual interests with countries of the EU, with special regard to neighbouring countries, as well as other European and global partners. Germany is one of the key partners for the Visegrad Group. For the sake of increasing European competitiveness, facilitating digital economic transformation and enhancing the stability and security of Europe, the Hungarian Presidency supports consultations in the V4+Germany format. The Hungarian Presidency is ready to organise a summit of the Heads of Government of the Visegrad countries and Germany, in line with the intention of the parties declared at the V4+Germany summit in Warsaw in August 2016.

“The Hungarian Presidency aims to strengthen the cooperation of the Visegrad Group with Austria and Slovenia, partners with which the Visegrad Four can effectively coordinate positions on numerous issues such as migration, security, the stability of the Western Balkans and EU enlargement, digitalisation and innovation.” The Hungarian Presidency aims to strengthen the cooperation of the Visegrad Group with Austria and Slovenia, partners with which the Visegrad Four can effectively coordinate positions on numerous issues such as migration, security, the stability of the Western Balkans and EU enlargement, digitalisation and innovation. In the field of defence policy, the Hungarian Presidency will strive to strengthen cooperation in the V4+Slovenia and V4+CEDC (Central European Defence Cooperation) formats, focusing on Slovenia’s potential contribution to the V4 EU Battlegroup; and, in the case of CEDC (building also on Hungary’s Presidency in the CEDC starting in January 2018) with an emphasis on capacity development and coordinating positions on managing the migration crisis, also taking into account the role of armed forces. The Hungarian Presidency will continue the effective high-level political dialogue between the V4 and the Nordic-Baltic Eight (NB8), in cooperation with the Swedish Presidency of the NB8, particularly on topics such as the Eastern Partnership, regional security, energy and transport infrastructure. In addition, the Presidency will promote consultations with the Baltic countries, to discuss joint positions on EU matters with a special regard to the post-2020 Multiannual Financial Framework and to identify further possibilities of cooperation. The Hungarian Presidency also

aims to further strengthen V4+Baltic cooperation in the field of defence, building on the rotating V4 military presence in the Baltic States during 2017, as well as on examining the possibilities for a potential joint V4 contribution to NATO’s Enhanced Forward Presence. In order to facilitate mutually beneficial cooperation after the United Kingdom’s exit from the EU, the Hungarian Presidency will take steps to prepare the framework of post-Brexit V4+UK relations, while respecting the principle of EU-27 unity. The Hungarian Presidency will continue the cooperation of the Visegrad Group plus Romania and Bulgaria in the field of spatial planning and territorial development, in line with the six states’ ministerial declaration

position towards this complex problem and stood up for a comprehensive answer to the situation, with an adequate focus on stemming migration and underlining security as a key aspect of the future solution. This also applies to the V4’s joint action for the protection of the Schengen borders and thus the whole of Europe, representing V4 common positions in the political debates, as well as supporting countries on the Western Balkans route and crisis regions in countries of origin. In order to strengthen European security and stability, the goal of the Hungarian Presidency is to continue, where appropriate, the above-mentioned activities, identify further topics of possible V4 cooperation related to migration and broaden acceptance

and strategic document adopted in 2014 during the previous Hungarian V4 Presidency. The Presidency aims to coordinate positions as regards the regional dimension of cohesion policy.

of related V4 positions within the EU. The EU should be capable of giving comprehensive and effective answers to the challenges of migration. Since migration is one of the most pressing and important issues on the agenda of the EU, decisions which determine the migration policy of the EU and its future asylum system must be taken at the European Council level by consensus. The Presidency will advocate the position that stemming migration must begin outside the EU’s borders. In order to effectively represent our joint interests in the context of CEAS negotiations, including the future shape of the Dublin Regulation, regional coordination is also important. The V4 strongly opposes any proposal on introducing a mandatory and automatic distribution system in line with the corrective distribution system in the Dublin proposal. Commitment towards aspects of humanitarian aid and development assistance in the context of the migration crisis is also an important part of the V4’s complex approach to migration (related activities are detailed in Chapter 4 ‘global Visegrad’.)

With regards to cooperation in the field of agriculture and environment, the aim of the Hungarian Presidency is to extend the existing V4+Slovenia, Bulgaria and Romania cooperation to Croatia as well. In the field of water management, the Presidency intends to involve also Austria, Slovenia, and Croatia in the ongoing V4+Bulgaria+Romania cooperation. (see details in section ‘Cooperation in the field of agriculture, environment and water issues’ in Chapter 3). Building on synergies between the 2017 Hungarian Presidency of the Danube Region Strategy and the 2017–18 Hungarian V4 Presidency, the Presidency aims to stimulate cooperation between existing and planned macro-regional strategies. Moreover, the Presidency will look into synergies with other formats of regional cooperation in which all V4 countries participate. Responsible handling of the migration crisis Since the beginning of the mass migration crisis in 2015, the Visegrad Four have assumed a responsible

The main goals of the Hungarian Presidency related to migration are the following: • Coordination of positions in EU legislation and relevant policy actions (reform of the asylum system, relocation, migration compacts etc.); • Border control cooperation with third countries on the Western Balkans migration route; management of the EU external borders and protection of the Schengen area; support to Western Balkan countries, if necessary, by sending additional forces, equipment and sharing expertise; • Continuing permanent consultations started by previous V4 Presidencies, e.g. in the framework of the V4 Migration Crisis Response Mechanism announced in November 2016.

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

2. regional visegrad

Intra-V4 relations; parliamentary dimension; international Visegrad fund Regular dialogue between the Parliaments of the V4 countries represents an important dimension of Visegrad Cooperation. In this framework, the Hungarian Presidency will provide the necessary fora for discussing cooperation possibilities and current European developments, supporting endeavours of the Presidency. The Hungarian Presidency supports the successful functioning of the International Visegrad Fund, the V4’s common institution working for strengthening the relations in the V4 region. The Presidency will initiate the renewal of the Fund’s

promote the Year in the V4 region, including the presentation of sites in the V4 region awarded with the European Heritage Label, sites already on, or nominated to, the UNESCO World Heritage List, as well as the promotion of the region’s architectural heritage. Furthermore, the Hungarian Presidency will pay special attention to V4 consultations on current issues of cultural diplomacy. The Presidency will initiate talks on the following issues: EU financial resources in the field of culture; EU strategy for international cultural relations; the role of culture and creative industry; V4 participation in the reconstruction of destroyed monuments in the Middle East; utilising the Central-European Cultural Platform (PCCE; V4+Austria) in strengthening the

the exchange of experience on results and current challenges. Long-term V4 cooperation on e-health and fair pricing will be further encouraged. The Presidency will support discussion on the diaspora policies of the Visegrad countries, to facilitate the sharing of experience and best practices and joint thinking on tackling the related social challenges faced by the V4. In the field of sport which has an important role in strengthening intra-regional social relations, the Hungarian Presidency will, inter alia, support the ongoing V4 initiatives and facilitate projects (e.g. in the framework of the Visegrad Fund) related to sports. In order to foster mutual awareness and further improve mutual perceptions inside the V4, the Presiden-

contribute to a successful Eastern Partnership Summit in November 2017, in line with the goals of the Estonian EU Presidency. First and foremost we have to endeavour to present a clear perspective to our partners regarding their aspirations concerning the future of their relations with the EU and offer a European perspective for the interested partners. In order to maintain and strengthen the partners’ commitment to necessary reforms, coming up with a forward-looking agenda, concrete deliverables and new objectives at the summit are crucial. A productive summit would also enhance the credibility of the EU’s policy towards Eastern Partner countries. Close cooperation between EU institutions, Member States and our Eastern Partners is important during the

mobility scholarship schemes, including providing possibilities for researchers and start-ups. The Presidency will encourage result- oriented projects related to entrepreneurship and innovation. Another goal of the Presidency is to stimulate the creation of V4 expert networks and enhance strengthening relations between business actors and associations, based also on the experiences of the Think Visegrad – V4 Think Tank Platform. Concerning the Fund’s activities related to the Eastern Partnership and the Western Balkans, the Hungarian Presidency plans to continue effective dialogue with current and potential external donor partners of the Fund, with a view to improving and possibly widening the cooperation. Building upon the rich historic, cultural heritage and the diverse relations of the Visegrad Four, the Presidency’s aim is to strengthen regional cohesion by bringing the societies closer, as well as to jointly promote values of the V4 region externally. To this end, intra-V4 projects will be launched and several cultural events will be held worldwide. In relation to the European Year of Cultural Heritage in 2018, organised in partial overlapping with the Hungarian V4 Presidency, the Presidency aims to

cultural dimension of the Eastern Partnership. In the field of cultural diplomacy, Hungary also continues to suggest that the V4 countries, too, support the establishment of the International Museum on Communism in Washington, D.C., initiated by the Victims of Communism Memorial Foundation. The Hungarian Presidency of the Visegrad Group provides an opportunity to the V4 to exchange experiences and jointly present their achievements regarding the protection of national, ethnic and religious minorities and their cultural heritage, including the preservation of Jewish cultural heritage, thus also underlining the region’s commitment to Europe’s cultural and religious values as well as to fighting anti-Semitism. The Presidency will continue V4 discussion on higher education. Regarding youth and family policy, the Hungarian Presidency concentrates on the sharing of expertise and good practices of the V4 countries as well as the discussion on common challenges. The Presidency will hold consultations on nutrition and healthcare issues, the development of the public healthcare system and disability policies, to facilitate

cy will continue to support the cooperation of the V4 countries’ public media organisations. Furthermore, the Hungarian Presidency will organise the annual V4 Good Government Forum.

implementation of the Eastern Partnership policy. The Hungarian Presidency emphasises the importance of synergies between EaP projects of the EU and the V4, such as cross-border cooperation, connectivity agenda (including common infrastructure projects). The V4 will pay attention to the human rights situation in the EaP partner countries. As regards Ukraine, Georgia and Moldova, consolidating the achievements and implementing the necessary reforms arising from the Association Agreements should remain in focus. It should be thoroughly analysed how the EU can support and subsequently evaluate progress in the processes which have been already started, especially the transformation of the economy, the fight against corruption, public administration reform and strengthening civilian security which should contribute to enhancing resilience of those countries against security threats. V4 stands ready to further support the activities in the framework of NATO cooperation with Ukraine (Comprehensive Assistance Package), Georgia (Substantial NATO-Georgia Package, New, Practical Ways to Intensify Efforts, Defence and Related Security Capacity Building Initiative), and Moldova (DCBI), having in mind the transformational potential of these programmes. Fostering connectivity with special emphasis on energy, infrastructure and cross-border cooperation contributes significantly to stability and economic development, as well as mobility between the EU and our Eastern Partners. Eastern Partnership policy should focus equally on Belarus, Azerbaijan, and Armenia in the future. Any genuine commitment coming from these countries to build closer relations will be supported by the Visegrad countries. With the support of the V4, the commitment of Belarus to building closer relations with the EU and strengthening trade and economic cooperation should be maintained. Our strategic relations with Azerbaijan should be further developed through

Supporting our neighbourhood: Western Balkans and the Eastern partnership The Visegrad Four, as a group of countries traditionally committed to supporting the Western Balkans both in European political fora and in the form of joint projects, will actively facilitate initiatives aimed at strengthening the region’s stability, security and economy under the Hungarian Presidency. This is especially important in light of today’s growing challenges affecting the region. The key to the stability of the Western Balkans is the Euro- Atlantic integration of the region’s countries, therefore supporting the EU and NATO enlargement processes, including related efforts of the countries involved, is a highly important goal of the Presidency. Although enlargement is one of the EU’s most efficient policies, it is receiving limited focus amid current problems dividing Europe. The Commission’s Enlargement Package, published in November 2016, will not be followed by a new assessment in 2017. Therefore, assessing the enlargement process with the participation of the Western Balkan countries under the Hungarian V4 Presidency will be crucial. Concerning the Eastern Partnership (EaP), for the Visegrad countries it is vital that stabilisation and modernisation in the EU’s eastern neighbourhood becomes irreversible and gains further momentum. Therefore, the Visegrad Group remains a staunch supporter of the Eastern Partnership (EaP) policy as a key tool to foster this process. Despite the existing challenges, the Hungarian Presidency is committed to keeping the EaP high on the EU agenda and will strive to reach its full potential. Taking this into account, the Visegrad Countries wish to

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

strong treaty-based ties with special focus on the energy sector. Therefore, swift progress in the negotiations on a new EU-Azerbaijan framework agreement is particularly important. Concerning Armenia, a tailor-made approach should be followed, respecting the country’s foreign policy decisions. V4 should encourage Yerevan and EU partners to smoothly ratify and implement the EU–Armenia Comprehensive and Enhanced Partnership Agreement after its signature. Defence, foreign and security policy, non-proliferation, internal security V4 cooperation should be more efficient and visible within the framework of international organizations dealing with security issues. NATO remains the guarantor of security, credible collective defence and deterrence in the Central European Region. NATO’s Enhanced Forward Presence on the Eastern Flank will improve the Alliance’s defence and deterrence posture in this region while providing security to all Allies. The difficult security environment requires NATO as well as the European Union to continue efforts to adapt its policies, capabilities and instruments and to further enhance their cooperation. Preserving the unity of positions, coherence of actions, and improving cooperation among our countries should be at the heart of our endeavours within the framework of NATO and the EU. In accordance with the Action Plan of the Visegrad Group Defence Cooperation (July 2016 – June 2018) the Hungarian Presidency will pursue the following areas of cooperation: • Defence policy cooperation: In the field of policy dialogue and cooperation, the Hungarian Presidency’s goal is the strong representation of the V4 region’s interests in NATO and EU fora by discussing strategic defence policy issues and coordinating positions, including those on strengthening the NATO’s Eastern Flank, and on challenges related to the migration crisis; and the V4’s active participation in the debate about reviewing the EU Battlegroup (EUBG) concept; • Operational cooperation: Besides the successful realisation of the rotating V4 military presence in the Baltic countries in 2017, the Presidency primarily aims to coordinate preparations for the V4 EUBG’s next standby period in 2019, and examine possibilities for potential joint V4 contribution to NATO’s Enhanced Forward Presence as well as future V4 cooperation in EU and NATO operations; • Joint capability development: It is important to continue and deepen V4 cooperation in military capabil-

ity development and defence planning. The Presidency will continue the expert level and political consultations about the possibilities of regional capability development. Our long-term goal is to identify those areas of cooperation where the V4 countries can effectively contribute to the defence capabilities of NATO and EU; In the field of cyber security, the Presidency’s goal is to strengthen the resilience of critical infrastructure, especially with the aim of revealing and averting risks and attacks coming from the cyberspace. The Hungarian Presidency will carry on the cooperation between cyber security organisations and network security centres of V4 countries, for which information-sharing on incidents is indispensable. In cooperation with the rotating Chair of the Central European Cyber Security Platform, the Hungarian Presidency will organise expert meetings and joint exercises and trainings related to incident management. The Presidency also plans to hold consultations aiming to formulate joint V4 positions on current topics of the EU’s agenda, in particular on the implementation of the Directive on Security of Network and Information Systems (NIS), and the revision of the Cybersecurity Strategy of the EU. The Visegrad Group needs to be committed to the further improvement of joint actions in the fight against terrorism, with special regard to the EU-level implementation of PNR (Passenger Name Record) systems, and the intensification of information-sharing in the V4 and V4+ frameworks. In order to reach these goals the aim of the Presidency is, while fully respecting data protection rules, to actively contribute with all V4 countries to further work at the EU-level on the interoperability of systems and databases. The use of biometric identification in the asylum procedures and as regards border control should be intensified among the V4 and V4+ partners. The application of this method is also worth considering in relation to international public transportation. The Hungarian Presidency will strengthen V4 cooperation in the field of disaster management, concentrating on risk. ENERgY PolICY, ENERgY INfRaStRuCtuRE, ClImatE PolICY In the spirit of continuity, the 2017/2018 Hungarian Presidency will build on the programmes of previous V4 Presidencies including the Hungarian Presidency in 2013-14, setting the strengthening of the North–South interconnections as a priority. Continuing the work in relation to infrastructure development connected to the

North–South Gas Corridor, the completion of the corridor remains to be a priority of the Hungarian Presidency. In line with aspirations of the Energy Union, finishing the corridor would bring significant benefits in terms of the security of supply and market integration, not only for the V4 but for the whole Central European region, while also serving as a good example for successful regional cooperation. Another goal of the Presidency is the joint discussion of current energy and climate policy issues on the EU agenda from a regional perspective. Building on the achievements of the CESEC Ministerial Meeting held in Budapest in September 2016, the Hungarian Presidency will organise high-level energy diplomacy meetings and business forums to enhance the political focus on the completion of the North-South Gas Corridor, giving new impulses to the expansion of ongoing infrastructural and market development projects and also opening northern and southern gates for the global energy market. In terms of energy policy, the Hungarian Presidency plans to achieve progress in areas of cooperation which are in line with the goals of the Energy Union, closely linked to the dimensions of energy security and internal energy market and important for all Visegrad countries. In the field of climate policy, the Hungarian Presidency sets the following goals: Regarding the decisive stage of review of the EU Emissions Trading System (ETS), in order to ensure the ETS’s effective functioning after 2020 in line with the European Council Conclusions agreed in

October 2014, in order to find synergies between European climate, energy and industrial policies and to avoid collisions of European policies with national priorities, the Hungarian Presidency supports closer V4 cooperation in information and position sharing. The Presidency also aims to support expert discussions and coordinate positions (where possible) so as to facilitate finding the equilibrium between economic growth and meeting climate policy goals and achieve well balanced legislative package, in relation to sectors not regulated by the ETS (transportation, agriculture, waste management, buildings) and the proposal concerning the emissions and sinks from land use, land use change and forestry (LULUCF); With respect to the negotiations elaborating the implementation rules of the Paris Agreement, not prejudging its outcomes, the Hungarian Presidency supports V4 cooperation on this process. In case there is any proposal to increase EU ambitions, the Hungarian Presidency will ask for V4 country views on a possible rise of previously agreed EU emission reduction goals, with special regard to effects on ‘carbon leakage’ and ‘investment leakage’ which are highly important to the V4. In the context of the Facilitative Dialogue, if applicable, the V4 should support pressuring other parties with lower ambition levels to raise their commitments to have a level playing field among parties, since the EU and its Member States submitted one of the most ambitious commitments; Hungarian presence in the Board of the Green Climate Fund. The size of available projects and the technical

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

sources required may exceed the capacities of individual countries; thus chances of the subjects from the V4 countries to become project implementers could be improved by sharing experience on technological and financial details and connections within the frame of a project to be proposed during the Hungarian Presidency, Transport policy and infrastructure In the field of transport, the main priorities of the Hungarian Presidency are the strengthening of the major North– South transport connections, the improving of the permeability of borders between the V4 countries and the deepening of cooperation between V4 transport experts. The Presidency will continue the consultations of transport experts on current EU legislation, especially in the following topics: • Close and continuous V4 coordination concerning the EU ‘Road Package’, with special regard to its social aspects. In the discussion on the ‘road initiatives’, preparation and active presentation of the common V4 position at the EU fora is envisaged. It is particularly • Cooperation and consultations on Aviation Package ‘Open and Connected Europe’ with a view to seek for the most constructive, competitive and fair solutions for the EU and enabling the elimination of connectivity gaps within the EU; • The formulation of a joint regional position concerning the revision of the 92/106/EEC Directive on Combined Transport of Goods. Significant changes are expected concerning the supportability of given methods of transport; it is important that the railway receives a better position, and that Central European specificities are taken into consideration; • Joint action concerning the revision of the NOISE TSI directive so as to avoid possible competitive disadvantages for the Visegrad Group; • Joint action concerning the Train Drivers Directive; • Cooperation and consultations on the revision of the regulation 1371/2007 on rail passenger rights and obligations; • Joint action concerning the revision of the Clean Vehicle directive (2009/33/EC). V4 Rail Roundtable’ could serve as a platform to establish common Council positions for expert discussions on transport. Increasing the competitiveness of rail freight transport along the North–South corridors

is a strategic interest for our region, in order to exploit railway infrastructure developments. It is important for the Hungarian Presidency to contribute to utilising synergies between the Hungarian V4 Presidency and the 2017 Hungarian Presidency of the Danube Region Strategy. For a successful cooperation, the sharing of experiences and best practices among V4+CEE enterprises dealing with terminals, railway freight transportation and railway operators is highly important. CEE FUTURAIL 2017 conference of Central and Eastern European rail freight transport managers. It is a priority for the Hungarian V4 Presidency to jointly prepare for the post-2020 EU financial period, building also on the High-Level Working Group (HLWG) established during the 2013-2014 Hungarian Presidency. During the negotiations concerning the post-2020 Multiannual Financial Framework, our goal is the harmonisation of V4 positions, and the incorporation of CEE viewpoints since preserving the key role of the transport sector is a common interest of the Visegrad Group, serving the strengthening of the countries’ economy. It is necessary to map the railway connections of the Visegrad region. An assessment was already prepared following the announcement of the 2013 Action Plan; the Hungarian Presidency aims to foster the reviewing of the results of the assessment and to define possible development directions which may be harmonised with the V4 countries’ strategies on transport development. Based on this it will be necessary to facilitate, via expert consultations, the removal of technical and legislative obstacles, which is necessary for unblocking transport bottlenecks. The Hungarian Presidency will provide an opportunity to summarize V4 experiences and discuss ways of cooperation.

During the Hungarian Presidency the V4 will endeavour to further develop cooperation on inland waterway transport. Rivers are important elements of international, multimodal transport corridors as they provide low emission, economically feasible and easier access to the V4 and EU markets. The V4 continues to consider the Three Seas Initiative as a possible channel of political cooperation between the Visegrad Group and other countries of the AdriaticBaltic- Black Sea region, providing forum to discuss, inter alia, transport and energy issues.

Further objectives of the Hungarian Presidency in the field of transport: • To build traditional and alternative fuelling stations (electric, LPG, LNG, CNG) along North–South routes; • Expert consultations on the state of play in electromobility in the V4 countries (number of vehicles, outlook on the future of this sector, state subsidies); • Sharing the experiences concerning the development and support of innovation in the field of electro-mobility; • Expert consultations on the experiences of public road toll systems in the V4 countries; • Sharing experiences on financing developments, reconstructions and operation, in relation to various financial constructions (e.g. PPP, EFSI, CEF); • Sharing experiences on cross-border transport development projects (Interreg); • Developing cross-border sub-regional passenger transport, with an emphasis on

– the sharing of continuously updated timetables between the countries; – examining the possibilities of establishing a common tariff system including cross-border public services; • Examining the possible launching of a ‘VisegRail’ initiative aimed at fostering intra-Visegrad tourism by offering regional railroad tickets and season tickets; • Organising a professional conference on cycling during the second half of 2017; • Sharing experiences concerning the use of awareness-raising methods – conference on the ‘Passing 7 borders by bicycle’ (series of events), the ‘Mary’s Way’ (CEE pilgrimage route) and the Maria Marathon (ultramarathon trail) with the participation of civil society, local municipalities, EGTCs and experts (1st half of 2018). • Exploring potential synergies between the Visegrad Group and the Eastern Partnership countries in terms of transport connectivity.

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

3. digital visegrad

Competitiveness in the eu: multiannual financial framework, cohesion policy, agricultural • The V4 countries are interested in an economically stable European Union. In order to ensure sustainable economic growth, the competitiveness of the Union

specting the competences of Member States and competitiveness are key aspects in the debate on the social dimension. The question of social benefits cannot be handled without taking into consideration the aspects of competitiveness and economic policy. •A ccording to the current MFF regulation the European Commission should present its proposals for the post 2020 Multiannual Financial Framework by 1 January 2018. However, based on information from the Commission, the publication of the substantial MFF proposals might be delayed due to uncertainties related to handling the financial aspects of Brexit until the end of the first half of 2018. As the conclusion of the Brexit negotiations will influence the future MFF

post-2020 regulation is expected by 2018. The Hungarian Presidency aims to respond, also by a joint ministerial declaration in the V4+Romania, Bulgaria, Slovenia, Croatia format, to EU-level developments and represent the region’s interest. The European Commission is planning to present its plans concerning the new framework of the Common Agricultural Policy for the years 2021–2027 in autumn 2017. Jointly discussing the proposals is an important goal of the Hungarian Presidency. According to the Visegrad Group’s position, competitiveness and economic convergence are key aspects in the debate about the social dimension. Only sustainable economic growth resulting in real economic con-

and competitiveness of public administration. Further V4 cooperation is important as regards the proposed amendment to the Posting of Workers Directive (96/71/ EC). The Presidency aims to discuss the strengthening of cooperation in the field of labour policy cooperation inside the V4 and with the EU, concerning especially the mutual challenges on the labour market (Brexit, the free movement of workers and services).Concerning undeclared work, the Presidency supports the exchange of information, the sharing of good practices, the presentation of solutions and the legal background in the V4 countries, and the strengthening of V4 representation of interests in the European Platform tackling undeclared work. Concerning the field of occupational safety and

must be improved. This requires a proper investment environment which favours job creation and equal accessibility of digital technologies and skilled labour, indispensable for the countries’ prosperity. To effectively represent V4 interests in the European Union, the Hungarian Presidency will further strengthen cooperation concerning economy- related EU issues such as the Economic and Monetary Union, the Capital Markets Union, the Single Market including the Digital Single Market, the banking union, taxation and customs, as well as the joint fight against recently spreading protectionist tendencies in some Member States. Re-

greatly, it is important to maintain in this process the proper financing of policies set out by the Treaties including the Cohesion Policy and the Common Agricultural Policy. Therefore, Hungary is ready to take a leading role in harmonising the positions of the V4 and other like-minded countries. •C ohesion Policy •C ohesion policy contributes significantly to the economic performance and convergence of the V4 and the EU. The cohesion report will be published by the Commission after the June 2017 Cohesion Forum; the presentation of the Commission’s proposal concerning

vergence can contribute to social welfare, the most important conditions of which are> • enhancing competitiveness; • increasing employment rate and improving the quality of employment (improvement of education and healthcare conditions); • supporting digital transition through training and incentives; • increasing capital stocks through investments.

health, the aim of the Presidency is to coordinate and exchange the good practices in the following areas: the effects of improving working condition on competitiveness; the role of the state in supporting SMEs in providing safety in the workplace. The Hungarian Presidency encourages V4 cooperation in the field of the healthcare industry and organises a thematic forum with the participation of V4 senior managers and experts responsible for the healthcare industry. Goals are to strengthen the cooperation tied to V4 health economy and Industry 4.0, to take joint action concerning process control, to cooperate in the fields of healthcare robotics and nanorobotics, to foster joint R+D to create innovative products. Regarding the latter, coordinated export and trade activities are also to be proposed by the Presidency.

• Increasing the competitiveness of Central Europe is a key priority for the Hungarian Presidency, with special regard to meeting the challenges of the digital age. This chapter features those important current priorities and objectives of the V4, which are related to the broader topic of competitiveness.

Hungary supports that the related negotiations focus on the competitiveness of the whole EU and the state of the Internal Market. Structural reforms tailored to national specificities are the most effective in reaching the goals mentioned above. Compulsory social standards can be counterproductive by undermining convergence based on improving competitiveness. The Hungarian Presidency will initiate joint V4 action concerning the prolongation of the Swiss Contribution. It is a joint V4 priority to reach an agreement concerning releasing the post-2017 funding of the Swiss Contribution as early as possible. The Presidency aims to ensure the effective representation of regional interests in this context. It is a key priority of the Hungarian Presidency to contribute to improving the competitiveness of the V4 and the EU, and to discuss important topics such as Industry 4.0 issues of the reindustrialisation of Europe and other current EU topics related to economy and economic policy. A key element of the success of any Industry 4.0 or other digitalization initiative is the availability of digitally competent labour force. Hence, cooperation on the development of the digital labour market is also of high priority. Owing to the fact that the digitalization exempts civil servants and civil officials, it is essential to enhance international cooperation and training programmes in order to improve the effectiveness

Digitalisation The V4 should assume a greater role for the V4 in fostering and setting the agenda in international cooperation in the field of digitalisation. This, as well as the followup on the Warsaw Declaration on mutual cooperation in research, innovation and digital affairs, signed on March 28th 2016 by the Prime Ministers of the Visegrad countries, will be facilitated inter alia by organising a major related conference during the Presidency, providing a platform for defining new regional tasks and activities. In order to enhance the V4 countries’ digital competitiveness and the implementation of the EU Digital Agenda, the Hungarian Presidency supports creating a regional dimension of cooperation in the field of digitalisation, which can supplement national and EU-level strategies. Digitalisation is, and will remain in the forthcoming decades, the main driving force of competitiveness. Only a ‘Digital Visegrad’ can maintain and improve the region’s competitiveness and economic strength. To this end, the V4 should also work together to address unjustified bar-

PRogRammE of thE huNgaRIaN PRESIDENCY of thE vISEgRaD gRouP 2017/2018

riers to free flow of data such as data localisation that throttle economies of scale and thwart the growth of V4-based companies that should compete on the European and global level. V4 countries play a significant role in the European automotive industry. To preserve and develop this position, priorities of the Presidency are the implementation of regional investments and joint projects, concerning especially the infrastructure, intelligent transportation systems, e-mobility, as well as connected and automated vehicles. A key priority of the Hungarian Presidency related to digitalisation will be the creation of a ‘Visegrad Good Practices Platform’ dealing with autonomous vehicle

The immediate and fundamental digitalisation of our education systems is inevitable in terms of the chances of emerging generations on the labour market. The Hungarian Presidency encourages all initiatives in the region that are aimed at improving digital skills. Digital skills are becoming the most important differentiators on the labour market. Competitiveness and employability depends on acquired digital skills. It must be a shared goal for V4 countries to set up a common understanding and description of digital skills, based on the Digital Competence Framework to achieve interoperability and mobility. However, it is of mutual interest to parallel develop digital industries in V4 countries to provide job opportunities to reduce brain drain.

on reciprocity. Another goal of the Hungarian Presidency is to deepen intra-V4 relations in the field of e-commerce by developing the cooperation between postal services.

manufacturing. The platform will provide opportunities for V4 SMEs with best practices to introduce themselves and present the best practices already available. Within this framework, R+D+I activities will be discussed focusing on three areas: production and manufacturing/ technology, product development, and the development of new types of services/business models (sharing economy). In the field of industry digitisation, the Hungarian Presidency will facilitate active regional involvement in the Commission’s Digitising European Industry (DEI) initiative (V4, Austria, Germany, Central and Eastern European countries), in terms of presenting national and regional projects, monitoring, best practices, and major projects enabling the dissemination of digital innovations. It is particularly important to focus on the topic of the analysis of big data generated by sensors of fastmoving vehicles, and the necessary cooperation between autonomous vehicles (5G edge computing). One of the most important goals of the Presidency is to continue V4 coordination connected to EU policies and legislative packages, concerning especially the work on the new Electronic Communications Code, the free flow of data initiative, the mid-term review of the European Digital Single Market Strategy and the possibility to lower the value-added tax amount on internet access services. Following the practice of former Presidencies of the recent years, the Hungarian Presidency is also planning to organise a V4+USA expert dialogue on policy issues concerning the emerging new technologies, and industry development plans. A separate discussion could take place to handle the concerns of tax collection being undeterministic for international companies selling virtual goods like advertisements or cloud services and for non-traditional, sharing economy business models.

The strengthening of the region’s ability to attract talents is a key factor in building start-up ecosystems. Therefore, it is the goal of the Presidency to encourage the development and strengthening of a modern, internationalised higher education sector, the launching of educational and training programmes in the sphere of Industry 4.0 focusing on the technological fields of data sciences and artificial intelligence, thus contributing also to intra-V4 mobility.

ation, and also during the formation of the next EU R+I Framework Programme. Selected issues negotiated in the Task Force: analysis of the initiatives on widening participation, identification of the biggest challenges

Key priority is given to the elaboration of EIT Digital Professional School Programs, and to student mobility building on them, as well as the creation of universitybased spin-off/start-up companies and the speeding-up of accelerator programmes strengthening the innovation ecosystem of the V4 region. The Hungarian V4 Presidency initiates the establishment of a ‘V4 Smart Platform’. Serving the comfort of the citizens and helping the public administration, the aim of the platform is the creation of interoperable eservices that can be jointly introduced in V4 countries. As a framework system supporting these services, the Platform can foster meeting public demand by the construction of a unified, cross-border digital space based

Science, technology, innovation and start-ups The Hungarian Presidency will coordinate the work of the Horizon 2020 V4 Task Force and continue the discussions with a view to facilitating a more successful Central European participation in the Horizon 2020 tenders. The Task Force’s main goal is to draw a V4 standpoint that is harmonized with the H2020 Programme, to define common interests. This allows taking a joint position during the Programme’s half-time evalu-

for increasing the share of EU–13 Member States in Horizon 2020; suggestions on the contents and instruments of the next EU Framework Programme (e.g. the amount of financial allocation, synergy with EU structural funds, thematic priorities); possibilities of opening up closed research/ innovation networks; strengthening the participation in wide-scope projects. To discuss the possibilities and the practical realisation of a V4 R+D initiative, the Presidency organises a V4 R+D+I conference (autumn 2017). The Hungarian Presidency will continue the ongoing science & technology cooperation with the Republic of Korea, Japan and the USA, including the organisation of joint scientific and innovation workshops and supporting common R+D programmes and projects. The Presidency continues the V4+Korea Knowledge Sharing Program whose common V4 topic for 2017-2018 is SME innovation. Hungary will assume an active role in implementing the V4 Start-up and Innovation Memorandum, including the

reinvigorating of the work of the V4 Innovation Task Force by involving experts and business actors. The goal of the Task Force will be to share the experiences of innovative national programmes supporting SMEs/startups; to share already established good practices in the field of regional cooperation; to realise joint promotion and network- building actions; and to facilitate the joint participation on workshops, start-up events, and fairs organised abroad. Taking into account the last Memorandum signed during the November 2016 Budapest Digital Summit, the Hungarian Presidency initiates the organisation of thematic workshops in the V4+Austria+Germany+Slovenia format, with the joint participation of start-up associations and angel investors of the region. The aim is to present the activities of regional start-ups to as wide of a circle of potential investors as it is possible. It is highly important to put industrial start- ups into position, and to strengthen B2B relations. Recalling, inter alia, the Warsaw Declaration of 28 March 2017, in order to facilitate cooperation among V4 start- ups, the Hungarian Presidency’s goal is to encourage the building of a regional start-up ecosystem with the help of intra-V4 start-up mobility, with the possible involvement of the International Visegrad Fund. The Hungarian Presidency will launch the event series ‘V4 Start-up and Innovation Days FastLane’ to discuss the role of the state in developing a V4 innovation ecosystem and the measures to encourage the development, events will be organised in the four countries in four topics throughout the series–this all is aimed at avoiding brain-drain affecting the region. In order to help convergence between the activities of digital start-ups as important economic actors in the V4 region and current demands of large companies, the Hungarian Presidency will organise events focused on research and development, with the potential involvement of Google. Within the framework of the International Visegrad Fund’s Strategic Grants, the Hungarian Presidency will support the 2018 instalment of the strategic conference think.BDPST – Connect to the Future on innovation and new technologies, in cooperation with governmental and non-governmental actors. At the community level, the European Commission’s ‘Urban Agenda for the EU’ Program brings together all activities of the ‘Smart City’ development activities that use various digital technologies in creative ways. The Hungarian Presidency wishes to encourage a more active V4 participation in the work of the Urban Agenda, and takes the lead in giving impulses to the cooperation.

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Hungarian Presidency supports the successful operation of the Visegrad Patent Institute, a joint V4 institution set up in Budapest in 2016, in terms of promoting its activities and achievements.

autumn of 2017. Jointly representing the regional interests concerning the future of the Common Agricultural Policy and Brexit is also a high-priority goal of the Hungarian Presidency.

Agriculture, environment and water issues In the past few years, EU Member States have faced significant challenges in the field of agriculture. Farmers had to face animal illnesses causing epidemics of magnitudes unseen before. The extreme weather conditions resulting from climate change have also added to farmer’s losses. The conclusions of the talks on Brexit influence greatly the future of the Common Agricultural Policy of the EU-

As regards water issues, the Hungarian Presidency, having regard to the review of the Water Framework Directive (Directive 2000/60/EC) due in 2019, continues the formulation of the V4+Bulgaria+Romania joint position, initiated under the Polish Presidency, in order to appropriately represent the regional interests of Central Europe on the EU forum. In the field of cooperation in water management, the Hungarian Presidency plans to extend the existing V4+2 framework to Austria, Slovenia

as its consequence, a completely new configuration will be created. Europe needs a Common Agricultural Policy that can provide effective solutions to tackling different crises, resulting in the European agricultural sector and food industry’s ability to remain a competitive player on the global level. The European Commission will present its proposals on the Post-2020 Common Agricultural Policy in the

Croatia and the Baltic states, namely in the following fields: • V alidating the aspects of water management and water protection in sectorial policies (e.g. agriculture); • Experiences of the practical application of environmental analysis according to Article 4, paragraph 7 of the Directive;

• P ractical experiences on water price policy formulation, and on the principle of cost recovery (Article 9 of the Directive), with a special fíocus on agricultural water management; • Experience-sharing of climate change adaptation regarding water management, drought treatment; • Issues in connection with responses to water damage, flood risk management, and their consistency with river basin management plans. Economy and society The goal of the Hungarian Presidency is to launch discussion on the balance of work and family and ‘family mainstreaming’. Regarding the EU Framework for National Roma Integration Strategies, the Hungarian Presidency proposes the deepening of professional contacts between the V4 countries, and–in the framework of European Roma policy cooperation–the sharing of experiences of experts and decision-makers of countries facing similar challenges concerning social inclusion. The aim of the Hungarian Presidency is to develop the financial consciousness of the citizens of the region, and to help and encourage the acquisition of financial knowledge. Our goal is to share the experiences and to exchange the best practices of national programmes.

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Concerning the protection of consumers’ interests, the Hungarian Presidency initiates negotiations and the sharing of best practices concerning measures related to consumer protection in e-commerce. In this field, the Presidency highlights especially the practices concerning the right of withdrawal from the side of consumers and enterprises, and between consumers (C2C). Besides, the Presidency's aim is also to consult on alternative methods (including online forms) of consumer disputes. 4. gloBAl visegrad V4+ partnerships and joint international activities The Hungarian V4 Presidency supports cooperation with global partners, inter alia in the framework of the V4+ sharing of best practices concerning measures related to consumer protection in e-commerce. In this field, the Presidency highlights especially the practices concerning the right of withdrawal from the side of consumers and enterprises, and between consumers (C2C). Besides, the Presidency’s aim is also to consult on alternative methods (including online forms) of consumer disputes. Formats included

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in this chapter, with a view to further improving the region’s visibility and possibilities in terms of foreign policy, economy and tourism. The past few years have shown that events in the Middle East and North Africa directly affect Europe and thus the V4 region. Having this in mind, the Hungarian Presidency will organise the first-ever V4+ summit with Egypt, an important regional actor with a stabilising role, and with Israel, a key economic and political partner for the V4 countries. The summits will be aimed at discussing global and regional challenges as well as possibilities of cooperation in the future. In the formats of V4+Japan and V4+Republic of Korea, the Hungarian Presidency will continue the successful political dialogue on foreign and security policy, the cooperation in the field of R+D, and the organisation of joint thematic events. Concerning the V4+Republic of Korea format, the Presidency will continue the sharing of Central European expertise in political transition, as well as the implementation of the Knowledge Sharing Program in the field of innovation. The Presidency will also facilitate V4 discussion on the North Korean nuclear and ballistic missile programme and will promote peace and stability on the Korean Peninsula. The Hungarian Presidency aims to strengthen V4+USA ties under the new US administration. Within the framework of the V4’s global activity, the Hungarian V4 Presidency initiates high-level consultation in the V4+Central Asia format. The Presidency continues the regular consultations at the level of Political Directors, especially with the following partners: countries of the Western Balkans, Turkey, USA, Canada, Israel, Palestine, Egypt, Japan, China and the Republic of Korea. The Hungarian Presidency initiates foreign policy planning dialogue in the format of V4+African Union to discuss Africa’s situation and its impacts on European security and stability. The Hungarian Presidency supports the joint examination of opportunities for V4 cooperation in Sub-Saharan Africa, e.g. in the fields of accessing EU development funds and jointly realising development projects. The Presidency also facilitates consultations on the V4 countries’ policies towards Africa. The Hungarian Presidency contributes to the common thinking on potential areas of cooperation with the Pacific Alliance, one of the most dynamic regional organisations of the Latin American region.

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The Hungarian Presidency supports the mitigation of the humanitarian challenges in the countries afflicted by the migration crisis as countries of origin, and will facilitate the discussion of potential common V4 projects. The main related goals of the Hungarian Presidency are: consultation on the role of V4 countries as emerging donors in international development; consultation about financial aspects of international development and humanitarian aid policy; providing assistance to forcibly displaced people living in and outside of refugee camps, especially in the region of origin; improving living conditions in countries of origin so as to prevent further migration crises; examining possible common steps in tackling root causes of migration (e.g. unemployment, lack of education and infrastructure); protection of persecuted Christian minorities. Tourism; promotion of the region The Hungarian Presidency aims to promote the Visegrad Group outside the region in terms of culture, economy and tourism. To further strengthen the V4 brand, the Hungarian Presidency will support holding V4-focussed business promotion events and side-events worldwide. Budapest will be the first V4 capital to host the World Export Development Forum (24–26 October 2017), a gathering of export development experts, politicians and business people, which will also provide opportunities to promote the V4. Within the framework of the successful V4 cooperation in the field of tourism, the goal of the Hungarian Presidency is twofold: to support adaptation to the new trends of tourism (the increased value of security, the growing role of social economy, the spread of innovative marketing tools); to strengthen and present the V4 brand in source markets, using an experience-based approach. Among the target markets of V4 tourism cooperation an emphasis will be put on the USA, Canada, potential source countries of Latin America, Russia, the former CIS countries, and the countries of Southeast Asia. Furthermore, the intention is to ensure a stronger and more focused marketing presence in China, India, the Republic of Korea and Japan, countries generating the most dynamic tourist traffic to the V4 region. After defining the consumer segments in our source markets more accurately, the Presidency proposes compiling and promoting experience packages for longer stays (7– 10–14 days) that also present the many faces of the V4. An important objective of the Hungarian Presidency is to further boost the intra-Visegrad tourist traffic. The main tool for this is the formation of joint product and package offers.

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THE EUROPE OF THE FUTURE IS EMERGING IN OUR REGION 104

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THE EUROPE OF THE FUTURE IS EMERGING IN OUR REGION Author: Márton Békés

We are living in an era of change. Ideas about the economy underwent fundamental changes after the Great Depression was triggered in 1929 – the first global production crisis; in the same way, the financial and real estate crunch of 2008 brought far-reaching consequences in its wake.

After the Great Depression, Keynesian economics replaced laissez-faire capitalism as the dominant approach; meanwhile in the later crisis, the neoliberal financial system based on stock exchange speculation and debt-circulation received a slap in the face from reality itself. The world of asset bubbles and financial derivatives lost every last drop of credibility. However, 2008 provided a much more profound lesson than did 1929. On the one hand, faith in the omnipotence of the market was shaken, and values such as hard work, thrift, predictability and security were upgraded. On the other hand, the economy’s internal structure also underwent notable changes, as the role of credit was replaced by that of work; the autonomy of the economy was replaced by the role of the state in protecting the interests of society. This was a reaction to the experience of previous decades: instead of creating prosperity on the basis of work, ruthless privatisation and chain-trading of fictive products had been the order of the day. As the lesson was learned, tangible things, well-defined interests and limits guaranteeing security were back on the global stage. In short, public interest became the priority. As always, the change started in our minds. There started to be open discussion of mistakes made by centres of financial planning and half-hearted crisis management by the international organisations controlling the world economy, as well as imbalances within the economy – such as disparities in the share respectively obtained by capital and labour of the value generated

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by each, and the ratio of foreign versus domestic capital. Open discussion dismantled the barriers blocking free opinion which had been raised by political elites who had declared the “end of history”, and who since the 1990s had allied themselves with neoliberalism. The ban on questioning their received wisdom, which had been in force for twenty years, had shaped a neoOrwellian Newspeak which declared certain expressions to be “politically incorrect”, and by so doing linguistically shackled any attempt to address problems. Therefore, when those problems manifested themselves more strikingly than ever before, people were unable to find the right words needed in the search for a solution. The revolt against the status quo started with a reconquest of our notions: by courageously referring to problems by their names. Characteristically enough, the two great surprises of 2016 were the election of Donald Trump and the Brexit vote. Pollsters, the mainstream opinion-dictating media machinery and “independent” pressure groups had declared in unison that the former would never happen; as for the latter, the day after the vote a leading British liberal newspaper was published with a front-page headline declaring victory for “Remain”. As opinion leaders moved within the old conceptual framework, they were unable even to imagine the possibility of a world that was different from theirs. But cracks appeared in their old world’s cultural hegemony, and on both of these occasions voters failed to follow the cues that were fed to them from above. This sig-

nalled a return of the majoritarian model of democracy, in which an elite jealously guarding its own privileges is rejected in favour of the nation deciding its own destiny. The people have once again become sovereign.

“A new consensus is emerging in Europe. The new Europe is emerging in the central and eastern parts of the continent.” A new consensus is emerging in Europe. For some years now, unaccountable and unelected leaders and remote bureaucratictechnocratic centres have seen an erosion of their power. In reaction they have ceaselessly but unsuccessfully attempted to stigmatise the new political forces as “populist”. In fact this term means that the latter are able to win the trust of the majority of the electorate and enact policies which are “people-friendly”: in other words, they use their legislative mandate within national borders and for the good of the people. Meanwhile, another process is also underway: at the expense of the supranational structures which strengthened alongside the popularisation of individual identity subsets, we are witnessing a renaissance of national communities – whether in the form of strengthening nation states or, in the other direction, in demands for ethnic autonomies. The electoral results in twenty-two European countries have proved that electoral support for so-called “right-wing populist” parties is higher than at any time over the past thirty years. In practice, all of this simply means that in certain areas the will of Warsaw, Prague, Bratislava and Budapest will prevail, rather than non-transparent and unaccountable decision-making in Brussels or Strasbourg. For reasons relating to history and the peculiarities of political culture, the new Europe is emerging in the central and eastern parts of the continent. The changes underway across the whole of Europe are appearing here sooner and are more sharply delineated than elsewhere. In a lecture at Harvard In 1978, four years after emigrating to the West, Alexandr Solzhenitsyn said the following: “A fact which cannot be disputed is the weakening of human beings in the West while in the East they are becoming firmer and stronger – sixty years for our people

and thirty years for the people of Eastern Europe. During that time, we have been through a spiritual training far in advance of Western experience. Life’s complexity and mortal weight have produced stronger, deeper, and more interesting characters than those generally [produced] by standardised Western well-being.” What the Russian Gulag survivor had in mind was that under the pressure of communism the lives and the independence of the peoples of Central and Eastern Europe were in constant danger; thus their desire for freedom and their respect for national traditions were perpetually aroused. Meanwhile the mortal danger of communism forged these people not only to be full of vitality but also to be united. Despite being in a decades-long hibernation during that political Ice Age, the central and eastern part of Europe – from the Baltic Sea to the Balkans, and from the line of the Oder, the Neisse and the Danube to the Dniester – was instilled with two striking qualities: a state of permanent defence; and a heightened immunity to ideologies and utopian temptations – including those of the present. Then, during the decades since the fall of communism, that historical experience has been turned to advantage, enabling the cooperation of the V4 countries to become Europe’s driving force. The fall of communism in 1989–90, when Hungary and its fellow countries in the region regained their freedom and independence, was followed by long years in which our country was trapped by communism’s burdensome legacy. Single party dictatorship was replaced by parliamentary democracy, planning directives by a market economy, and instead of forcible Soviet integration structures Hungarians could opt for NATO and the European Union; but the one-party state survived in our cultural codes, among those who pulled the strings in the public sphere and in the basements of public institutions. Hungary struggled for another twenty years before it started dismantling the post-communist

“Hungary struggled for another twenty years before it started dismantling the postcommunist structures, from 2010 onwards.” 107

structures, from 2010 onwards. It is since then that this country has been able to follow its own path, leading to the possibility of many innovative ideas and – more importantly – autonomous actions. Many people have found all this rather strange, others have thought it unusual, and quite a few wanted it to fail. But the Hungarian model has proved to be viable. When asked what we are like, we Hungarians tend to boast about our inventiveness, resourcefulness and shrewdness in problem-solving. This must be due to the great trials and the desperate times that the nation has been confronted with over the past centuries, and which have made deceiving hostile powers a necessity. Using our brains has been imperative for survival. This is the spirit in which Hungary stood on its own feet in 2010 and in which it is following a path indicated by the electorate. Over the past eight years the local solutions we have found for global challenges have gradually eliminated Hungary’s economic dependency, increased its diplomatic room for manoeuvre and given us ample reason for feelings of national pride. One of our first tasks was to create a modern constitutional framework for 21st-century Hungary. This goal was served by the new constitution (the Fundamental Law), which replaced the one originally imposed on the country in 1949 and amended several times since. The Government also guaranteed the country’s independence by reducing the negative impact of the mismanaged economic crisis and eliminating dependency and financial subordination. Getting rid of the public debt accumulated by previous governments and the settlement of forex debts contributing to society’s financial vulnerability were both motivated by the same consideration: a country accumulating debt cannot be truly independent. The same purpose was served when the Government took strategic infrastructure under public – or national – control. This was also true for the introduction of special taxes on multinational enterprises, financial transactions,

“The great discovery of the 2010s was the realisation that only a nation focused on work and families can be strong.”

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the telecommunications sector, advertising and public utility companies. Between 2010 and 2017 these special taxes amounted to 1.5 to 2 per cent of GDP. The great discovery of the 2010s was the realisation that only a nation focused on work and families can be strong. For this reason a series of measures was enacted to protect working people and families, and to promote their prosperity. Earlier neoliberal policies meant that wages had been lagging far behind productivity. Wages as a proportion of GDP had declined continuously, and thus Hungarian employees had become the main losers in the period between 1970 and 2010. The income restructuring transfers introduced by the Hungarian government resulted in a sharp correction of this process, and by 2017 Hungary had the highest wageoutput ratio among the Visegrád countries. In an effort to create a work-based society, VAT has increased to enable reductions in taxes on wages, while minimum wages, pensions and salaries in selected sectors have been substantially increased. The statistics are revealing: by 2017 4.5 million Hungarians were in work, while net real salaries had increased by almost 40 per cent from 2010 to 2017. Subsidies to families also became a priority, and a series of measures serving the goal of strengthening the most elementary unit of society comprised: efficient family support systems; encouragement for new housing and the commitment to have children; tax allowances for families with several children; and reductions in household utility charges. Overall, one million families have seen their positions alleviated as a result of family tax allowances, while from 2011 to 2018 the system of joint tax returns for married couples left 1,900 billion forints with families. The Government’s reductions in household utility charges enabled families across Hungary to save one trillion forints. Birth rates have been moving upwards from a historic low in 2010. Putting the country’s financial house in order naturally serves an aim which is far more important than the increases in income themselves: forming the culture of a robust nation. In addition, Hungary’s experience shows a work-based and a family-friendly society to be more competitive. Hungary is a fully-fledged European country, and within Europe it is a member of the family of the peoples of Central and Eastern Europe, who depend so much on each other. We have been living in the heart of Europe for one thousand years. We are proud of our past and the friends we have made. We continue on our path together.

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Viktor Orbán’s speech at the 28th Bálványos Summer Open University and Student Camp Welcome everyone. I shall briefly fulfil the pleasant duty of congratulating the Sepsiszentgyörgy team for having fought their way up to the top, to the first division. I’ll do this in my own way. First of all, I’d like to remind everyone that we started a process of collective thinking 27 years ago in Bálványosfürdő, a few kilometres from here. That is where we came to a realisation. Just think back: at that time, at the beginning of the nineties, most people – not only in Hungary, but also across the whole of Central Europe – thought that full assimilation into the Western world was just opening up to us again. The obvious approach was adjustment to that world: to in a way shed our skin and grow a new, fashionable Western skin. From this it followed that in our politics we would simply need to copy what they were doing in the West. Back then – 27 years, 28 years ago – we came together here, and we thought that we freedom fighters living on this side of the Iron Curtain could also have something valuable to say to a Europe which had by then been living in peace, freedom and prosperity for forty years. Back then we weren’t surrounded by television cameras, and our words commanded no attention whatsoever. Now, however, they do. And if I were to name the most important event, the most important Hungarian and European event of the past year – the twelve months since our last meeting – I would say that it is the

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strengthening of the Visegrád Four. Although there was a presidential election in the United States, and not so long ago the French presidential and parliamentary elections swept away the entire French party system – which are both important things – I’m convinced that the most important development of the past year has been the Visegrád Four cooperation becoming closer than ever before. We can say that Warsaw, Prague, Bratislava and Budapest are speaking with one voice. This is a great achievement, as these are countries which are very different in their characters. Here we have the enthusiastic Poles, the ever-cautious Czechs, the sober Slovaks and the romantic Hungarians; and yet we are able to speak the same language. We can be truly proud of this. It is customary for the Open University presentations to seek to give an account of the extent of change over the past year, also in a broader civilisational context. Certainly not everyone remembers that in 2009, after his election, President Obama made his first important speech abroad in the city of Cairo. This year the newly-elected US president delivered his first important speech abroad in the city of Warsaw. To illustrate the extent of the changes, it’s enough to quote a few sentences from the speech made by the American president in Warsaw. I’ll quote from it now: “We have to remember […] that the defence of the West ultimately rests not only on means, but also on

Viktor Orbán, Prime Minister – Tusnádfürdő, 22 July 2017

the will of its people to prevail and be successful and get what you have to have. […] Our own fight for the West does not begin on the battlefield. It begins with our minds, our wills and our souls. […] Our freedom, our civilization and our survival depend on these bonds of history, culture, and memory.” He then went on to say: “So together let us all fight like the Poles: for family, for freedom, for country and for God.” Ladies and Gentlemen, These words would have been inconceivable anywhere in the Western world two years ago. This is the extent of the change that is taking place around us. This, perhaps, is the point at which I should greet Piotr Naimski and the Polish delegation led by him. He is the President of the Hungarian-Polish Parliamentary Group in Warsaw. Welcome, Dear Polish Friends. Certain theories describe the changes now taking place in the Western world and the emergence on the stage of the US president as a struggle in the world political arena between the transnational elite – referred to as “global” – and patriotic national leaders. I believe that this is a meaningful description, and there’s much truth in it. If we relate it to ourselves, we can also say that back in 2010, well before the US presidential election, we were forerunners of

this approach, the new patriotic Western politics. We ran quite a distance ahead of the others, and in politics those who run further ahead are not greeted with recognition, but with something quite different. If they can endure it, however, they may well earn their recognition, just as Hungary is earning increasing recognition. The essence of the matter is that in this struggle – the struggle between political representatives of the global elites and political leaders and countries with patriotic feelings – Hungary is on the right side: on the side of patriots.

“In 2010 we Hungarians also decided that we wanted to regain our country, we wanted to regain our self-esteem, and we wanted to regain our future.”

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Ladies and Gentlemen, The question the US president was asking – and the one we also asked in 2010 – was this: What goal could patriotic governance have, other than to strengthen our own community, nation and country? In 2010 we Hungarians also decided that we wanted to regain our country, we wanted to regain our self-esteem, and we wanted to regain our future. Preparing for this speech today, I tried to summarise point by point what it is that makes a nation strong: what it is that constitutes a country’s strength in the world today. I identified around a dozen points. I’d like to briefly introduce these to you, to demonstrate the distance that Hungary has covered since 2010 on the path of consolidation. First of all, a strong nation and a strong country doesn’t live on someone else’s money. Therefore it thanks institutions like the IMF for their help, and bids them farewell: it sends them packing, and hopes that they will never have to meet again.This is what took place in Hungary. Don’t forget, before 2010 the socialist governments hooked Hungary to an IMF life support unit. The trouble with life support machines is that while there’s no doubt that they aid survival, the patient is physically tied to them. After 2010 we

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managed to solve this problem, and as a result Hungary achieved a breakthrough in perhaps the most important aspect of strength: financial independence. A strong country is one whose finances are in order. No country is strong if its budget deficit is excessive; no country is strong if its businesses are at the mercy of creditors; and no country is strong if its population has been lured into debt traps, such as the ones that Hungarians found themselves when they took out foreign currency loans. Step by step Hungary managed to address all these issues. A strong country has sound economic performance. In the modern world this is described by resort to the term “GDP”. If there is growth, there is a strengthening economy. Today economic growth in Hungary is around twice the European Union average. A country is strong if it’s able to provide jobs for everyone who wants to work. Few countries in the world today are capable of this. We are one of them. I’d like to quote some figures on this. In 2010, out of a population of ten million, three million six hundred thousand Hungarians people were in employment, and one million eight hundred thousand paid taxes. It was nothing short of a miracle that we managed to survive. Today in Hungary four million four hundred thousand people are in work, and four million four hundred thou-

sand pay taxes. This is another reason why Hungary is financially strong. A country the size of Hungary – not the size of Germany or the United States, but similar in size to us – can only be strong if there is robust majority national ownership in the strategic industries which determine its fate. This wasn’t the case in Hungary before 2010. Now, however, we can say that there is clear majority national ownership in the energy sector, the banking sector and the media sector. If I had to quantify this, I would say that in recent years the Hungarian state has spent around one thousand billion forints on repurchasing ownership in strategic sectors and companies which had previously been foolishly privatised.

billion forints from the banking sector; 31 billion from insurance corporations; 120 billion forints from the energy sector; and 55 billion forints from the mass communications, the telecommunications industry. This all comes to around 500 billion forints annually. Then we take this money and distribute it as follows: 272 billion forints in the form of family tax allowances to working people raising children; 74 billion forints for free children’s meals; 5 billion forints for holidays for children in need; free school textbooks – I can’t give you the precise figure, because its continuously increasing; and 210 billion for housing allowances supporting parents raising children.This is what adds up to demographic policy, the family support policy

For a country to be strong, demographic decline must be out of the question. At this point in time, this is Hungary’s Achilles heel. A country which is in demographic decline – and, to put it bluntly, is not even able to sustain itself biologically – may well find that it is no longer needed. A country like that will disappear. Only those communities survive in the world which are at least able to sustain themselves biologically; and let’s be honest with ourselves, Hungary today is not yet such a country. We must also admit that on demographic issues – the creation and growth of families – the hands of the government of the day are tied. This is because no policies of any kind can decide whether or not there will be children in a community, whether children are being born into families – and if so, how many. This is because only women can make such decisions. Things will be what women decide them to be.

that I’m talking about. In practice the funds for this were not previously available.

So what can a government do? A government can do one thing: seek to create a family-friendly environment. In this context there is an important fact we don’t usually talk about, but perhaps I’ll do so now – maybe the occasion will allow me to do so. Many of you may have noticed that in Hungary we spend an enormous amount of money on the promotion of families, in the interest of a strong Hungary. The question is this: where does that money come from? The truth, Ladies and Gentlemen, is that we take this money from multinational companies. If it wasn’t immodest, I could also say that I take it from the multinationals, because at the outset not many people other than me were in favour of this fine move. So we take this amount out of the profits of multinational companies in the form of a number of special taxes, and we then give the money to families raising children. The annual amounts we take – and now I’m referring to this year and last year – are as follows: 272

When Zsolt Semjén says that the Hungarian government is Europe’s most Christian democratic government, this is what you should bear in mind. We take part of the large profits being generated in order to give it to those who are both working and raising children – and thereby providing for the future of the nation. If we speak about a strong country, we must also mention public security. Today this means two things in particular: defence of the borders, and the ability to prevent terrorist attacks. There is no strong culture without a cultural identity.

“If we speak about a strong country, we must also mention public security. Today this means two things in particular: defence of the borders, and the ability to prevent terrorist attacks. There is no strong culture without a cultural identity.”

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Ladies and Gentlemen, However much of a taboo one is breaking by saying it, there is no cultural identity in a population without a stable ethnic composition. The alteration of a country’s ethnic makeup amounts to an alteration of its cultural identity. A strong country can never afford to do something like that – unless some global catastrophe forces it to do so.

“In the modern world there can be no strong community or strong state in a country without growth in science and innovation, and without the ability to open up to the industries of the future.” Ladies and Gentlemen, In the modern world there can be no strong community or strong state in a country without growth in science and innovation, and without the ability to open up to the industries of the future. I’m not saying that we’ve already arrived at this position, but over the past seven years we’ve at least knocked on the doors of the new industries of the future. In our case there will be no strong Hungarian community and no strong Hungarian state if we’re unable to rally Hungarians around the world into a single community. Without going into detail, I’d just like to say that Hungary can only be strong if it is organised in such a way worldwide that whenever in any part of the world a Hungarian has their toes trodden on simply because they are Hungarian, a red light flashes in Budapest. Once we’ve achieved that, then Hungary will be a strong country. Ladies and Gentlemen, Hungary is also strengthened by being part of stable alliances, as a member of the European Union’s huge single market and also of NATO, the world’s largest military power. Bishop Tőkés mentioned the World Aquatic Championships. I don’t want to talk about that event now, but rather about the fact that another precondition for the strength of a modern state and community

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is that it should be able to host the world’s great events. Looking at Budapest, we can see that from Vienna to Istanbul it is the point – perhaps the only point – which can claim to be a cultural creation. This is because Budapest – as you well know – is not just a city, but a Hungarian cultural creation: an imprint of the Hungarian genius embodied in architecture and city planning. So Budapest is the place which is currently proving to itself and the world that there’s no world event – be it a sporting or cultural event, or a religious event such as the International Eucharistic Congress – which it couldn’t host. Apart from the FIFA World Cup, which is another matter, there’s no major world event that is beyond Budapest’s capa-

perative which is implicit in this. So in the area of demography we need a shift in scale, and development at a higher rate. I believe that this is what we need in terms of the nation’s organisation. In the period ahead we must dramatically intensify organisation of the Hungarian community in the Carpathian Basin – and in particular its economic strength. And the third area in which we need a shift in scale is integration of modern technology into the Hungarian economy. To do this we must participate in the new industrial revolution much more actively than we do at present.

bilities. This is great knowledge, great strength, and a major promise for the future. I could also say that our capital is capable of more than just serving the Hungarian state.

So much for Hungary. Now I would like to say a few words about Europe. I apologise if today I seem to be dealing solely in simplifications. It’s not that I’ve lost my appetite for intellectual nuance, but the fact is that it is also possible to talk about these things in such simple terms.

There’s one other thing, Ladies and Gentlemen, which we need for strength, and that we only have to a limited extent: it’s called an army. While concentrating our resources on surviving the economic crisis of recent years, we’ve failed to develop our armed forces. In a few years’ time, when we talk about the strength of Hungary, and whether the Hungarian nation is strong, I’m sure that we’ll also be able to add to our list of arguments a strong Hungarian army: an army that will be able to defend Hungary from all external attacks. This is why we’ve launched an armed forces development programme, and have recently started construction of the first factory for the Hungarian arms industry. Ladies and Gentlemen, For the future, we must support all these processes. There are three areas in which it is not enough to support processes, but in which we need a shift in scale, and the move to a fast track. One area is demography, in which we haven’t even reached a break-even point. It is some improvement that for married couples – or male-female couples in general – the fertility indicator expressing the nation’s demographic situation has risen from 1.2% to 1.44%, and this is promising, but 1.44 is still very far from 2. In order to feel safe demographically, the average statistical ratio of children to Hungarian couples should be 2.1. In practice this is hard to implement, but this is the average figure we should have. Until we reach that point, Hungarians must be seen as an endangered species demographically; and the people – but the Government above all – should understand the im-

Ladies and Gentlemen,

Hungarians? Will Germany remain the country of the Germans? Will France remain the country of the French? Or will Italy remain the country of the Italians? Who will live in Europe? This is a historical question which we must face up to today. As regards the specific situation – and this is quite telling about the world that we live in today – there’s no concrete, reliable information on the percentages of traditional indigenous Christians and the incoming Muslim communities living in Europe’s individual countries. In practice it is forbidden to gather information like this. And the data which is gathered is not adequate for us to predict what the future holds for us, as migrants, immigrants, are not evenly distributed throughout the different age groups. So the general figures say little about what awaits us. We should focus most on people under the age of 15, and also those between 15 and 45. From those figures we can project, we can calculate, what the situation will be like in each country in, say, 2050.

“Over the next few decades the main question in Europe will be this: will Europe remain the continent of the Europeans? Will Hungary remain the country of the Hungarians? Will Germany remain the country of the Germans? Will France remain the country of the French? Or will Italy remain the country of the Italians? Who will live in Europe?”

Sparing no money and effort, every year the Hungarian government commissions an extensive international survey in order to find out what the European people think about these issues. This is not about what their leaders think, because we know that. The suspicion is that the opinions of the people don’t coincide with those of their leaders. This year’s survey showed that, across the 28 European Union countries, 81% of EU nationals thought immigration to be a serious or very serious issue. At a pan-European level, 64% believe that immigration leads to increased crime, and 59% believe that immigration changes the culture we live in. As regards the performance of Brussels, 76% of European nationals say that Brussels’ performance on immigration is poor. When asked whether more power should be given to Brussels to resolve this situation, or if nation states’ powers should be strengthened instead, we find that 36% of European citizens expect a solution from Brussels and would give it more power, while 51% expect nation states to provide solutions. In Hungary, 25% of our fellow citizens – and this is not an insignificant number, as we’re talking about every fourth Hungarian – believe that more power should be given to Brussels. But luckily 61% of our fellow citizens think that Brussels should have less power, and we should even take back those powers that we previously transferred to it – or at least some of them.

Over the next few decades the main question in Europe will be this: will Europe remain the continent of the Europeans? Will Hungary remain the country of the

Naturally, when considering the whole issue of who will live in Europe, one could argue that this problem will be solved by successful integration. The reality,

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“In European culture the end to be achieved is for the people born into that culture to live in peace, security, freedom and prosperity, in line with their own values and beliefs. ” end. In European culture the end to be achieved is for the people born into that culture to live in peace, security, freedom and prosperity, in line with their own values and beliefs. This is the end, the goal of European culture. Solidarity is just a means to that end. The means cannot be substituted for the end. What is the conclusion to be drawn? It is that we can never show solidarity with ideologies, peoples and ethnic groups which are committed to the goal of changing

however, is that we’re not aware of any examples of successful integration. It’s obvious that migration is not the answer to economic problems and labour shortages. Interestingly, people in Europe are least concerned about migrants taking their jobs. This probably reflects some form of personal experience. I can believe there are desperate situations, just like a castaway on the ocean finally giving in to the urge to drink seawater: it’s water, but it doesn’t quench one’s thirst, and only adds to the problem. This is more or less the situation in which those who want to cure their economic ills with immigrants will find themselves. In countering arguments for successful integration, we must also point out that if people with diverging goals find themselves in the same system or country, it won’t lead to integration, but to chaos. It’s obvious that the culture of migrants contrasts dramatically with European culture. Opposing ideologies and values cannot be simultaneously upheld, as they are mutually exclusive. To give you the most obvious example, the European people think it desirable for men and women to be equal, while for the Muslim community this idea is unacceptable, as in their culture the relationship between men and women is seen in terms of a

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the very European culture which forms the essence, meaning and purpose of the European way of life. We must not show solidarity with groups and ideologies which oppose to the aims of European existence and culture, because that would lead to surrender. Here I should add that, while we don’t want to get involved in the German election campaign, there are some German politicians who are doomed to fail – and now teetering on the verge of complete defeat – who hope to achieve some improvement in their popularity by making mischief at the Hungarians’ expense, by provoking us and insulting us, and accusing us of a lack of solidarity. In fact I could even see this as a compliment. At this point I should perhaps add two things. The first is that Hungary has defended itself – and Europe at the same time – against the migrant flow and invasion, and this has cost us 260–270 billion forints. The EU has reimbursed a tiny fraction of this sum. I could also say that the EU shouldn’t speak of solidarity until they’ve paid the 250 billion forints that they owe us for defending Europe. Until then, I suggest that they exercise more modesty. Similarly,

hierarchical order. These two concepts cannot be upheld at the same time. It’s only a question of time before one or the other prevails. Of course one could also argue that communities coming to us from different cultures can be re-educated. But we must see – and Bishop Tőkés also spoke about this – that now the Muslim communities coming to Europe see their own culture, their own faith, their own lifestyles and their own principles as stronger and more valuable than ours. So, whether we like it or not, in terms of respect for life, optimism, commitment, the subordination of individual interests and ideals, today Muslim communities are stronger than Christian communities. Why would anyone want to adopt a culture that appears to be weaker than their own strong culture? They won’t, and they never will! Therefore re-education and integration based on re-education cannot succeed. Ladies and Gentlemen, There’s a question which frequently emerges in European politics: the question of solidarity. First of all, I’d like to make it clear that in European culture solidarity is not an end in itself, but merely a means to an

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a German in particular should think five times before accusing the Hungarians of a lack of solidarity. If I were German, I would think five times before using that word to attack Hungarians, as factory workers in Germany receive five times as much pay as Hungarian workers doing the same jobs in German-owned factories in Hungary. So for as long as this is the case, I believe that it is shameful for the Germans to talk about solidarity. in addition to all this, I believe that this is an unfortunate and misguided debate, because it runs counter to the logic of mutual investments, capital flow and job creation prevailing in the European Union. So it’s also incompatible with one of Europe’s values. At any event, Ladies and Gentlemen, If the picture that I have drawn for you is not distorted, but faithfully reflects reality, after this we must now assess its consequences for the political elite. Well, I have to say that in Brussels an alliance has been forged against the opinion of the people. The members of this alliance are the Brussels bureaucrats and their political elite, and the system that may be described as the Soros Empire. This is an alliance which has been forged against the European people. And we must recognise that today George Soros can pursue his empire’s interests more easily in Brussels than he can in Washington or Tel Aviv. This is why he has formed an alliance with Brussels. As usual, when the leaders – when the members of the great political elite – turn against their own people, there is always a need for inquisitors to launch proceedings against those who voice the opinion of the people. In our earlier four-year term, the European Union had a grand inquisitor, and her name was Madame Reding. That grand inquisitor failed, and now they’ve found a new one: the new grand inquisitor’s name is Timmermans. He is a commissioner. It give us little satisfaction to see that the grand inquisitor’s energies are inadequate for two countries at the same time, and so now he has devoted himself to Poland instead of us. But at this point in time, Poland is chosen as the inquisition’s main target in order to weaken, to destroy, to break national governance. I’d like to make it clear that Hungary naturally pursues its own national interests, but these interests include Europe and PolishHungarian friendship; and we must make it perfectly clear that a campaign of inquisition against Poland will never succeed, because Hungary will resort to all the legal mechanisms offered by the European Union in order to show its solidarity with the Polish people.

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What follows from this, Ladies and Gentlemen? First of all, it follows that we must see things clearly and we mustn’t overcomplicate things. We mustn’t think of the struggle facing us as being against a global conspiracy, but we should describe it and consider it in the most reasonable manner possible. This is how it is: there is a Soros plan. It comprises four points. He wrote it down himself, the Soros Empire published it and began recruitment for implementation of the plan. The plan says that every year hundreds of thousands migrants – and, if possible, a million – should be brought into the territory of the European Union from the Muslim world. The second point is that upon arrival every one of them should be given an amount in euros equivalent to four and a half million forints. The author of the plan would gladly finance this – but that is secondary, although it’s something that’s worth pondering. However, it’s not this, it’s not the business profit that’s the essence of the proposal, but the fact that in this way it’s possible to maintain a continuous influx. So those who want at least a million migrants to come in every year must maintain this mechanism – which in European political terminology is called a “pull factor” – so that they continue to come. And if they distribute them and everyone receives a sum – which is, in fact, higher than the Hungarian annual average wage – there won’t be a problem with reduced flow. The third point in the Soros plan is that the migrants arriving on the continent will have to be distributed among the countries of Europe as part of a mandatory and permanent mechanism. The fourth point is that a European immigration agency should be set up which will take all the decision-making powers related to migrant affairs away from the nation states and raise them to the level of Brussels. This is the Soros plan. Now if we speak about the future of Europe, we must first state in no uncertain terms that in order for Europe to be able to survive and remain the Europeans’ continent, the European Union must regain its sovereignty from the Soros Empire. Until that happens, we have no chance of retaining Europe for the European people. After that, once we’ve regained our sovereignty we should reform the European Union. This is not the main topic of my speech today, and so I’ll only talk about it in general terms. The first and most important thing is that the European Union’s so-called Commission should be redirected to the role designated for it by the Treaties which founded the European Union itself. The Treaties clearly stipulate that

Viktor Orbán, Prime Minister – Tusnádfürdő, 22 July 2017

“Now if we speak about the future of Europe, we must first state in no uncertain terms that in order for Europe to be able to survive and remain the Europeans’ continent, the European Union must regain its sovereignty from the Soros Empire. ” the Commission is not a political body. It has a single task, a task which makes it a kind of watch dog: it is the custodian of observance of the Treaties. Therefore, although the nation states delegate commissioners to the Commission, after this their national links are broken, and for as long as they are in the Commission these people are required to ensure that the European Treaties are observed. This is not happening today. The situation today is that the Com-

mission defines itself as a political body. President Juncker himself said that he will establish a political body which will play a political role. This is the source of all the problems, all the problems suffered by the nation states in the European Union today. This is why, despite my veto of the migrant relocation quota system in the Council of Prime Ministers – where unanimity is required – the Commission manipulated the system by starting a legal procedure which could be approved with only four fifths of the votes of the Member States; and so my single veto, Hungary’s veto, didn’t count. We were cheated and deceived, and they shook the foundations of trust which had previously been the common base of the 28 prime ministers of the European Union. This is the political role which the Commission should immediately withdraw from. Once this is done, we must make it clear that the reform of Europe can only start with stopping the migrants, putting an end to immigration, and everyone using their national competence to protect their borders. After that, as part of a joint programme the migrants who have already arrived in Europe illegally must be transported back to some place outside the territory of the European Union. This sounds harsh, but those who came in illegally must be transported out of the territory of the European Union. Once that’s done, we need to acknowledge that the British are leaving the European Union, and taking one of the world’s largest armies out of the Europe-

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an Union. And while we are strengthening cooperation within NATO, we must realise that the European continent must not be left militarily unprotected, and that it cannot hope for protection from anyone else. The presence of the Americans is important and NATO membership is important, but Europe must have its own military capability with which it can protect itself. In other words, we must start building a European military force. Parallel with this, we must realise that in the world economy the economic competitiveness of the European Union is in continuous decline. We must restore our competitiveness. This means reducing debt, and introducing flexible terms of employment. Once we’ve done that, our Western European friends, who are tired of enlargement, must frankly admit that there will be no peace in Europe without the full EU integration of the Balkans. We must therefore enlarge the European Union, and must first of all admit the key state, Serbia – however absurd this idea may appear at this point in time. And once that’s also done, we must conclude two overarching, historical agreements which have economic, military and political dimensions. We need a historic agreement with Turkey, and we need another historic agreement with Russia. Once all that’s done, we can say that we have reformed the European Union, and that over the course of the next few decades it may be able to compete with the world’s other continents. Ladies and Gentlemen, In summary, where do we stand in Europe today? My summary conclusions are as follows. Christian democratic parties in Europe have become un-Christian: we are trying to satisfy the values and cultural expectations of the liberal media and intelligentsia. The second important aspect is that left-wing politics has lost ground, and the social democratic parties are themselves no longer social democratic. They have lost the proletariat, if I can put it that way. The numbers and power of organised labour have fallen, mostly because many industrial jobs have been relocated outside the European Union, and therefore not even social democratic parties are what they once used to be. They’ve married themselves to global business interests representing neoliberal economic policy, and now they have a single policy area, they’re concentrating on a single area: preservation of their influence over culture. This is the second important element in Europe today. And the third important thing is that Europe is currently being prepared to

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hand its territory over to a new mixed, Islamised Europe. We are observing the conscious step-by-step implementation of this policy. In order for this to happen, for the territory to be ready to be handed over, it is necessary to continue the de-Christianisation of Europe – and we can see these attempts. Priority must be given to group identities rather than national identities, and political governance must be replaced with the rule of bureaucracy. This is the aim of Brussels’ continuous and stealthy withdrawal of powers from the nation states. This is the situation in Europe today, Ladies and Gentlemen. This is the battlefield on which Central European countries are fighting today. Finally, I’ll come back to our own homeland. This is our last Tusnádfürdő meeting before the next general election in Hungary. This is all very well – and even if it’s not, that’s the way it is. In a good scenario, what I’ve just said is an accurate description of the state of Europe and the world, and the changes that have taken place. But for us the upcoming Hungarian election takes priority, here and now, above everything else. I’d like to say a few words about this now. What is at stake in the next Hungarian parliamentary election? First of all, I’d like to say that the Hungarian election next year could be special because it will also have consequences for Europe. We shouldn’t forget that Hungary – with the aid of the V4, for which we are grateful –was the country which stopped the migrant invasion flooding into Europe. And I made it clear earlier, and I’ll repeat this now: for as long as I am the Prime Minister of Hungary, at the head of the Fidesz and Christian Democratic government, the border fence will remain in place and we shall protect our borders. And in doing so we shall also protect Europe. In contrast to this, the opposition in Hungary openly states that they’ll dismantle the fence and let immigrants into the country. They will agree to the full and mandatory distribution of migrants in Europe, and in this sense they’re ready to consign Europe to a new European future with a mixed population. This contrast between the Hungarian opposition and the Hungarian governing parties illustrates what is at stake for Europe in the next election. There’s another debate that adds to the stakes for Europe, and in which there’s also a sharp dividing line between the Hungarian governing parties and every Hungarian opposition party. This centres on whether we should give power to Brussels. We take the view that Brussels must restore to us

the powers which they have taken from us by stealth – and which, I think, they swindled from us illegally. By contrast, the opposition – whether the socialists, the far right or the liberals – all say that we must give Brussels more power, because on the big questions there are only European solutions, common European solutions. This means that they want to hand over to Brussels increasing power over the direction of the country. This also lends a European dimension to the Hungarian parliamentary election. But in our election the stakes will also be high for Central Europe. You can see that both the Brussels bureaucrats and George Soros have a vested interest in weakening Central Europe, as today the primary obstacle to implementation of the Soros plan is that on Hungary’s southern borders we closed the migrant land routes leading to Europe. Then the Serbs also closed their southern borders, and so did the Macedonians. With support from the V4, we are the obstacle to implementation of this plan. There are therefore forces in Europe which want to see a new government in Hungary replacing the current Hungarian government, because this is how they could most seriously weaken the V4. And we should be under no illusions: unless a Christian democratic government is formed in Hungary, the next government will weaken the V4, and will thereby weaken Central Europe. Consequently, there is also much at stake for Central Europe in the Hungarian election. And finally, there is also something at stake for the Hungarian people in the Hungarian election. At the beginning of my speech I pointed out what we should do in order to strengthen Hungary. I won’t repeat that, I won’t go into detail, but all I’ll say is that if the Hungarian civic, national, Christian forces don’t win the next election, we could lose everything that over the past few years Hungary has worked so hard for – with blood, toil, tears and sweat. And this means, Ladies and Gentlemen, that for the Hungarians, in Hungary, an era could return which is one of destruction, rather than of building. One shouldn’t forget that to build something is a difficult process which takes a long time, while destroying something is easy and can be achieved quickly. I can now tell you objectively that not since the Treaty of Trianon has Hungary been as close as it is today to regaining its strength, prosperity and prestige as a European country. And not since Trianon has our nation been as close as it is today to regaining its self-confidence and vitality. And I’m also certain that if Hungary once again has a government

that serves foreign, global interests, the Hungarians could again lose this historic opportunity – not just for a single election cycle, but for decades. Ladies and Gentlemen, If our Hungarian community is in danger in the motherland, if Europe is in danger in Hungary, what will happen to the Hungarians beyond the borders? A strong motherland is the most important precondition for the success and survival of Hungarian communities living beyond today’s Hungarian state borders. Parties which weaken the motherland will also be unable to offer good policies, opportunities and a future to the Hungarian communities living beyond our current borders. They are not your friends, Ladies and Gentlemen. I therefore ask everyone to register and to vote in the election. Please don’t just support your team from the sidelines, but run onto the pitch – because now you also have a say in the outcome of the Hungarian election struggle. And finally, I should also say a few words about our opponents, because this time our real opponents will not be the domestic opposition parties. Everyone can see that in recent years a strong and determined unity on national affairs has been forged; in the sophisticated language of politics, we’ve called it the “central field of power”. The opposition parties don’t know how to cope with this field of power, with this national unity. In the campaign facing us we’ll primarily have to stand our ground against external forces: in the next nine months we’ll have to stand our ground against Soros’s mafia network and the Brussels bureaucrats, and the media operated by them. We know their methods, and in this they can’t have too many surprises in store for us: financial blackmail, political threats, this report and that report, media campaigns, smear campaigns, infringement procedures, this article and that article. We have been subjected to rhetoric which has been coarse, and at times demeaning. We should also note, however, that Hungary has defended its own interests and has given answers in a calm and civilised manner – indeed, I could say, in a European style. During the election campaign I’m convinced that we’ll also be capable of this. In summary, I can close my speech with a single sentence. Twenty-seven years ago here in Central Europe we believed that Europe was our future; today we feel that we are the future of Europe. Thank you for your attention.

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HUNGARY ON THE PATH TO ECONOMIC CONVERGENCE

12 turnarounds in economic history since 2010 Author: GyĂśrgy Matolcsy â&#x20AC;&#x201C; Governor of the Central Bank of Hungary MAJOR TURNAROUNDS

Hungary has implemented twelve great turnarounds recently, and has launched the thirteenth one, which means a turnaround in competitiveness. Hungary has made good use of earlier, traditional and non-traditional instruments of economic policy. Changes of an economic historic scale have taken place, which have also required structural reforms.

From June, 2010 the crisis was being managed successfully in Hungary, and then the country managed to return to its growth trajectory. At the beginning of the first cycle, between 2010 and 2014 structural reforms were launched, with the most important ones taking place in the first two years. The Hungarian reforms stabilised the economy and facilitated the growth turnaround simultaneously. This is the outcome of a logical sequence; first, a budgetary turnaround was completed, then a monetary one, and now a turnaround in competitiveness is taking place.

complete the turnaround in its economic history without austerity measures. The Hungarian actions did not build the policy on austerity measures; this is one reason why the employment turnaround could have been completed so successfully. PROMOTING WORK AND SAVINGS The next great turnaround was completed in the taxation system by introducing single-rate taxing and incorporating family policy allowances.

The turnaround in the labour market is one of the most important ones of the twelve great turnarounds, since the country has achieved impressive results in this field. Our unemployment rate is one of the best ones in Europe and employment has increased considerably. Hungary has managed to

Without the turnaround in the taxation system, no other turnarounds would have taken place, either. In the taxation system, burden-sharing has shifted from taxes on work towards taxes on consumption. Regarding the budgetary turnaround, the primary budget balance has been positive since 2012. There has also been a significant decrease in government debt, and the excessive deficit procedure for

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12 turnarounds in economic history since 2010

Hungary was closed. The monetary turnaround could have been built on all of these turnarounds. The base rate of the Central Bank plunged to a historical low, resulting in a significant decrease in the interest rates of government securities. For this single reason, the budget had savings of HUF600 bn in 2017.

The conversion of foreign currency-based loans into HUF was a significant structural reform, reducing household debts by HUF1,000 bn. The Central Bank of Hungary completed a turnaround of narrowing the balance sheet of the Central Bank with a lending turnaround simultaneously taking place and the base rate being reduced. This was not typical in the world.

HUNGARY IS IN THE GLOBAL FOREFRONT

LENDING STARTED The lending turnaround has also taken place, although it was the most difficult task, as the lending market practically froze in 2013. By introducing the Growth Loan Programme, the credit expansion of SMEs was fuelled, and then this impetus has been successfully maintained. In the coming years, credit expansion might remain in the 5 to 10 per cent zone, which is a sustainable track.

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There has been a growth turnaround in the Hungarian economy, therefore expansion has been above two per cent since 2013. Hopefully, growth will be above 3.5 per cent this year. Hungary entered the crisis by giving up our convergence trajectory, but we could not be sure of returning to it after the crisis had been managed. After the growth turnaround, a convergence turnaround has also happened. Our country is still at the very beginning of the turnaround in competitiveness, but after twelve plus one turnarounds we can say that all adjustments made after 2010 have contributed to all the changes.

Regarding the objective variables of the World Economic Forum, the Hungarian competitiveness index has not deteriorated, but in the case of the subjective ones it has. If we apply objective indices, such as measuring the changes in the labour market, Hungary’s progress is obvious. We are leaders in research and development within the Visegrad Group. The Economic Complexity Index suggests that Hungary is in a very favourable position. This Index has been developed by Harvard and MIT. According to this Index, Hungary ranks number eight in the world, while we were only number fifteen in 2007. From the region, the Czech Republic and Austria are also included in the top 10. Parallelly, the economic complexity of the EU has deteriorated, while that of the Central European region has improved. If Hungary is able to implement competitiveness reforms in the coming years, the country will face a very promising future.

“Hungary has implemented twelve great turnarounds recently, and has launched the thirteenth one, which means a turnaround in competitiveness. Hungary has made good use of earlier, traditional and non-traditional instruments of economic policy.”

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12 turnarounds in economic history since 2010

medium-sized ones, and the participation of almost 40,000 SMEs in the Growth Loan Programme is also a very important achievement. Baden-Württemberg is a very good example: its 14,000 medium-sized enterprises are innovative and creative, constituting the backbone of the economy. In Hungary, however, currently there are only 4,600 strong medium-sized enterprises; if their number is multiplied by 2.5-3 times, Hungarian GDP is likely to grow significantly. Importantly, Hungary is implementing an opening to the East and to the South, as well as participating in building the Silk Road, since an increasing share of the Hungarian economic output will be generated in the future through relationships with regions outside the European Union. Presentation by György Matolcsy, Governor of the Central Bank of Hungary A NEW GOLDEN AGE – A KNOWLEDGEAND CAPITAL-BASED ECONOMIC MODEL IS TO BE FOLLOWED The Scandinavian economic model could be a model for Hungary to follow because they are progressing towards a knowledge-based economy after a labour- and a capital-based one. From 2010, the country has been taking again such a road at the end of which the age of prosperity, a new golden age can come in Hungary, partly because we have implemented the most effective crisis management in the European Union, facilitating a growth turnaround. The Southern European economic model is not an example for us anymore, as high levels of indebtedness and unemployment cannot be examples; for the Central European countries of the Union, the Scandinavian model is an example to be followed: they shifted towards a capital-intensive phase after the employment rate was raised and the economy is knowledge-intensive; these models are successful and serve as examples for Hungary as well. Economic science today agrees that ideas are important in addition to realities as thoughts create reality. In Hungary, the mindset must be changed, because capital is a nice thing to have, profit is also a nice thing to have, the Hungarian state appreciates

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money, capital, and profit; it must be put in its proper place in our mindset – money generated from activities benefiting the community is a nice thing to have. In Hungary, competitiveness has improved since 2010, as global rankings do not take any more factors into account; 90 per cent of the researches made by the Central Bank of Hungary are based on facts, while half of the major international rankings examine partly subjective factors.

After the financial and growth turnaround completed after 2010, Hungary is in the phase of sustainable catching-up, while the budget deficit is around two per cent. This financial balance is attributable to – among other things – the tax reform, the Hungarian crisis management measures, and the turnaround in monetary policy. The main point of the latter one is that, as opposed to several major central banks, the Central Bank of Hungary, has introduced a so-called balance sheet narrowing, so that money should not be left

“parking” at the Central Bank – in two-week bonds of the Central Bank of Hungary, for example – but it should be circulated in the economy, and be provided as loans to corporate and private customers by the banks. The global economy has entered the age of abundance, as, among others, emerging Asian economies are gaining strength and money is cheap owing to base rates of around zero per cent. This is a kind of “golden age” – it already came in Hungary under kings Charles I and Louis, the Great in the sense that most of Europe’s gold was produced in Hungary, and we were also leaders of silver production. For the Hungarian economy – instead of failed South European crisis management –, the economic model of Scandinavian countries might set an example, because these countries are progressing towards a knowledge-intensive economy after a labour- and then a capital-intensive one. For the Hungarian economy, such an opportunity has opened up in the global economy that was not provided between 1920 and 1990; because now the geopolitical space has opened up for our catching-up. It is not a coincidence that the economic growth of the East-Central European region is considerably faster than the European average,

We need to do everything we can to take stateowned companies public, as presence in the stock markets enables us to measure the efficiency of companies. The presence of blue chips is also very important, but the listing of other large companies is also required. For us, it is worth considering the Polish example, where all the large banks are listed in stock exchanges, basically in a compulsory manner; on the one hand, this model would present a dynamic source of capital for the stock market, but would also be important for banks as their performances would become measurable through the stock market. Medium-sized enterprises constitute the backbone of the Hungarian economy, therefore we need as many strong medium-sized enterprises as possible, as it is demonstrated by South German, Austrian and North Italian examples. Today, there are 25,000 small enterprises on the verge of becoming

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The New World Order Conference

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The New World Order Conference Author: Éva Szentirmai

The conference organized by PAGEO on 29 November coincided with the Chinese Premier’s visit to Budapest at the occasion of the 16+1 Summit. In parallel with this world event, the conference welcomed nearly 150 participants to answer the following questions: can we still speak about a unipolar world? Can we be in the forefront of a new bipolar world order with new participants, or can we see the emergence of a multipolar world order? Will the emerging countries accept the existing structures, or will it be necessary to reform the system entirely? The presenters sought the answer to these questions in their presentations.

Europe as well as their positive influences on our region. He compared the economic cooperation initiated with the 16 CEE countries to China’s Marshall Plan, which might strengthen the Central and Eastern European Region’s position within Europe. He stressed that China has sent an invitation to our region and it is only up to us whether we exploit this opportunity. Jones supposes it is essential that the youngsters get involved in the building of relations, and he highlighted the importance of knowing intercultural communication, which is the pledge of establishing good relations. Therefore, education and exchange programs are of key significance.

THE INTERNATIONAL INSTITUTIONS SESSION (moderated by Anton Bendarzsevszkij, Director of Pallas Athéné Geopolitical Foundation). First Oleg Buklemisev (Associate Professor in the Department of Economics at Moscow State University) held his presentation entitled Multipolar or Fragmented World: An Economist's View. The speaker pointed out that the world has become fragmented rather than multipolar. The changes taking place are slow and circumstantial rather than fast and sustainable. The acceptance and significance of international institutions has largely decreased. In his opinion leadership problems are primarily caused by the lack of actual global leadership instead of the false steps, which are rather consequences. Oleg Buklemisev

The conference consisted of three main sessions: the role of international institutions, the panel on China and the rise of Asia, as well as the role of the European Union in the changing world order.

Norbert Csizmadia

The event was opened by President of Pallas Athéné Geopolitical Foundation Norbert Csizmadia. In his opening speech, Csizmadia presented the significant results achieved by the Foundation so far and the commitments of PAGEO in the Sino-Euro scientific and economic relations. The speaker highlighted that we are at the dawn of a new geopolitical era, and the winners and losers of the new age will be determined in this geomoment. He raised important questions that extend the structure of the forthcoming new age and stated that in this new age it is connection points, connectivity and complexity that play the most important role. The structures of the new system are now taking shape in the form of smart cities, knowledge ports, HUBs and so on. Nevertheless, Csizmadia pointed out that the drawing of new outlines requires not only a good map and a compass but a good pen as well to redraw the picture of the emerging new world. The 16+1 initiative offers a big dose of ink for this pen, which helped us organize this conference that we were waiting for with keen interest. The first speaker, David A. Jones (Professor at the American Studies Center, University of Warsaw) held a keynote speech entitled Move Europe East: Seizing an Opportunity to Make Central and Eastern Europe’s Economic Wealth Equal or Surpass that of Western Europe, introducing China’s geopolitical and geo-economic strategies to the audience. In his presentation, the speaker emphasized the cooperation opportunities of China and Central and Eastern

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David A. Jones

Su Changhe Following this, Su Changhe (Executive Dean at the School of International Relations and Public Affairs of Fudan University) delivered his presentation entitled The Coming of a New Era of International Relations and its Theoretical Implications. The speaker discussed and analyzed the phenomena, problems and contradictions (e.g. open global economic system vs. protectionism) induced by globalization in the world, using 10 questions as a guideline, and he also studied the potential national and international responses to these questions. In our world order one of the key issues is that the gap between the rich and the poor is getting deeper rather than decreasing, and there is no global responsibility. The Professor mentioned mutual interests instead of universal interests.

The second presentation was Power projection in today’s international arena: the role of international organizations by Dávid Szabó (Director for Foreign Affairs at Századvég Foundation). The speaker emphasized the importance of international institutions, but he also highlighted the deficiencies of the institutions. He underlined the need of reforming the UNO. Following this, the presentation entitled New world order and Old Fashioned UN: Is it Sustainable? by Dusan Prorokovic (Director of the Center for Strategic Alternatives, Serbia) examined the changes of the previous decades that affect the current geopolitical situation. In his presentation the speaker pointed out that the changes in world politics are still determined by the great powers; however, the power relations are slowly being rearranged, and this is not reflected in the organizations of the UNO. Suggestions for solutions exist, but they violate fundamental American political interests. Everyone wants to find a solution, but the organization is still far from it.

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The New World Order Conference

build a community that is dedicated to the future of humanity and able to create an open, inclusive, clear and fair world that enjoys the fruits of lasting peace, entire safety and common growth. The BRI and the 16+1 Initiatives definitely support this theory.

Viktor Eszterhai

Oleg Buklemisev, Dávid Szabó, Dusan Prorokovic, Diána Szőke The next speaker, Diána Szőke (Senior Analyst at the Institute of Foreign Affairs and Trade) started her presentation The World in 2035: A geopolitical forecast with an eloquent quotation made by Niels Bohr in 1922 (“Prediction is very difficult, especially if it’s about the future.”). This citation suggests how complex the present world political situation is. Nevertheless, we should be able to outline some kind of a potential prospect through analyses, along certain topics so that we can get ready for the challenges. In relation to this, “The World in 2035” project provides a forecast on the changes taking place in the world. Accordingly, the three most debated topics - with the most obscure future depicted are populism, Russia and economic cooperation, as well as the “Black swan” events, considering which there is hardly any information but they might exert a significant effect on the world in the future. The final statement is that the research definitely shows a power shift towards Asia and confirms the emergence of a multipolar world order. In addition to that, the forecast is pessimistic about the political changes but optimistic about economic development.

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CHINA AND THE RISE OF ASIA SESSION (moderated by Tamás Baranyi, Leading Researcher of Antall József Knowledge Center)

Kong Tianping

The first speaker of the session was Kong Tianping (Senior Researcher of the Institute of European Studies at the Chinese Academy of Social Sciences) with his presentation China's role in changing international order. He provided useful indications about China’s peaceful rise and future role in the establishment of the new world order. According to the speaker, the Eastern Asian great power primarily aims to

The next presentation was What is the interest of the EU within the BRI? by Viktor Eszterhai (Deputy Director of Research and China Senior Analyst at Pallas Athéné Geopolitical Foundation). The world order led by the USA has provided a favorable environment for the USA for several decades. This presentation sought the answer to the question whether the Chinese alternative to the changing world order, the “One Belt, One Road” initiative offers cooperation opportunities to the EU. The current world order is definitely based upon the USA and the EU, which China would like to change in the long term. The Chinese ambitions are well served by the BRICS cooperation, which might considerably overshadow the Euro-Atlantic forcelines concerning both its economic weight and its population in the future. However, the BRI is most significant initiative for both parties in economic terms. At the same time, this cooperation also holds out a carrot with it, facilitating China’s further economic consolidation in the long term; however, the aim is still to erode the EU’s international importance. Ágnes Szunomár

In her extremely topical presentation Belt & Road – Implications for the CEE region, Ágnes Szunomár (Research Fellow at Institute of World Economics, Head of the Research Group on Development Economics) provided information on the economic relations of the People’s Republic of China and Central and Eastern Europe, supporting the significance of the 16+1 Summit in Budapest. The region is highly important to China thanks to the considerable economic potential hidden in these countries, which the BRI and the 16+1 initiative take really seriously. It is a key region and an entry point for the spreading towards the western part of Europe, it has cheap and highly qualified workforce and it is less sensitive to political and economic issues than the western part of the continent. Similarly, the CEE Region deems cooperation with China as an opportunity in terms of investment, trading and diversification. Nevertheless, besides the benefits of cooperation, negative impacts such as the changes in the CEE-EU and the China-EU relations also come to the foreground. The former is overshadowed by disappointment and the latter by the status of human rights and Tibet. The last speaker of the section,

Ramachandra Byrappa Ramachandra Byrappa (Associate Professor at the Department of Modern and Recent History, Eötvös Loránd University) delivered a brief and concise presentation entitled Tango or tangle: Let us leave southernization to India. He discussed the special situation and future world political opportunities of China and India. He outlined the theory of the northern and southern system, with the natural sphere of interests arising from the geographical location of the two countries. Also, he specified the different ideological bases of the two countries. THE ROLE OF THE EUROPEAN UNION IN THE CHANGING WORLD ORDER (moderated by László Vasa, Deputy Director for Operations at the Institute for Foreign Affairs and trade).

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The New World Order Conference

The first presentation What European foreign policy to address today's and tomorrow's geopolitical challenges? of the Section was delivered by David Criekemans (Associate Professor in International Relations at the University of Antwerp). According to the speaker, the foreign political processes related to the European Union influence the establishment of the common solution mechanisms for the community. The internal problems prevent the EU from taking significant roles in world politics. However, the new foreign political doctrine of the USA imposes serious challenges on Europe, although in certain cases the interests of the world powers have not coincided (e.g. Eurasia). The European Union did not recognize how serious geopolitical consequences the Ukrainian events might have against Russia. However, no decision has been passed on the way of settling the damaged relationship. China’s obvious rise needs the adaptation of the Balance of Power Policy from the EU, too. Nevertheless, the provision of internal stability should be the primary purpose.

Márton Péti This hot topic was followed by István Perger’s (Deputy Head of Representation of the European Commission in Hungary) presentation entitled The Future of Europe - Possible Scenarios. The need to solve the problems affecting the future of the EU are more and more pressing, since the political and economic situation of the world is continuously changing and the forecasts are rather negative for the EU. The presentation discussed the 5+1 potential scenarios outlined by Juncker, as well as their positive and negative influences. The speaker also touched upon the schedule for passing the political decisions of the Union.

spondents. It is also interesting to note that despite the disagreements with the European Union the image of the community is rather good than bad. When assessing the functioning of the EU, women and men respondents did not differ significantly; however, women’s attitude to Europe was a little more positive. The questionnaire also touched upon the image of Asia and the future of the world. The New World Order Conference was an exciting and hot geopolitical event with lively debates at the impressive and legendary venue of Gerbaud Confectionery.

Anton Bendarzsevszkij

David Criekemans

In his presentation Changing potentials of European development bringing cohesion and diversity Márton Péti (Head of Institute, Institute of Geostrategy at the University of Corvinus) analyzed the EU’s inner problems in depth. Owing to the economic crisis the significance of global politics has been pushed into the background since the early 2000s. The global economic role of the European Union is decreasing, while the weight of Asia is increasing. By 2050 the situation will have become even worse with respect to the USA and Europe. Unsolved, internal economic and cultural differences mean a considerable disadvantage. The different foreign economic orientation and the macro regional differences predict a difficult future.

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István Perger

The last presentation of the conference was Attitudes and interests of Hungarian population towards global foreign policy, USA, EU and China by Anton Bendarzsevszkij (Director of Pallas Athéné Geopolitical Foundation). The speaker presented the findings of a representative questionnaire conducted by PAGEO on the current attitude and interests of the Hungarian population concerning the actors in world politics. The research reveals that TV still has the most significant information mediating role (58.6%), nearly three times the online media (22.9%). It turned out that in Hungary one of the least known European leader is Emmanuel Macron, while Vladimir Putin is the most influential politician according to the re-

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GEOPOLITICAL AND STRATEGIC FACTORS 136

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Table 1: Geopolitical/Geostrategic factors PHYSICAL FACTORS

Extension (territorial dimension) Location (relative position) Configuration (form and boundaries) Morphology (orography, hydrography) Surface (geological features) Vegetation Climate Seaways and waterways Aerospace Alterations resulting from human activity

HUMAN FACTORS

Demography Demographic features Distribution and density pf population Population growth index Composition and structure of population Ethnography Quality of life and standard of living Race, religion, language, education, family, scientific quality and other features

NATURAL RESOURCES

Energy Minerals Food

TRANSPORTATION AND COMMUNICATIONAL FACTORS

Transport system Telecommunications system

Author: István Szilágyi

Geopolitics is the study of the struggles taking place in the geographical space with a changing content and the network of relationships between actors of different types, levels and degrees of organisation playing a role in and shaping the system of international relations.

In geopolitical analyses, the changing interpretation of space, location, situation, sense of space, actors, boundaries, identities, civilisations, geopolitical patterns and codes, world system models, globalisation processes and the geopolitical scale are particularly important. Geopolitics, as a multidisciplinary social science studying the spatial and partly geographical aspects of the international relations theory, is a part of political science. Therefore, the power relations of the international system are a major focus of geopolitics. Society is closely related to the notion of politics and domination. Politics serves to display the alliances, cooperative or opposing, confrontative relationships between the actors of the international system. In content, politics means a relationship between the actors of the given system formed in an objective, conscious, practical, voluntary, total and institutionalised form. Symbols, ideas, ideologies, political culture and communications also constitute an important part of it. The notion is often defined as the art of choosing between alternatives or a determiner of the confrontational method of distributing limited wealth. The central, fundamental question of politics is the question of power. Political struggle is about seizing or retaining power, both nationally and internationally. In general terms, social power is the permanent dominance, predominance of a class, group, layer or political elite prevailing in making decisions about the substantial issues of social life and determining the method of distributing available resources in a given historical era. In the system of international relations, the notion

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is related to major powers, superpowers, global powers, empires, and embodies in emerging power poles and world models. The specific institutionalised form of power is called domination. According to Max Weber, “Power is the probability that one actor within a social relationship will be in a position to carry out his own will despite resistance, regardless of the basis this probability rests. Domination is the probability that a command with a given specific content will be obeyed by a given group of persons.”

“Geopolitics, as a multidisciplinary social science studying the spatial and partly geographical aspects of the international relations theory, is a part of political science.” The analysis of the system of international relations from a geopolitical perspective adopts Max Weber’s approach. Power is regarded such an ability, opportunity or chance in which one of the partners is in a situation to impose or to be able to impose his own will upon the other. If the actor who endures or tolerates this imposition resists, he will face retaliation or punishment. Thus, power is a system of relationships relevant in a particular

TECHNOLOGICAL FACTORS STRUCTURAL FACTORS

Political relations Social relations Economic structure Military force Other factors

(Source: Geopolítica: Teorização Clássica e Ensinamentos by Mendes Dias, Carlos Manuel Editora Prefacio, Lisboa, 2005. p. 222.)

historical context. The position of power indicated, however, is not absolute and predestined. The relationship between actors alters as power relations change. A position of power can be legal and legitimate, stemming from international law and conventions, but it can be imposed by force. What seems legitimate and conventional for one partner, might be seen as based on force, lacking legitimacy and imposed, therefore it should be changed and rejected, by the other. In the system of international relations, power often has subjective features. Therefore, the actor that feels, knows or believes that he is in a weaker, more vulnerable position, or limited in spatial movement, displays adaptability. Power is a multidimensional phenomenon. In addition to economic, military and political factors, it is also influenced by the changes in hegemonic relations. Power is a changing and transforming phenomenon. In the system of international relations, power is based on three factors. Its objective

base is constituted by available material assets, raw materials, physical resources. Its subjective component is constituted by the so-called national character, psychical and moral resources deployable at the given point in history, national cohesion, patriotism, politics, the given state of political leadership and political culture, quality of diplomacy, level of detail, quality and acceptance of permanent and conjunctural national objectives, solidity of intellectual and emotional bonds. The base for power, however, is relative. It depends on place, circumstances, situation, rivals, historical situation, circle of allies, etc. Force is an essential element of power. By force, we mean all resources and aids that can be applied if required. In the relationship between force and power, force integrates the objective and subjective sources of power, i.e. the geopolitical/geostrategic factors. The geopolitical/geostrategic factors included in the last chapter of the book Geopolitics by Carlos Manuel Mendes Dias are displayed in Table 1.

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GEOPOLITICAL AND STRATEGIC FACTORS

Table 2: The nine largest countries of the world by area Country

Area (mn sq. km)

Russia Canada China USA

17.00 9.970 9.526 9.371

Brazil Australia India Argentina Kazakhstan

8.51 7.686 3.287 2.78 2.71 Table 3: The world’s most populated countries

States China India USA Indonesia Brazil Nigeria Russia PHYSICAL FACTORS The physical aspects of geopolitical, geostrategic factors include the territorial implications of a given political entity. The elements requiring separate analyses are extension (extensão), territorial dimension, location (localização), configuration (configuração), morphology (morfologia), surface (solo), vegetation (vegetação), climate (clima), seaways and waterways (mar e vias navegáveis), aerospace (meio aeroespacial), and alterations resulting from human activity (alterações resultantes da acção do homem). The geographical extension of a geopolitical actor and the size of its territory fundamentally determine the role that the given unit plays in international relations. Physical dimension is an important element of the existence of major powers creating structures. In the case of states having larger areas, the chance of abundance in natural resources increases. The safety of vital centres of different types can be more guaranteed. Naturally, the advantages of a vast extension are and can be realised if spatial structure is well-organised. In 2012, nine states accounted for 60 per cent of the Earth’s area. There are five major powers and four axis states among them (Table 2).

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Population (mn people) 1,360 1,260 310 255 210 183 150 Situation or location considerably influences the room for manoeuvre and sense of security of a geopolitical actor. Relationships with neighbouring countries, the proximity of centres of powers to each other and large economic hubs, their accessibility, and the quality of their system of infrastructural relationships are also relevant factors. A coastal position offers advantages in terms of geography as well as communications and access to wealth. The shape and form of a country also has an impact on the geopolitical room for manoeuvre. It may influence the sovereignty of the state, enhance the vulnerability of its borders, decrease or increase the significance of safety zones. States with a compact structure and natural borders can be regarded as having ideal structures. Territorial discontinuity presents disadvantages and difficulties even in the world of five-dimensional space. Creating internal cohesion between islands, island states or enclaves is a difficult task. Natural borders, however, are more easily defendable. Dividing lines running across the meeting zones of different civilisations might be both advantageous and disadvantageous. Characteristics of the surface also determine the room for manoeuvre and opportunities of

geopolitical actors. Topography, vegetation, climate, seaways and waterways and their links, channels, straits, possession of special status regions, control over aerospace and cyberspace or the ability of it constitute an important element of the room for manoeuvre of the actors of international relations. HUMAN FACTORS The multi-component human factor is a major geopolitical implication. A basic criterion for a major power creating structures, the critical mass derives from the size of the population and the quality of demographic features. In 2017, seven states account for 54 per cent of the world’s population (Table 3). Changes in the numerical ratio and the quality indices of population are considered more important than the size and extension of the land area. As it is clearly displayed by Table 1, all countries with a large population – except for Indonesia – can be regarded as major powers Applying mechanically a merely quantitative approach, however, does not prove to be efficient or sufficient in the case of geopolitical analyses, either. We regard it important to explore, present and analyse the geographical distribution, employment structure, literacy and educational levels, growth pace, life expectancy, health status, the urban-rural ratio of the population, as well as its composition by sex, race, religion, language and age. NATURAL FACTORS The existence or lack of natural resources fundamentally determine the opportunities, the situation, the applied economic policy, the autarkic efforts or the openness of and the role played in international trade by a geopolitical actor. Dispose of strategic raw materials can considerably influence the fate and the prospects of not only a particular political community but entire mankind. Countries exporting and producing oil, and having significant energy reserves may assume roles that are more significant than their real economic weight, or are even key roles. Most of the currently known natural gas and oil reserves

Figure 1: Energy reserves of the strategic ellipse

can be found in the border, meeting and collision zone in the strategic ellipse between the Islam and Western civilisation (Figure 1). 70 per cent of the oil reserves and 65 per cent of the natural gas reserves of the Earth are located in this zone. Within the strategic ellipse, we can distinguish regions with reserves of 1 to 5 trillion m3 , of 5 to 10 trillion m3 and of over 20 trillion m3 . In the 21 st century, however, in addition to energy carriers, possession of fresh water sources can render countries and regions major actors. We can experience a similar situation in relation to the possession of rare earths required for conquering the aerospace and the cyberspace. In 2009, most their production and consumption concentrated in China, Japan, Europe and the United States. Most of the known reserves can be found in China, the United States, Russia and Australia.

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In his book referred to earlier, Ricardo Méndez Gutiérrez del Valle also dwells on the question of the sources of state power. On the basis of Political Geography by Richard Muir, he identifies six different sources of state power. He talks about the morphological power expressing the size, form, location, situation of a political entity and the demographical power reflecting the health, education, generational, social. etc. state of the population. He analyses the characteristics of economic power, military power, organising power and foreign policy power. He calls the last two elements implicit power, and talks about explicit power in the case of the former four ones.

Figure 3: Shift in the sources of state power (Source: El nuevo mapa geopolítico del mundo by Méndez Gutiérrez del Valle, Ricardo. Tirant Lo Blanch, Valencia, 2011. p. 193) Cohen have been taking an important role. In Chap-

Analyses conducted from the viewpoint of military force and potential prefer the size and nuclear capabilities of the army.

Figure 2: Production and consumption of rare earths (Source: USGS2010; Lynas Corporation Ltd, 2010; SRI Consulting; Bloomberg; Kaiser Bottom-Fisch) Natural resources include natural raw materials, mining products, hydro power, the amount of sunlight and rainfall, the natural environment surrounding humans, food, fish and meat production (Figure 2).

It has to be emphasised that it means much more than that. Using and developing state-of-the-art technology is not primarily related to the orders made by and financing the programmes of armed forces.

TRANSPORTATION FACTORS

STRUCTURAL FACTORS

Transport and transport links contribute to providing the area and the population with and ensuring their access to wealth and ideas. In the geographical and anti-geographical environment of the 21 st

The cluster of structural factors is related to the mutual relationship between man and the physical geographical space. It includes political-administrative and state organisational structures, the economic structure. The efficiency and adequacy of the latter one are reflected by such indicators of macroeconomics as the gross domestic product, economic growth, the inflation rate, investment willingness, the return on investment (ROI) index, developments of the current account, the productivity level and the unemployment rate. On the whole, the distributional method of wealth and the amount of per capita GDP also belong here. Social and employment structures, amounts invested in research and the education system are also adequate indicators of a country’s level of development. All these factors are completed by military infrastructure, military facilities and the force and prestige of the army.

century, in a shrunk coordinate system of space and time, in the age of the e-prince and an information society, the role of the flow of information and knowledge belonging to soft power and shaping hegemonic relations has become at least as important as that of rail, river, sea and air transport. The fate of political structures and triumphs in armed conflicts depend on the efficiency of this sector. TECHNOLOGICAL FACTORS The scientific-technological factor is an important indicator of a country’s level of development. Even today, there are many who associate technological innovations with the modernisation of armies.

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We have referred to the world hierarchy model of Ray Cline and a version corrected and completed by General Carlos de Meira Mattos. In all the abovementioned cases, the analyses were focussed on the power capacities of countries, and within that, the alterations of the relationships between the elements of soft and hard power. Although we know very well that the state is only one of the participants of the system of international relationships in the 21st century, the state is the geopolitical unit on which the above-mentioned analyses focus. However, we agree that in the relationship between hard and soft power mutually permeating each other, the geopolitical balance tilts towards soft power, related to culture, knowledge and information. Economic potential (potencial económico), the number, size and composition of the population, the existence of natural resources and raw materials (población y recursos naturales) and military force (fuerza militar), belonging to the category of hard power, remain essential parts of the role taken by the state. However, cultural influence (influencia cultural), different types of information and knowledge (información y conocimiento) as well as political and ideological leadership, influence and hegemony (liderazgo político e ideológico), belonging to the scope of soft power, have been gaining increasing significance. Naturally, the listed elements mutually act and react, magnifying and multiplying their effects both in domestic and foreign policy (Figure 3). Among geopolitical and geostrategic factors, the phenomena, categories and system of relations called geopolitical structures by Saul Bernard

ter 3 of his book published in 2009, the American author examines the interactions and development processes of geographical and political forces, and differentiates between pattern, referring to the shape, size, physical and human characteristics of geopolitical units, and the elements describing their main features. According to Cohen, geopolitical structures are organized along the following hierarchically ordered spatial levels: 1 the geostrategic realm – the most extensive level, or macrolevel; 2 the geopolitical region – a subdivision of the realm that represents the middle level, or meso level; 3 n ational states, highly autonomous regions, quasi states and territorial subdivisions within and across states at the lowest level, or micro level. Outside of this ordering of structures are regions or clusters of states that are not located within the realm or regional frameworks. These include regions such as shatterbelts, compression zones, gateways, which serve as bridges and function as links between realms, regions or states, and convergence zones, which are regions caught between realms, and whose ultimate legal and political status is yet to be determined (Figure 4). At the beginning of the 21 st century, Cohen identifies four big geostrategic realms or zones. The American author talks about a trade-based maritime realm, a Eurasian continental realm, an EastAsian realm and an Indian Ocean zone anticipated for Delhi’s hegemony, led and influenced by India, and dominated by Delhi.

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(d) H ow can How can we counter our current enemies and emerging threats? (e) H ow do we justify the four calculations above to our public, and to the global community?” When defining geopolitical codes, the fact that they are calculated under changing internal and external circumstances, therefore require regular review and adjustment must be always considered. It is appropriate and wise for countries and political elites to have long-term strategic goals and short-term action plans. As we could read, since the 1950s, the Brazilian Highest Military Academy

Figure 4: Geopolitical levels and structures (Source: Geopolitics: The Geography of International Relations by Cohen, Saul Bernard. Rowman & Littlefield Publishers, Inc. New York, 2009. 41. o.) The already mentioned geopolitical regions, shatterbelts, compression zones and gateways can be found within geostrategic realms or zones. Geostrategic and geopolitical regions include leading states, major powers. The geopolitical map published by Saul Bernard Cohen names seven great powers, or centres of power – the United States, Brazil, the European Union, Russia, India, China, Japan – by the first quarter of the 21 st century. On the basis of fundamental geographical and structural features, Cohen differentiates between historic or nuclear cores, capitals or political centres, ecumenes, i.e. areas of great density of population and economic activity, an effective national territory – ENT and effective regional territory – ERT of an area or region. He also examines empty areas, boundaries and nonconforming sectors including minority separatist areas or rogue states jeopardising international security. In the monography referred to, Cohen outlines and overviews the regional-political features and changes in geopolitics, geography and international relations by considering these viewpoints and categories. It is a fundamental task of geopolitical thinking to classify, examine, compare scales and levels, to

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conduct a comparative analysis based on identical viewpoints and levels of actors belonging to different types and having different features who are active in the five-dimensional geographical space, and to set up a homogeneous category system of research. Paul Vidal de la Blache, preferring regional analyses, or Yves Lacoste, applying a spatial scale based on the multiplication of four by ten, had different ideas about that. Researchers placing the problem area of the supremacy of maritime or land power in the focus of their work have seen this subject in a different light, and experts engaged in studying the relationships between space, international political and powes relations from the viewpoint of aerospace and cyberspace also depict it in a different way. In geopolitics, geopolitical codes serve to internationally convey and represent, internally and externally justify national interests, and to realise strategic goals. “A geopolitical code is the manner in which a country orientates itself to the world. There are five main calculations that define a country's geopolitical code. They are:

has been placing great emphasis on defining permanent and conjunctural national objectives, permanent and volatile elements of national power, as well as the foreign affairs priority system and the geopolitical positions of the country. This consistent work will bear fruit in the first decades of the 21 st century. Viewed in a global context, we must say that national geopolitical codes have been aggregated globally. However, this does not mean the interests and objectives of all countries will be realised or carry the same weight. Certain geopolitical codes influence on the world’s events more heavily than others. Major powers creating structures, the global powers of different eras have better chances of realising their economic, political, ideological and civilizational ideas and aspirations than other states. The number and circle of leading powers is also continuously changing. Therefore, it is worth examining long-term trends and global models prevailing in the system of international relations thoroughly.

(a) W ho are our current and potential allies? (b) W ho are our current and potential enemies? (c) H ow can we maintain our allies and nurture potential allies?

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STRATEGIC RAW MATERIALS OF THE EARTH Author: László Gere

Although some authors argue that the most important raw material of the 21 st century is data (or we could also say, data is the oil of the 21 st century), simultaneously certain “real” raw materials are also becoming all the more valuable and important. In our article below, we attempt to identify and map rare raw materials and their fields of use, and, at the same time, to call attention to future challenges related to the concentration of their reserves and the possible economic-political implications of the strategic fields of use of these elements.

CRITICAL RAW MATERIALS

RARE EARTH ELEMENTS

There are several different categorisations of raw materials representing the highest economic importance, depending on the viewpoints of their study: their occurrence, the concentration of their extraction, a regional perspective (e.g. raw materials critical for the EU), increase in their demand, etc. In the broadest sense, this group may as well include water (drinking water) or sand, but they are not discussed in this article, as the strategic significance of water alone would require a separate analysis. This analysis does not dwell on energy carriers (oil, natural gas, coal, etc.), either; again, this is a separate topic. This study primarily focusses on elements that have become particularly important due to the 21st-century technological revolution, and are likely to be even more significant in the future. Regarding their fields of use, the framework of our analysis has been mostly limited to their technological applications.

Rare earth elements (most frequently referred to as REE in international literature) include a set of elements with atomic numbers 57 through 71 in the periodic table, i.e. the lanthanides, as well as scandium and yttrium. Despite their name, REE are not particularly rare relatively (for example such widely-used elements as zinc, copper, nickel or lead), they are rather plentiful in Earth's crust; their mineable reserves (concentrated and economically exploitable ore deposits), however, are really rare. They exhibit similar physical and chemical properties, and, for their advantageous properties, are found in countless modern devices, from the batteries of electric cars and various electric devices to wind turbines. Although there is a great similarity between their basic properties, each REE has such unique features and special fields of use that exclude their substitutability. Therefore, their classification depends on their importance in the specific fields of their use, the lack of adequate substitutes, as well as their reserves, and the rather strong monopolisation of their extraction.

In particular, the article is focussing on rare earth elements as a larger independent set, and is presenting the specific elements one by one.

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Table 1: Largest REE mining countries and their production (2007-2015, tons). Source of data: British Geopoly Survey.

Currently the supply of REE definitely depends on China, most of mining is done there. The country has been an absolute world leader in the past decade with a share of over 90 per cent. One reason for this is the fact that the mining of REE usually results in signiﬁcant environmental impacts. Many deposits are associated with high concentrations of radioactive elements such as uranium and thorium, which requires separate treatment and disposal. REE processing is characterised by high levels of

water consumption, energy inputs, and chemicals use. The land allocation can be also signiﬁcant for both mining and processing operations, as well as for the tailings dams, and long-term storages of the radioactive waste materials. There are multiple examples of negative past experience and tragic incidences associated with the application of poor procedures, which does not make this kind of mining activity very attractive. This is exactly the reason why the rest of the world stopped production when China opened its first Inner Mongolian mines in the 1980s and flooded the global market with cheap rare earth metals, because no one could compete with the prices, and this way their environment was not subject to further degradation, either. However, a rather strong monopoly situation has arisen. In 2011, for example, China introduced a quota for the export of REE, which was upheld until 2015 (when WTO obligated China to abolish it), and the country has already banned exports of rare earth metals to, for example, Japan, to assert its geopolitical interests. This aggravating geoeconomic threat has given a significant push for other countries to re-open their mines and explore new reserves. Significant mineable reserves have been discovered in several regions, and at the current state of knowledge, the largest REE deposits are not located in China any-

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more (although a significant amount, some 37 per cent of global reserves is), therefore extraction is expected to diversify in the future. Rare Earth Elements: Atomic Number

Name

Symbol

Lanthanum

Cerium

Praseodymium

Neodymium

Promethium

Samarium

Europium

Gadolinium

Terbium

Dysprosium

Holmium

Erbium

Thulium

Ytterbium

Lutetium

Major fields of use of REE include: – high-strength alloys: Sc, Y, Yb – electronics: in computer switches (Sc), laser devices (Sc, Y, La, Dy, Er, Nd), imaging units of monitors (Sc, Y, Eu), microprocessors and hard discs (Ce), communications devices (Y, Nd, Yb) – technologies related to clean energy: Y, La, Ce, Nd, Eu, Tb, Dy – light technology: studio lights (Sc), high contrast devices (Pr) – medicine: cancer treatments (Y) – the battery industry: batteries of electric vehicles (La), other batteries (La) – optics: Y, La, Ce, Pr, Eu, Gd, Tb, Er – corrosion technologies: Sc, Pr – high-strength magnets: Nd, Sm, Dy, Ho, Tm – catalysts for petroleum refining: La, Nd, Pm – in X-ray devices: La, Yb, Lu. FIELDS OF USE OF OTHER CRITICAL RAW MATERIALS: Most critical raw materials are generally used as inputs into high-technology or strategic sectors. Although often needed only in small quantities,

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these metals are increasingly essential to the development of technologically sophisticated products. They play a critical role in the development of innovative “environmental technologies” to boost energy efficiency and reduce greenhouse gas emissions (and, in this context, their recycling as well as their extraction has also become a strategic question). Hydrogen-fuel based cars, for example, require platinum-based catalysts; electric-hybrid cars need lithium batteries; and rhenium super alloys are an indispensable input for modern aircraft production. Many of the raw materials are used in the semiconductor industry. The semiconductor industry is dominated by China, Taiwan, South Korea, United States, and Japan. The role of the semiconductor industry is one of a technology enabler: it is widely recognized as a key driver for economic growth throughout the electronics value chain. It is one of the fastest growing industries of recent years, experiencing a growth of over 10 per cent per annum over the last 20 years; in 2004 alone, the business of semiconductor-related electronic systems accounted for almost 10 per cent of the world GDP. Many of the critical raw materials are used in the forms of alloys with particular properties – withstanding extreme friction or heat for example – and are therefore necessary inputs into the automotive and aircraft industries. All countries with major automotive or aircraft industries (e.g. Brazil, China, European Union, India, Japan, Korea, United States) are therefore users of the alloys of critical raw materials. The next part of this study is describing selected elements based on the peculiarities of their occurrence and their main industrial uses. Antimony (Sb) Antimony is a mineral with an increasing strategic significance. Most of its reserves can be found in China; in recent decades, this single country has accounted for more than 90 per cent of its global production. In addition, antimony is being also produced in Tajikistan, Bolivia, Russia, the South African Republic, Australia and Turkey on a smaller scale. The economies of the EU, the USA and Japan heavily rely on the import of antimony. However, calculations suggest that China is going to become a net importer from being a net exporter (that is, it will require the import of this raw material).

Uses: – its trioxide is used in the chemical and plastic industries as a synthetizing additive; its compounds are used to make flame-retardant materials in, for example, plastic insulation materials, electric devices and household utensils; furthermore, it is added to paints, enamels, glass and pottery for this property. It is also widely used in the plastic industry as a catalyst; – in metal alloys it is used to improve their hardness and strength; – it is used in the electronics industry to make some semiconductor devices, such as infrared detectors and diodes; – lead-antimony alloy is used in batteries. Beryllium (Be) Beryllium is a light (its density is 30 per cent lower than that of aluminium) and stiff (three times stiffer than titanium) material, with several fields of use in industries applying state-of-the-art technologies. Its copper alloy (if its beryllium content is less than 2 per cent) results in a material with strength similar to that of steel, which also conducts electricity and heat very well, and resists deformation even in hot temperatures. Its ore is transparent to X-rays; therefore, it is particularly important in the application of medical X-ray and CT procedures. Most of the world’s beryllium (65 per cent) is produced in the United States. China, Kazakhstan and Brazil, as well as some African countries (Nigeria, Madagascar, Mozambique) are also important producers. Uses: – it is an important element in components of telecommunications infrastructure equipment, computers and mobile phones; – it is used in medical imaging (X-ray, CT), diagnostic and laser devices; – in the automotive industry, it is used in the manufacture of airbags and electronic braking systems; – in space exploration, beryllium materials are used in telescopes or heat shields; – in the energy industry, it is suitable for oil and gas extraction; – its alloys are important for automobile and airplane components.

Silver (Ag) Silver has the highest known electrical conductivity of all electrical conductors, but due to cost it is relatively rarely used in electronics. Its heat and light reflectivity is also higher than other metals. In nature, silver occurs in its elemental state but is far more common in sulphides. The three largest producers of silver are (in order) Peru, Mexico and China, accounting for almost half (45 per cent) of global production. Uses: – in electronics: important component of electrical contacts, switches, button-cell batteries, printed electrical circuits; – its bromide and iodide were important for photography, but silver salts still have an important role in digital photography, in producing high-quality images and protecting against illegal copying; silver is also used in the manufacture of light-sensitive lenses; – its carbide and fulminate are explosives; – it is used in medicine for its antibacterial properties. Gallium (Ga) Elemental gallium does not occur in nature; its combinations are present in zinc and bauxite ores. Its extraction is closely related to processing bauxite and aluminium. It is most frequently used, for example in electronics, as gallium arsenide. More than 80 per cent are produced in China. Only a few companies of the world (one European and some Japanese and Chinese companies) are able to produce gallium arsenide with adequately high purity. Uses: – its social-economic significance is enormous, it is very widely used: it is applied in the radiofrequency chips of mobile and satellite communications equipment, laser diodes of fibre structure-based communications systems, LED screens, light-emitting devices, avionic, space technology and defence systems; – as a semi-conductor, it has an important role in electronics; –the research of its alloys and its application as a fuel cell is still ongoing. Germanium (Ge) Like several other rare earth elements, germanium does not occur in its elemental form in nature mixed with other minerals and or in ores as germanite. To-

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materials of the world, which is also extremely light, a good conductor of electricity, and its light absorption is very low, therefore its potential applications in the future are very versatile.

Approximately half of the cobalt reserves are located in Central Africa, and the other half is dispersed in the other continents. Refined cobalt is mostly the by-product of nickel (50 per cent) and copper (44%).

Indium (In) Indium is an element relatively frequently occurring in zinc, lead, tin and copper ores. Its mining and refinery have increased by some 20 per cent in the past three years (2014-2016). Most of it is extracted and recovered from base ores in French, South-Korean, Japanese, Canadian, South American and Chinese sites. Indium is one of the few strategic elements in which Europe is self-sufficient.

Uses: – in rechargeable batteries (for example, for electric/ hybrid vehicles and portable electronic devices); – in biotechnological processes, diagnostics, pharmacy, the manufacture of hip and knee prostheses; – it is also widely used as a pigment, in the manufacture of semi-conductors and other electronic components, alternative energy production (e.g. in components of solar panels, fuel cells, wind turbines).

day, the production of germanium is carried out by processing zinc smelter flue dust, or it can also be recovered from the by-products of combustion of certain coals. 75 per cent of germanium production is estimated to come from the procession of zinc ores, and further 25 per cent from processing coal.

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ly-spread in the manufacture of infrared spectroscopes. Among others, its military application is important, in night vision devices; – it is an important element of the manufacture of the components of firefighting equipment, satellite imaging sensors and medical diagnostic devices as well.

The most important producer of geranium is currently China, accounting for some 60 per cent of total production. The rest comes from mostly Canada, Finland, Russia and the United States. Although there are many alternatives to substitute germanium (unlike in the case of most critical raw materials), the properties of substitutes are poorer, therefore their application is not optimal.

Graphite (C) (Natural) graphite is one of the purest and most crystallised form of coal. It can be both mined or synthetically produced. Its top producer is China, accounting for 70 per cent of world production, and another 20 per cent is mined in Latin America. production in Europe is less than 1 per cent.

Uses: – the three major fields of use of germanium include the manufacture of fibre-optic systems and infrared optics, and it is used in catalysts for the polymerisation procedures of PET bottles. Furthermore, it plays an important role in the manufacture of electronic components (e.g. transistors) and solar panels; – both germanium and germanium oxide are transparent to infrared wavelengths, their use is wide-

Uses: – graphite is essential for the manufacture of lithiumion batteries and as such, for the automotive industry of the future. Therefore, demand for graphite is expected to significantly increase in the future. – the manufacture of insulations and various fireproof products represents another rapidly growing market – a high-priority field of use of graphite is the production of graphene. Graphene is one of the strongest

Uses: – half (55 per cent) of indium use is dedicated to the manufacture of LSD screens. The remaining 45 per cent is used in to make components of various machines ad electric devices; – indium is an important raw material of the manufacture of solar panels and laser diodes.

It is a hard material, which resists tarnishing, which makes it a key component of stainless and other steel alloys.

Cobalt (Co) Cobalt is a relatively frequently occurring element; among others, it has a vital role in the development of animals and microorganism.

The largest chromium ore deposits can be found in South Africa (the Bushveld Igneous Complex is an area covering some 60,000 sq. km, and is estimated to account for some 70 per cent of global reserves),

Chromium (Cr) It is one of the most frequently occurring metals, the 13th most frequent element of the earth’s minerals.

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and Kazakhstan, Zimbabwe, India and Turkey are also important producers. Some reserves can be found in Brazil, Cuba and Albania as well. Uses: – it is used to harden steel alloys and to corrosion resistance (the manufacture of kitchen utensils, cutlery, etc.); – it is used in industries manufacturing refractory products, e.g. in the manufacture of blast furnaces; – about 90% of all leather is tanned using chrome. However, the waste effluent is toxic so alternatives are being investigated; – it is widely used in the chemical industry, for example in the cosmetic industry, or as a catalyst of wood preservatives, or to manufacture magnetic tape; – it is also widely used in pigments, rubies get their red colour from chromium, and glass treated with chromium has an emerald green colour. Lithium (Li) Lithium is the lightest metal and the solid element with the lowest density It never occurs in an elementary form in nature, but only in compounds. Currently, the top lithium producer is Chile, followed closely by Argentina. The United States and Bolivia also have significant reserves. Its market price has tripled since 1998, just like its extraction has between 2000 and 2016. Uses: – its most important use is related to rechargeable batteries: it provides mobile phones, digital cameras, electric vehicles with an energy source. It is also used in some non-rechargeable batteries, for example in the batteries of heart pacemakers, toys and watches; – its alloys with aluminium and magnesium, improving their strength and making them lighter, are used in aircrafts; and it also appears in the manufacture of high-speed trains because of these same properties; – its oxide is used to make special glass and glass ceramics; – its carbonite is used in drugs to treat manic depression. Magnesite (MgCO3) Magnesite is the common name of the mineral magnesium carbonate. When pure, uncontaminated, magnesite contains 47.8 per cent magnesium oxide (MgO). Its major producer is China, accounting for

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some 69 per cent of the total magnesite mining in 2010. Other important producers include Slovakia, Russia, Turkey, Austria, Brazil, Spain and Australia (with a combined share of 25 per cent of the total production). 9 per cent of global production is conducted in the European Union, shared (in order) by Slovakia, Spain and Greece. Uses: – its most important field of use is the production of magnesium oxide for industries manufacturing fireproof material (the industries of steel, cement, ceramics and other heat resistant products account for some 84 per cent of use); – magnesium oxide is also used in fertilizers. Magnesium (Mg) Magnesium is a metal occurring relatively frequently. It does not occur in its elemental form, but can be found in several minerals (dolomite, magnesite, carnallite, or even in sea water). This material has relatively low density (its density is one-quarter of that of steel, two-thirds of that of aluminium, and similar to that of carbon-fibre alloys). In 2016, China provided 85 per cent of magnesium mining. Uses: – it is used in several industries, such as transport (in vehicles, trains and aircraft components), electronic devices (manufacturing laptops, mobile phones and tablets), the steel industry, titanium and zirconium production, pharmacy and agricultural chemistry, as well as the manufacture of medical implants); – it is an important alloying agent, essential for the aluminium industry; – it is an important element of lightweight vehicle concepts, hydrogen storage and innovations in battery technology. Manganese (Mn) Manganese is the fifth most abundant ore on Earth. Its major producers are China, certain African countries (e.g. Gabon), and Australia. In addition, ores with a relatively high manganese content (approx. 24 per cent) can be found on the floor of the oceans. Uses: – it is an alloying agent, it is often used in for example steel alloys (increases the strength of the alloy, improves its workability and resistance to wear). Man-

ganese steel containing 13 per cent manganese is used for manufacturing railway tracks, rifle barrels and prison bars. – its alloy of aluminium is used for making drinks cans, as it improves resistance to corrosion; – its alloy of aluminium, antimony and copper is highly magnetic; – it is an important component of non-rechargeable, standard and alkaline batteries. Molybdenum (Mo) Is a silvery, very hard metal, with a very high melting point. Most molybdenum is used to make alloys. The main molybdenum ore is molybdenite, which is then reduced to molybdenum; apart from that, it can be also obtained as a by-product of tungsten and copper production. Its top producers are the United States, China, Chile and Peru. Uses: – most molybdenum is used to make alloys to increase strength, hardness, electrical conductivity and resistance to corrosion. Its alloys are used in heating elements, drills, saw blades and aircraft components;

– it is used as a catalyst by the petroleum industry; – it is also used as ink for circuit boards, pigments and electrodes. Nickel (Ni) Nickel is a silvery metal that resists corrosion even at high temperatures. It is extremely rare, and still one of the most important industrial metals. Most nickel on Earth arrived with meteorites. One of these landed in the region near Sudbury, Ontario, Canada (this region alone is now responsible for about two-thirds of the world’s production). Uses: – Nickel is traditionally used in minting coins (forint coins, as well as 1 and 2 euro coins also contain nickel); – it is mainly used in making alloys, for example in stainless steel. The alloy of nickel and chromium resists corrosion, even when red hot, so is used in the coating of toasters and electric ovens. A copper-nickel alloy is commonly used in the pipes of desalination plants, which convert seawater into fresh water; – it is an important component for the manufacture of batteries, is essential for rechargeable nickel-

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STRATEGIC RAW MATERIALS OF THE EARTH

cadmium batteries, and also plays an important role in electric transport through nickel-metal hydride batteries; – if added to glass, it gives it a green colour; – pure nickel is used to produce laboratory equipment and medical devices. Niobium (Nb) It is a light, silvery metal, with chemical properties very similar to those of tantalum; they were not distinguished until the 18th century. Although its occurrence is not particularly rare, its mining is extremely concentrated; the top to extraction sites are in Brazil (two Brazilian mines account for some 90 per cent of total production) and Canada. Uses: – it is primarily used as an alloy agent in steel alloys, greatly improving both strength and hardness, in vehicle parts and the manufacture of pipelines; – due to its high melting point, it is used to produce “super alloys”, primarily in components where weight has an important role (turbines, rocket engines, aircraft components, etc.); – for its superconducting properties, is used in superconducting magnets for particle accelerators, MRI scanners and the Large Hadron Collider of CERN; Platinum Group Metals (PGMs) It includes six elements: platina (Pt), osmium (Os), iridium (Ir), palladium (Pd), rhodium (Rh) and ruthenium (Ru). roughly 70 per cent of the world’s total reserves can be found in the South African Republic, and further 20 per cent can be found in Russia. Furthermore, there are some PGM mines in the United States, and recycling also accounts for some reserves. Uses: – they are used as catalysts in petroleum refinery and other petrochemical processes; – in electronics: in hard discs of computers, fuel cells, thermocouples, in multi-layered ceramic capacitors, in flat screens (SED/LCD/OLED), touchpads, portable electronic devices (tablets, mobile phones); – they are used in the production of reflecting surfaces on glass; – in the manufacture of motor vehicles: in airbags, antilock braking systems, spark plugs, oxygen detectors;

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– in jet engines and turbine blades; – in medicine: in dental alloys, chemotherapy drugs used to treat cancers, pacemakers, implanted defibrillators Silicon (Si) It is a grey, metallic, very hard material. After oxygen, it is the second most abundant element In the Earth’s crust; however, it never occurs in an elemental form, practically it can be always found together with oxygen. Most (about 60 per cent on average between 2010 and 2014) of refined silicon is produced in China. This production exceeds both domestic and global use. In addition, important producers include Brazil, Australia, Kazakhstan and Thailand outside Europe, while France, Spain, Germany, Norway, Bosnia and Herzegovina, and Iceland within Europe. Uses: – it is used in aluminium alloys to increase strength – it is most importantly used in the electronics industry: the processors of computers and other chips are made of silicon components, and it can be also found in radio and television (transistor) parts; – as a light-sensitive semiconductor, it is a main component of the manufacture of solar panels; – it is important for the manufacture of furnaces; – in the building industry, it is the primary component of stone, glass, concrete and cement; – in high R&D-intensive industries, it has important fields of use from the market of photovoltaic products to battery applications. Tantalum (Ta) A silvery metal that is very resistant to corrosion. Tantalum does not occur uncombined; it is usually found in its minerals containing niobium. The top producers are the Democratic Republic of the Congo, Rwanda, Brazil, and China. Uses: – in electronics: it is extensively used in the capacitors of electric devices (e.g. mobile phones), in high-capacity resistors, in the cathodes of X-ray tubes; – as it causes no immune response in mammals, it has found wide use in medicine as surgical implants, to replace bones (for example in skull plates) or connect torn nerves and muscles;

– it is very resistant to corrosion and so is used in s electrodes for neon lights or in the coating for special lenses; – its alloys are extremely strong, so are the components of turbine blades, rocket nozzles and nose caps for supersonic aircraft. Tungsten (W) This metal has the highest melting point and also high density; it is hard and an efficient electrical conductor. The principal tungsten-containing ores are scheelite and wolframite; the metal is mainly obtained from these (and 30 per cent of global reserves are from recycling). Its top producer is China, accounting for some 80 per cent of total production. In addition, tungsten is also mined in Austria, Bolivia, Canada, Peru, Portugal, Russia, Thailand and certain African countries (e.g. the Democratic Republic of the Congo). Uses: – it is alloyed with other metals to strengthen them; furthermore, tungsten and its alloys are used in many high-temperature applications, such as arcwelding electrodes and heating elements in hightemperature furnaces; – in electronics, as coating of devices; in the manufacture of aircrafts, in medical technology, in equipment manufacturing, in the power industry; – tungsten carbide is immensely hard and is very important to the metal-working, mining and petroleum industries; – it is used in cutting and drilling tools (e.g. ‘painless’ dental drills). THE IMPORT RELIANCE OF THE EUROPEAN UNION Critical raw materials are in the focus of several strategic materials by governments and analyses by economic organisations, including the Trade and Agriculture Directorate of the OECD, which prepared a working paper on the export restrictions of strategic raw materials couple of years ago, focussing on its effects on trade and global supply. At regular intervals, the EU publishes a list of raw materials critical for the Union, based on supply risks and the significance of their impact on the economy. The latest such communication was issued in 2017

(previously, a similar communication was prepared in 2014 and 2011). “The primary purpose of the list is to identify the raw materials with a high supply-risk and a high economic importance to which reliable and unhindered access is a concern for European industry and value chains.” It helps the organs of the Union to identify investment needs which can help alleviate Europe's reliance on imports of raw materials; to guide support to innovation on raw materials supply; and draw attention to the economic importance of critical raw materials. The long-term objective is to incentivise the European production of critical raw materials, if possible; if it is not, to make reserves through recycling activities. A secure supply of raw materials is a strategic economic interest of the Union. This year’s list identifies 27 raw materials (and groups of raw materials) as critical (which is more than ever: in 2011, the list included only 14 items, and in 2014, it included 20), more than half of which (14) have an import reliance rate over 95 per cent. SUMMARY In the 21st century, the significance of the primary sector (including mining as well as agriculture), is often pushed into the background when it comes to economic issues; much greater emphasis is placed on the secondary sector (industry), the tertiary sector (services) and the quaternary sector (research and development, the “information industry”. We should remember, however, that raw materials play a very important role in global value chains, since they provide the basis of industrial production (and the devices produced by the industry provide the basis for commerce and other services, as well as further research and development). It is exactly modern technology and various industrial innovations that drive demand for various raw materials and make them increasingly important. The above list presenting a comprehensive overview reveals that the production of many of these strategic raw materials is concentrated in only a few countries, which may have important geoeconomic implications; consequently, the consideration of these factors must be given an important role in the economic strategy of every country. Even today, in the 21st century, access to resources still provides an important basis for economic development.

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The 6th Summit of Central and Eastern European Countries and China

The Budapest Guidelines 160

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The Budapest Guidelines Author: Viktor Eszterhai

The 6th Summit of Heads of Government of Central and Eastern European Countries and China was held in Budapest on 27 November 2017. This analysis aims to present the main events of the “16+1 Cooperation” on the basis of the Budapest Guidelines drafted at this meeting. In the first step, this analysis examines the stances taken in the Preamble, and then it discusses the points adopted by the Member States.

Preambulum The most significant forum of the “16+1 Cooperation” is the Summit of the Heads of Government of 16 Central and Eastern European Countries (CEE) and China, which is arranged every year. According to the Budapest Guidelines, each country was represented by their Heads of Government, except for Albania and Romania represented with their Deputy Heads of Government. This reflects that the Summit is actually judged as a high-priority regional event by the countries of the CEE and the cooperation has become one of the key political forums in the region. NAME Viktor Orbán Li Keqiang Denis Zvizdic Boyko Borissov Andrej Plenkovic Bohuslav Sobotka Jyri Ratas Maris Kucinskis Saulius Skvernelis Zoran Zaev Dusko Markovic Beata Szydlo Ana Brnabic Robert Fico Miro Cerar Senida Mesi Paul Stanescu

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Participants at the 6th Summit of Heads of Government of Central and Eastern European Countries and China. Besides these 17 countries, representatives of Austria, Belorussia, Greece, Switzerland, the European Bank for Reconstruction and Development and the European Union were also present as observers. The involvement of these countries and institutions is not a coincidence. Given the heritage of the Habsburg Empire, too, Austria traditionally fosters a close relationship with the region, and the idea of involving the country in the mechanism has already popped up thanks to

COUNTRY Hungary China Bosnia-Herzegovina Bulgaria Croatia the Czech Republic Estonia Latvia Lithuania Macedonia Montenegro Poland Serbia Slovakia Slovenia Albania Romania

POSITION Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Head of Government Deputy Head of Government Deputy Head of Government

the active economic relations. The attendance of Belorussia can be justified for two reasons: first, it also has a close relationship with the neighboring CEE, connecting the region to Russia as a natural corridor. Second, the country itself is also a significant site of Chinese investments. The presence of Greece was not a surprise either: several of its neighbors are active participants of the “16+1 Cooperation”, while Greece is directly involved in one of the flagships of the mechanism, the Budapest-Belgrade railway, as the railway line would connect the Port of Piraeus with the market of the EU. The Swiss interest is due to the tight economic relation maintained with the CEE Region and the potential investment facilities of the “16+1 Cooperation”. The attendance of the European Union is also evident because 11 countries out of the 16 CEE countries are EU Member States. On the other hand, involving the EU in the mechanism as an observer might decrease the skeptical judgement against the mechanism among certain EU decision-makers. The primary interest of the European Bank for Reconstruction and Development is to find interesting projects for investments, coordinating them with the European Commission’s Infrastructure Development Program (European Commission’s Investment Plan for Europe), better known as “the Juncker Plan”).

The Budapest Guidelines put special emphasis on the Budapest venue of the 6th Summit (Warsaw, Bucharest, Belgrade, Suzhou, Riga), so the fiveyear-period is perfect for checking the earlier results. This is also reflected by the document listing the results of the five years (Five-year Outcome List of Cooperation Between China and Central and Eastern European Countries).It is important to highlight the results because there are voices that consider that the “16+1 cooperation” has not lived up to the expectations (the best-known example is that the trade between the CEE Region and China should have been increased to USD 100 billion by 2015 according to the plans, but it hardly exceeded USD 50 billion at the time of the target datevii). It is no coincidence that the Budapest Guidelines emphasize one should not focus only on economy when evaluating the cooperation because the relations of transport and logistics, culture and the human sector, which already have numerous results, are also important. The Budapest Guidelines highlight that the platform is committed to supporting multilateralism and international institutions such as the United Nations Organization and the World Trade Organization. This is significant because, on the one hand, similarly to the earlier guidelines published

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The Budapest Guidelines

annually, the participating states intend to ease the anxieties that China’s international institutionbuilding ambitions – as well as the “16+1 Cooperation” – undermine the role of international organizations. On the other hand, this is some kind of determination to the world, mainly in relation to the anti-globalization efforts in the USA, whose losers might be both China and the extremely open CEE Region. It is not by chance that according to the text the “16+1 Cooperation” aims to maintain the openness of the global economy. The Budapest Guidelines state that the “16+1 Cooperation” fulfils an important and positive role in the China-Europe relations and deepens the “comprehensive strategic partnership” between the EU and China”ix. This is of great importance because of the above-mentioned negative perception that can be experienced at EU decisional level with respect to the 16+1 Cooperation”. In light of the sources, criticism primarily has three aspects: the projects implemented under the mechanism do not entirely harmonize with the EU regulations; China’s regional presence challenges the exclusiveness of the Western model in the CEE Region; and finally, the mechanism undermines the unity of the EU. Therefore, the Budapest Guidelines highlight that they aim to establish a “united, stable and prosperous Europe”. To deepen trust, the Budapest Guidelines also state that the 16 CEE countries and China are committed to follow the strategic documents and objectives specifying the EU-China relations such as the EU-China Agenda 2020, the EU-China Connectivity Platform, the European Commission’s Investment Plan for Europe and the EU-China Comprehensive Agreement on Investment being discussed. The Budapest Guidelines lay down that the “16+1 Cooperation” is closely related to the “One Belt, One Road” plan, which was first announced by Chinese Premier Li Keqiang in Belgrade in 2014 and has been mentioned in the Guidelines every year since then. The “One Belt, One Road” is most popular among the CEE states as the infrastructure investments to be realized under this initiative are supposed to considerably improve the accessibility of the region, which will help them break free from their peripheric economic status. Second, it is essential for China that the CEE countries lay down their commitment towards the “One Belt, One

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Road” because its judgement, similarly to the “16+1 Cooperation”, is rather mixed within the EU, primarily for certain EU Member States such as Germany, so common front may form the EU attitude in the longer run.

that the “16+1 Cooperation” has not been established to undermine the international order or divide the EU but to exploit the mutual advantages.

The Budapest Guidelines has marked the main path to be followed in the future as follows: “deepening economic, trade and financial cooperation for win-win development”. This sentence contains two noteworthy aspects. First, the issue of the financial cooperation between the CEE and China is included, although it received less attention as an economic topic before. This change is primarily due to the fact

The 7 th Summit of the Heads of Government of Central and Eastern European Countries and China will be hosted by Bulgaria next year. Up to present, Bulgaria has belonged to the less active countries within the cooperation, which among others is due to its underdeveloped economic relations with China. The high-priority issues of the meeting to be held next year will probably include the Chinese export of agricultural products, because the sectoral coordination center for the “16+1 Cooperation” (16+1 Association for Agriculture Promotion) is located in Sofia.

that Hungary as host country has made the most significant financial progress in the bilateral relations with China, which the parties could assess as a model to be followed by the other 15 countries, too. China especially urges on the deepening of financial relations, partly owing to the central efforts to internationalize the RMB, and partly because it is relatively easy to achieve results in this fields, as the Hungarian example also shows, contrary to the endeavors to increase investment and trade, which are often hindered by the economic structural features of the 16 CEE countries. Second, one of the high-priority elements is the mutually beneficial principle of relations. Over the past years this issue has received considerable attention and criticism owing to the “16+1 Cooperation” for primarily serving the interests of China. Therefore, it is essential to emphasize the mutual benefits for the affected parties. Nevertheless, it is worth mentioning that the Chinese party does not necessarily interpret mutual benefits as equal share from the benefits, but it rather means that the relationship offers advantages to both parties, so China does not exclude that the implementation of a project would be more beneficial to China than its partners. It is also obvious that China is responsible for checking to what extent the CEE countries have their interests in mind (e.g. the feasibility of each project). Finally, the last article set forth in the Preamble of the Budapest Guidelines lists the above-mentioned norms concerning the “16+1 Cooperation”, including the principle of “transparency, fairness, reciprocity and mutual benefits”, which are entirely connected to the international norms and the EU’s legal provisions according to the document. This point is significant because the parties emphasize

POINTS ACCEPTED

Cooperation Plan and Coordination Concerning the topic of cooperation plan and coordination, the parties have agreed to further realize the purposes of the Medium Term Agenda and announced their need for the preparation of the plans concerning the 2021-2025 period, which is highly important for the future of the “16+1 Cooperation” with actual purposes to be implemented. The formalized process of the mechanism has been confirmed again, under which the so-called national coordinators will hold discussions in China in the first half of the year, and then the final decisions will be passed in the host country of the Summit in the second half of the year. No change has taken place in the decision preparation mechanism: the Ministry of Foreign Affairs of the People’s Republic of China prepares the points of the Summit through the Secretariat operating in Beijing, in consultation with the embassies of the countries involved. It is still an important feature of the mechanism that each country and their institutions continue to decide on joining its work on a voluntary basis. Trade and Investment As for trade, the Member States aim to keep on consolidating bilateral trade based upon the regulations of the World Trade Organization, while for the investments the EU-China Comprehensive Agreement on Investment to be adopted in the future shall apply. Both are significant partly because of the above-mentioned ambitions highlighting that China’s institution-building is not contrary to

the prevailing international order and enhancing the EU’s trust towards the “16+1 Cooperation”. In addition to that, the World Trade Organization is a well-organized and tested regulatory system that is known to the participating states, so the Organization can enhance the efficiency of the cooperation among the Member States of the “16+1 Cooperation”. However, referring to the rules of the World Trade Organization is definitely an implicit concession for the Chinese party, as it is not the World Trade Organization but the common trade system and policy of the EU that serves as the basic reference point for the 11 EU Members. Although the wording is justified with respect to the five non-EU Member States, it will not be satisfactory for Western Europe and the European Commission. The key role in coordinating and preparing the economic relations is still fulfilled by the China-CEEC Business Council. The parties support a large number of international exhibitions and events (e.g. China International Import Expo, China International Consumer Goods Fair). These are considerable for the CEE states primarily because they are provided an opportunity to promote their products towards potential Chinese partners, increasing the export of the CEE countries and decreasing their trade deficit with China, which criticism is often mentioned about the “16+1 Cooperation”. The Budapest Guidelines expressly highlight ecommerce as one of the potential fields of cooperation. E-commerce may offer mutual benefits: Chinese companies possess the services providing a platform for the small companies of the CEE countries to enter the Chinese and the global markets. Central and Eastern European SMEs, which are dominantly in national property but are often underdeveloped, are expected to be involved in the “16+1 Cooperation”; however, this objective has not been achieved yet in recent years. Actually, both the foreign trade deficit and the low-efficiency presence of the SMEs of the CEE countries arise from the economic structure of the region, so they cannot really be remedied by the accepted points. Connectivity The Budapest Guidelines confirm that the projects of the “16+1 Cooperation” - besides the “One Belt, One Road” - are harmonized with the relevant documents and institutions of the EU, including the EU-China Connectivity Platformvi,

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The Budapest Guidelines

the Trans-European Transport network (TEN-T) and the Eastern Partnership programs. Beyond economic rationality, another aim is to build trust within the EU, limiting the potentials of hindering the realization of the projects, as it happened during the first significant regional project, the reconstruction of the Budapest-Belgrade railway. In the longer run the Member States hope that the EU will have a more supportive stance, as the projects of the EU and the “16+1 Cooperation” overlap considerably. Concerning the actual projects, the Budapest Guidelines mentions the Budapest-Belgrade railway, stating that China, Serbia and Hungary took significant steps for its realization. Formally, launching the public procurement procedure for the restoration of the railway section in Hungary can be considered a milestone: a precondition for the implementation. The public procurement procedure was significant because earlier the European Commission had objected to the failure of this. Therefore, after the closing of the tender procedure the former obstacles can be eliminated and the construction may start in 2020. Other actual projects include a plan supporting the establishment of the railway connection between the Ports of Rijeka and Koper with Hungary, and – based upon the recommendations of the feasibility studies – the extension of the Belgrade-Budapest railway line through the Ports of Montenegro and Albania. The projects are related to the China-Europe Land Sea Express Line and the Port Area Cooperation, aiming to create a modern connection between the Baltic, the Adriatic and the Black Seas. To improve the relations of transportation, the “16+1 Cooperation” aims to make the standard of the connectivity service in the CEE more efficient by harmonizing border-crossing and customs rules, increasing the connectivity of the railway network and supervising the cooperation opportunities of the existing logistics centers. The parties realized that the customs regulations should be harmonized with the EU rules (EU-China Agreement on Cooperation and Mutual Administrative Assistance in Customs Matters,EU-China Strategic Framework for Customs Cooperationx) in order to increase efficiency. These high priority aspects can reduce the disadvantages arising from the fragmented infrastructure network of the CEE countries and the differing customs regulations of the EU and non-EU Member States.

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Cooperation on Industry, Energy, Science and Technology The Member States endeavor to enhance the earlier cooperation in the fields of industry, energy, science and technology under the coordination of Slovakia. The actual measures include the establishment of common laboratories (e.g. the virtual technological transfer center in Slovakia) and joint events such as the 3rd 16+1 Conference on Innovation Cooperation, which will be held in Sarajevo in 2018. For the reasons described earlier, the Budapest Guidelines have tried to strongly involve the SMEs in the industrial and technical cooperation, so the purpose of organizing a CEE-China International Small and Medium Enterprises Fair has appeared in China. Financial Cooperation One of the most central fields of the Budapest Guidelines is financial cooperation, which has been affected by the above-mentioned fact that out of the 16 CEE countries it was Hungary that had managed to make the most significant progress towards the deepening of financial relations with China. The second phase of the China-CEEC Investment Cooperation Fund was established, supplementing the first fund of a far more modest extent (nearly USD 0.5 billion). This activity is expected to be extended with the regional investments of the Silk Road Investment Fund, also including the CEE Region taking a central role, mainly in relation to the infrastructure investment opportunities of the Western Balkans Region. The China-CEEC Inter-Bank Association was founded, and the financial institutions of the affected states can join this Association on a voluntary basis. The Secretariat is directed by the China Development Bank, while the establishment of the regional coordination center is managed by the Magyar Fejlesztési Bank. Hungary’s leading role is shown by the fact that the China-CEEC Central Bank Governors' Meeting will be organized in Hungary in 2018. Agriculture, Forestry and Environment Protection Cooperation Undoubtedly, agriculture is one of the most successful fields of the “16+1 Cooperation”: China seems to be a proper market for the relatively cheap and high-quality products. Accordingly, the Budapest Guidelines lay special emphasis on

the promotion of regional products (e.g. China International Agricultural Products Fair, 13th

closing

China-CEEC Agrotrade and Economic Cooperation Forum, etc.). Successful presence requires the harmonization of national standards, quality and health requirements. In order to access the market more efficiently, the affected parties will examine the possibility of supporting sales on e-commerce platform for the distribution of their products. Finally, the parties promote the establishment of an International Agricultural Demonstration Park in Bulgaria (Plovdiv), which serves as the regional coordination center for the “16+1 Cooperation” in the field of agriculture.

Finally, the Budapest Guidelines summarizes how the plans announced in Riga in the previous year have been realized. This is a highly important feedback mechanism to the “16+1 Cooperation” that shows the depth of the cooperation and facilitates the establishment of realistic objectives in the future.

People-to-People Contacts Regarding the numerous cultural, educational, scientific and tourism exchange programs, the Budapest Guidelines clearly highlight exchange programs related to the media (e.g. Year of ChinaCEEC Media Cooperation). The exchange of youngsters and young leaders is also important because it is a precondition for the consolidation of the “16+1 Cooperation”. The Member States have agreed that the deepening of tourism relations necessitates the representation of the CEE States as a single brand name. This suggests that the Member States start to prefer collaboration among small states in the competition for Chinese tourists rather than fighting alone with each other or countries regarded as larger tourism destinations. Health Cooperation As for health, Budapest Guidelines devote special attention to the “16+1 Cooperation” as the forum of the international distribution of traditional Chinese medicine. In addition to that, it has been recorded that the CEE Region might play an important role in the cultivation and production of Chinese medicinal herbs. All this urges on the deepening of the regulation, whose institutionalization will be outlined under the China-CEEC Drug Regulatory Cooperation Forum hosted by the Czech Republic in 2018. Local Cooperation Concerning local relations, one of the high-priority issues of the Budapest Guidelines is the deepening of the relations between local governments and local enterprises, with numerous forums such as the 3rd China-CEEC Capital Mayors Forum in Serbia.

summary To sum up, it can be stated that the “16+1 Cooperation” has become a key institution within the CEE Region and its importance is obvious on the basis of the Budapest Guidelines, too. The investigation of the Budapest Guidelines clearly reflects the development of the past years, including the problems and challenges to be shown and the further possible development trends. Despite the criticism received from outside and inside, the “16+1 Cooperation” has become an institutional framework whose use is more and more beneficial for the participating states.

“To sum up, it can be stated that the “16+1 Cooperation” has become a key institution within the CEE Region and its importance is obvious on the basis of the Budapest Guidelines, too. The investigation of the Budapest Guidelines clearly reflects the development of the past years, including the problems and challenges to be shown and the further possible development trends.” 167

A NEW ERA FOR RAIL FREIGHT TRANSPORT BETWEEN CHINA AND EUROPE

Map of the New Silk Road project

Author: Nóra Anna Sándor

The Chinese project called One Belt One Road – OBOR was announced by President Xi Jingping in 2013, and one aim of the infrastructure investments is to strengthen China’s trade and investment relations with Europe, Central Asia, the Middle East and Africa. Within the frameworks of OBOR, China is planning to invest approximately US$1,000 billion in railway, port and road building projects, and trade with countries participating in the initiative reached US$913 billion in 2016. OBOR is the greatest infrastructure investment project ever; a programme of such significance has never been launched by any country.

Adequate logistics is essential for such a complex plan connecting countries and encompassing continents. The China Railway Express (CRE), linking China to Europe, is an essential element of the New Silk Road (One Belt One Road – OBOR). In order to stimulate the economic and trade relations between China and Europe, and to accentuate their importance, the Chinese government issued a White Book in March, 2015. The name ‘China Railway Express’ was first used for Europe-bound trains officially on 8 th June, 2016. As part of the 13 th Five-Year Plan, China is planning to spend 3,500 billion yuans on building railway networks between 2016 and 2020. For 2017, the Chinese government earmarked US$115 billion in their budget for railway developments. Rail freight transport has numerous advantages: goods transported by CRE reach their destinations three times faster than by sea, and cost a fracture, only one-fifth, of air transport. In order to enhance cooperation with China, Belarus, Germany, Poland, Kazakhstan, Mongolia

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and Russia signed the first CRE agreement on the China Railway Express to increase the efficiency of rail transport, on 20 th April, 2017. The first direct Sino-European freight train set off from Chongqing to Duisburg, Germany in March, 2011, marking a new era for rail freight transport, as demand has enormously increased since the service commenced. On the basis of the data of the National Development and Reform Commission on 22nd January, 2018, 3,673 trains set off from China to Europe in 2017, which represents a growth of 116 per cent compared to 2016. By the end of 2017, CRE transport routes linked 38 Chinese cities to 36 European ones in 13 countries. With the help of CRE, bilateral relations between countries strengthen along OBOR, and investors can explore new investment opportunities. While earlier the China Railway Express was exclusively used for export activities, in recent years its import potential has also been discovered.

Source: https://gbtimes.com/chinas-belt-and-road-initiative-explained

CRE could primarily make trade relations between China and Europe, as well as China and Central Asia prosper. It might help Chinese companies enter new Asian markets, and SinoEuropean trade, which is already considerable, could further strengthen. The project called One Belt One Road – OBOR was announced by President Xi Jingping in 2013, and is expected to strengthen China’s trade and investment relations with Europe, Central Asia, the Middle East and Africa. OBOR is historically the biggest foreign investment project by any single country in world history. The word ‘Belt’ refers to the relations between China and Europe, Central Asia, Russia, Southeast Asia, South Asia, while the word ‘Road’ refers to a sea route designed to link China’s coastal cities to Europe and Africa. Altogether OBOR covers 65 countries, connects almost 4.4 billion people, and these combined account for nearly a third of the world’s GDP. In order to promote the project, China has established a new financial institution, namely the Asia Infrastructure Investment Bank – AIIB, which

is a multilateral development agency, with the primary aim of promoting Asia’s development, although its activity is not limited to the continent. Within the OBOR framework, China is planning to invest US$1,000 billion in building railways, ports and roads, and trade with countries participating in the initiative reached US$913 billion in 2016. The international recognition of One Belt, One Road is also demonstrated by the fact that so far over 100 countries and international organisations have signalled their intention to join the initiative, and China has signed more than 40 Cooperation Agreements under OBOR. The results of the OBOR project announced in 2013 have surpassed all expectations. In 2016, Chinese companies invested US$14.5 billion in the countries along the New Silk Road and the 21 st-Century Maritime Silk Road, creating some 180,000 jobs, and their tax income amounted to US$1.1 billion. Trade relations between China and Europe have a decisive role in China’s economy, as in the first six months of 2017 the EU trade balance with China was 1,9700 billion yuans, thus the EU is China’s

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A NEW ERA FOR RAIL FREIGHT TRANSPORT BETWEEN CHINA AND EUROPE

largest trading partner. Within the European Union, the largest export partner is Germany. China is the second largest export partner of the European Union, although the EU currently has a trade deficit with China; the value of the deficit is approximately US$190 billion. THE INSTRUMENT OF THE NEW SILK ROAD: CHINA RAILWAY EXPRESS The China Railway Express (CRE), linking China and Europe, is an essential element of the New Silk Road (One Belt One Road – OBOR). The first direct Sino-European freight train set off from Chongqing to Duisburg, Germany in March, 2011, marking a new era for rail freight transport. With the help of CRE, bilateral relations between countries strengthen along OBOR, and investors can explore new investment opportunities. Therefore, CRE could primarily make trade relations between China and Europe, as well as China and Central Asia prosper, it might help Chinese companies enter new Asian markets, and SinoEuropean trade, which is already considerable, could further strengthen In order to stimulate the economic and trade relations between China and Europe, and to accentuate their importance, the Chinese government issued a White Book entitled “Joining Hands to Build a Silk Road Economic Belt and a 21stCentury Maritime Silk Road – Vision and Actions” in March, 2015. The name ‘China Railway Express’ was first used for Europe-bound trains officially on 8 th June, 2016. In terms of budget, China is taking the development of the railway network very seriously: as part of the 13 th Five-Year Plan, China is planning to spend 3,500 billion yuans on building railway networks between 2016 and 2020. For 2017, the Chinese government earmarked US$115 billion in their budget for railway developments. In order to enhance cooperation with China, Belarus, Germany, Poland, Kazakhstan, Mongolia and Russia signed an agreement on the China Railway Express to increase the efficiency of rail transport, on 20 th April, 2017. This was the first CRE agreement arranged under One Belt, One Road. The agreement also contains provisions for simplifying customs clearance procedures and setting unified service standards.

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By the end of 2017, CRE transport routes linked 38 Chinese cities to 36 European ones in 13 countries. The network has been continuously expanding recently: • A new freight route between China and Germany was launched on 13 th October, linking the city of Changchun in Northeast China to Hamburg. It will take between 12 to 15 days to reach Germany, and the train will mainly transport automobile parts, electronic equipment and textiles via Russia, Belarus and Poland. • O n 27 th October, 2017, a freight train set off from the port city of Dalian in Northeast China, which arrived in Bratislava, the capital of Slovakia on 13 th November, 2017, after having covered 10,537km. This is the first direct railway link between China and our northern neighbour. Loaded with electronic products, machinery parts and light industrial products, the train reaches Slovakia via Russia and Ukraine. • O n 28 th October, 2017 a 41-container freight train left Wuhan, China loaded with electrical products and sportswear heading for the city of Dourges, France. On this route, travel time is expected to be between 16 and 18 days, compared with 20 days by boat—a significant reduction. • O n 29 th October, another freight train set off from Ürümqi, Northwest China (the capital of the Xinjiang Uyghur Autonomous Region) to Poltava, Ukraine via Kazakhstan and Russia. Travel time dropped from two months (by sea) to 15 days. This is the first freight route between Ürümqi and Ukraine, from which companies operating in the Chinese city could also benefit, and the markets of OBOR countries will be easier to reach. By the end of 2017, the number of Europe-bound trains from Ürümqi might reach 700. • At the beginning of November, 2017, the CRE network expanded with another European destination: Kouvola, Finland was also added to the list. This is one of the fastest routes of current European destinations, goods reach Finland from China in only 10 days. Not only is the route important for Finland’s economy, but entire Scandinavia will significantly benefit from it. • R ail freight transport has been possible from Guangxi Zhuang Autonomous Region in Southwest China to the city of Małaszewicze, Poland since the end of January, 2018, as a freight train

Expansion of the China-Europe freight train service

Source: http://hkmb.hktdc.com/en/1X0A7UXL/hktdc-research/China-Europe-Express-Trains-On-Track-to-AccessBelt-and-Road-Businesses

loaded with mainly electronic electrical products and sheet metal left the city of Qinzhou on 17 th January. The trip, with a total length of some 11,000 kilometres, will take 18 to 20 days, which is 12 days shorter in comparison with marine transportation. • A new direct railway link between the coastal city of Xiamen, Southeast China and Budapest was established at the end of January. The first freight train set off on the 11,595km journey to Budapest, which takes 18 days, on 19 th January, carrying about 3.5 million US dollars of goods, including electric products, clothes, shoes and construction materials. According to statistics from the National Development and Reform Commission published on 22 nd January, 2018, 3,673 freight trains travelled between China and Europe in 2017, an increase of 116 percent compared to 2016. Leaving Yiwu, Chinese export arrives in several countries in the Middle East and Africa. Since its debut in November 2014, this route has operated 131 trips as of March, 2017. The city of Wuhan is particularly important for China because goods arrive in China’s heartland through this gateway. Since the Wuhan route was inaugurated five years ago, in 2012, more than 450 trains have made the journey to Europe. The Yiwu-Madrid route is famous for making Madrid one of the largest European distribution centres of Chinese goods. On 2 nd April, 2017, the China Railway Express also left Xi’an for Budapest, introducing Hungary to the bloodstream of the New Silk Road. Most of

The characteristics of the major European lines of the China Railway Express are as follows: • Chongqing to Duisburg, Germany: 11,179km; 14 days. • Chengdu to Łódź, Poland: 9,826km; 10 days. • Zhengzhou to Rotterdam, the Netherlands: 12,000km; 15 days. • Zhengzhou to Hamburg, Germany: 10,399km; 17 days. • Zhengzhou to Kouvola, Finland: 8,000km; 10 days. • Changchun – Hamburg, Germany: 12-15 days. • Linfen – Munich, Germany: about 10,000km; about 10 days. • Suzhou to Warsaw, Poland: 11,200km; 12 days. • Wuhan to Lyon, France: 11,300km; 15 days. • Wuhan – Dourges, France: 10,815km; 16-18 days. • Changsha to Duisburg, Germany: 11,808km; 18 days. • Yiwu – Prague, the Czech Republic: 16 days. • Yiwu to Madrid, Spain: 13,052km; 21 days. • Yiwu – London, United Kingdom: 12 000km; 15 days. • Xi’an – Budapest, Hungary: 9,300km; 17 days. • Dalian – Bratislava, Slovakia: 10,537km; 17 days. • Ürümqi – Poltava, Ukraine: 15 days. • Xi’an – Kouvola, Finland: 9,000 km; 17 nap. • Xiamen – Budapest, Hungary: 11,595 km; 18 says. • Guangxi Zhuang – Małaszewicze; Poland: 11,000 km; 18-20 days.

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Corridors and main lines of CRE (May, 2016)

Rail transport, however, is still more expensive than sea shipping, and, studies suggest, accounts for 7 per cent of global greenhouse gas emissions, but taking considerable reductions of travel time and less loss into consideration, many companies opt for rail freight transport over shipping by sea.

trains departing from and returning to China are imbalanced: trains are coming back to China from Europe half-empty.

Services provided by the China Railway Express have become very popular both in China and abroad in recent years; the trains are eco-friendly, reliable, punctual and safe. Thanks to all these, more than 1,700 trains left for Europe in 2017, covering a total of 17 million km. China’s future plans include linking East Asia and Southeast

Communist Party National Congress, the Central Committee of the Communist Party of China (CPC) proposed incorporating Xi Jinping Thought on Socialism with Chinese Characteristics for a New Era into the Constitution of China, and also produced a blueprint for the country’s future economic reforms and development directions until 2050.

Asia with the help of the Sino-European freight transport lines, and boosting trade relations. Source: http://www.ceec-china-logistics.org/data-bank/images/docs/9/72/1_China%20Railways.pdf pp.4.

the cargo consisted of toys, electronic products and household items. During the journey, the train passed Kazakhstan, Russia, Belarus and Poland before reaching Budapest. The aim of the railway line is to create easier access for products from Xiamen and southeast Asia to travel to European markets. Trains will leave Xiamen for Budapest on a weekly basis, every Friday. CRE has three strategic corridors: • M anzhouli in Inner Mongolia, the “Eastern Corridor”; • E renhot in Inner Mongolia, the centre, • t he cities of Alashankou and Khorgos in the Xinjiang Uygur autonomous region. On the basis of data as of September, 2017, freight trains were in service on 52 routes through these three corridors, covering 1,300km on a daily average, and with technical advancement, trains will be capable of increasing speed, reducing travel time to 10 days in the near future. Ürümqi, the capital of the Xinjiang Uyghur Autonomous Region is an extremely important transport hub in the goods transport between China and Europe, and Chinese authorities expect 700 China-Europe freight trains to depart from Ürümqi by the end of 2017. 500 China-Europe freight trains have already headed westwards from the city this year, far more than the total number in 2016. With trade volume increasing

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between China and European countries in recent years, Ürümqi has started to offer "point-topoint" customized services. Interestingly, CRE was earlier used exclusively for exports activities, but its import potential has been tapped in recent years: in the first half of 2016, the CR Express operated 619 train services, of which 410 departed from China, and 209 returned from Europe. The major categories of export goods carried by the CRE trains include IT and other electronic products, machines, automobile parts, food products and textiles. Major import goods include wood products, food, agricultural goods, finished vehicles and automobile parts. A great advantage of CRE is that it provides not only direct railway transport to Europe from China, but also a one-stop service in cargo inspection, quarantine and customs clearance.

In order to promote even more efficient cooperation between China and Europe, customs clearance needs to be improved and customs need to be reduced. Shipping costs have decreased by 30 per cent compared to 2011; logistics costs, however, are relatively high as European rates are twice as high as Chinese ones. In addition,

Recent events of the domestic political scene may affect also the development of infrastructure, including the railway network. At the 19 th Chinese

In the next 20-30 years, China’s objective is to participate as a strong and rich country on the international scene, which requires maintaining and promoting economic growth, and introducing further market reforms. In order to accomplish all these objectives, the Chinese government’s short- and long-term goal is to develop the railway network to, on the one hand, satisfy growing demand, and, on the other and, strengthen trade between China and Europe.

BENEFITS OF RAIL FREIGHT TRANSPORT Rail freight transport has many benefits: CRE trains transport cargo to their destinations three times faster than shipping by sea, for a fracture, only one-fifth of the cost of transport by air, with much less environmental pollution. In addition, China Railway Express is extremely punctual, safe and environmentally-friendly. Air pollution in China presents a huge problem; therefore, the exchange of goods by rail will contribute to reducing air pollution, Xi Jinping thinks.

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THE CHINA-CEE INVESTMENT FUND, THE SILK ROAD FUND AND THE SINO-CEE FUND

Author: Zsófia Szabó

China intends to promote the development and infrastructure of the Eurasian region, and calls for a closer cooperation with their neighbours and countries along One Belt, One Road. Its aim may be – apart from the exchange of knowledge – to provide products, capital and associated services through the road networks to be built in the future. This aspiration has provided a good margin for the establishment of several investment funds in recent years. I. The China-CEE Investment Fund – 2013 Phase One: US$435 million; Phase Two: US$1 billion Operated by the Export-Import Bank of China. II. Silk Road Fund – 2014 Entire size of the Fund is US$40 billion, shareholders include SAFE (State Administration of Foreign Exchange), the China Investment Corporation, the Export-Import Bank of China and the China Investment Bank. III. Sino-CEE Fund – 2015 The Sino-CEE Fund was established with US$11.15 billion. It is operated by the Sino-CEE Financial Holding Corporation. I. INTRODUCTION OF THE CHINA-CEE FUND The proposal of establishing the China-Central and Eastern Europe Investment Cooperation Fund (the China-CEE Investment Fund) was first announced by former Chinese premier Wen Jiabao, who represented the State Council of the People’s Republic of China, appointing the Export-Import Bank of China as the Fund organizer. The aim of the Fund is to promote the economic development and contribute to the sustainable development of 16 Central and Eastern European

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countries participating in the 16+1 Cooperation. The initiative intends to strengthen the synergy of enterprises operating in China and the CEE region through capital support. 1st Phase: Chinese premier Li Keqiang announced the inauguration of the Fund in November 2013 during the second Summit of China and Central and Eastern European Countries. The Fund was incorporated in Luxemburg and is sponsored by the Export-Import Bank of China and the Hungarian Export-Import Bank. The first phase of the official operations of the China-CEE Investment Fund was closed with US$435 million (the targeted amount was US$500 million). 2nd Phase: On November 5th, 2016, during the Fifth China-CEEC Summit in Riga, it was announced that the second phase of the Fund totalling US$1 billion would be established and become operational in January, 2017. Administrative, management and advisory services are provided by China-CEE Management S.à r.l., which was registered in Luxemburg in November, 2013 and set up a branch office in Warsaw in 2016. INVESTMENTS The China-Central and Eastern Europe Investment Cooperation Fund primarily focusses on telecommunications, energy, manufacturing, education and

healthcare. The Fund is actively looking for the most competitive enterprises and projects. The Fund seeks to provide value-added services to its partners, and prepares risk assessments, cost calculations, growth plans to make the investments successful. A typical investment is between US$10 million -70 million. Investment region of CEE Equity Partners

CEE Equity Partners CEE Equity Partners is the investment advisor for the two China-CEE Investment Fund, which identifies potential partners, specifies investment opportunities, facilitates liaising and provide clients with information. • Size of Fund (1st phase): US$435 million • Size of target companies: companies with EBITDA over HUF1 billion • Invested amount: minimum EUR15 million • Investment period: 3–7 years • Investment region: Central and Eastern Europe, primary target countries include Albania, Bosnia and Herzegovina, Bulgaria, Croatia, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Macedonia, Montenegro, Poland, Romania, Serbia, Slovakia and Slovenia. • Investment strategy: A conservative private equity investor: majority shareholding in and, in certain cases, significant minority ownership of companies with a market share in industries capable of generating calculable cash flows.

1. Polenergia – August, 2014 – Poland Polenergia is a group in the power industry functioning in the area of generation of power from conventional and renewable sources, as well as distribution. It has a total of 369 MW of installed capacity, of which approximately 66 per cent, i.e. 245 MW come from wind farms. In addition, the company also owns and a gas turbine power plant and a number of other small scale energy projects. Polenergia has local energy distribution networks across Poland, as well as an energy trading company. Kulczyk Investments S.A. holds a majority stake of 50.2 per cent, but the China-CEE Fund invested in the group in August, 2014, and now holds 15.99 per cent of its shares. 2. Wroblew Wind Farm – September, 2014. – Poland The China-CEE Fund and another company, Enlight acquired 50.1 per cent and 49.9 per cent of the wind farm in Wroblew, Poland respectively. The wind farm was developed by GEO Renewables. The investment had two phases: the first phase of developing a 36 MW wind farm finished at the end of 2014. During the second – much more large-scale – phase the capacity of the wind farm was expanded by 214 MW. 3. Budapest Metropolitan University – December, 2014 – Hungary The China-CEE Fund became a majority shareholder of the Budapest Metropolitan University (former BKF University of Applied Sciences Budapest) in December, 2014, enabling the University to launch new courses, host more foreign students and improve the quality of its English-language training courses. 4. Electronic Control Systems S.A. – January, 2015 – Poland Electronic Control Systems provides engineering and turnkey services for the telecommunications sector

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THE CHINA-CEE INVESTMENT FUND, THE SILK ROAD FUND AND THE SINO-CEE FUND

(building networks and installations) both in Poland and abroad. The China-CEE Fund, advised by CEE Equity Partners, invested in the company in January, 2015. 5. K orytnica Wind Farm – March, 2015 – Poland Korytnica is one the largest wind plants in Poland and supplies power to Warsaw, Poland’s capital city. 6. Southern Wind Farm – June, 2015 – Poland The China-CEE Fund invested in the 30 MW Southern Wind Farm located in Zopowy, Poland in June, 2015. The farm t utilizes 2MW G90 wind turbine generators, made by Gamesa, now part of Siemens. 7. Bioton S.A. – July, 2015 – Poland In July, 2015, the China-CEE Fund acquired 13.2% of shares in Warsaw Stock Exchange listed Bioton S.A., a biotechnology company that specialises in drug development and manufacturing, with its current core products being recombinant human insulin and diet supplements. It currently sells in Poland, China, Russia, Thailand and Egypt, among others. 8. Walltopia – August, 2015 – Bulgaria In August, 2015, the China-CEE Fund obtained the minority ownership of Walltopia, the world leader in climbing wall design and manufacturing. This was the Fund’s first investment in Bulgaria. 9. E nergy 21 – December, 2015 – the Czech Republic In December, 2015, the China-CEE Fund invested in Energy 21, the leading operator of photovoltaic plants in the Czech Republic with a capacity of 61 MW. 10. Javna Razsvetljava – December, 2016 – Slovenia In December, 2016, the China-CEE Fund acquired Javna Razsvetljava a Slovene company principally engaged in design and implementation of public lighting and signalling solutions. 11. Invitel – January, 2017 – Hungary In January, 2017 The China-CEE Fund signed an agreement with the Invitel Group on purchasing a majority stake in the Group.

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The annual revenues of the Invitel Group, established in 1992 and employing almost 1,200 people, reach some HUF45 billion, and its EBITDA amounts to HUF14 billion. The current owners of the parent company of the Invitel Group include Hungarian Telecom B.V., Mid Europa Partners and numerous other financial investors. The Group consists of two core pillars: Invitel Telecommunications Zrt., which offers television, Internet and phone services to retail and SME customers; and Invitech Solutions Zrt., which provides professional, services in the corporate, IT and telecommunications market. The agreement on a corporate value of HUF63 billion will probably be closed in the first quarter of the year, following approvals by the Competition Authority and shareholders. Silk Road Fund

Logo of the Silk Road Fund On 8th November, 2014, Chinese President Xi Jinping announced that China would contribute US$40 billion to establish the Silk Road Fund. The Fund was officially established in Beijing on 29th December, 2014. Investors include SAFE (State Administration of Foreign Exchange), the China Investment Corporation, the Export-Import Bank of China and the China Development Bank. The Silk Road Fund provides investment and financial support for the implementation of the goals of One Belt One Road (OBOR), in collaboration with domestic and international enterprises and financial institutions. The Silk Road Fund is different from other state-owned funds as it will operate as business based on market principles, seeking return on investment. The Fund has a total capital of US$40 billion, which will be fed into the system through multi-stage capital instalments. The total value of the first instalment is US$10 billion, and is allocated as follows: • Investment period: supporting medium- and longterm (10-15 years) development and investment projects; • Investment target areas: infrastructure, resource and energy development, cooperation based on

The first instalment – US$10 billion

industrial capacity (linking demand and supply), financial investments. The activities of the Silk Road Fund include, but are not be limited to the following: ACTIVITY Hydro power project – Pakistan Xi Jinping announced the first investment of the Fund during his visit to Pakistan on 20 th April, 2015, which did not represent only a step forward in the cooperation of neighbouring countries, but also marked a milestone in the bilateral strategic cooperation of the two countries, and was an important element of the CPEC (China-Pakistan Economic Corridor) initiative. The investment contributes to Pakistan’s energy supply through the development of hydro power production, and includes the Karot hydropower project. In September, 2016, the Private Power and Infrastructure Board (PPIB) and Karot Power Company signed the implementation agreement for the development of the project costing US$1.68 billion. The coasts are shared by the Silk Road Fund, the ExportImport Bank of China, the China Development Bank and other investors. Development is based on BOOT ("Build-Own-Operate-Transfer) strategy, and expected to last 30 years, after which ownership will be transferred to the government of Punjab, Pakistan’s most populated province. Cooperation with EBRD A cooperation agreement has been reached between the European Bank for Reconstruction and Development (EBRD) and the Silk Road Fund, to support the development of the One Belt, One Road initiative. A Memorandum of Understanding (MoU) was signed in Beijing on 15th June, 2016, in which the parties agree to boost cooperation at an institutional level and to

inform each other of any potential co-investment opportunities. Phil Bennett, EBRD First Vice President, said at the signing, “Today’s Memorandum is a new step in an already close working relationship with the Silk Road Fund (…). Our regions have a funding gap of about US$ 400 billion a year for necessary infrastructure investments”, and the partnership with the Silk Road Fund is part of the effort to bridge that gap. Yamal LNG – Russia The Chinese Silk Road Fund acquired a stake of 9.9 per cent in Yamal LNG, a comprehensive Russian project engaged in natural gas production, liquefaction and shipping in March, 2016. The stake was purchased from Novatek, which now owns 50.1 per cent of shares, while Total and CNPC hold 20 per cent each. As part of the transaction, in December, 2015, Novatek received a 15-year credit line worth of EUR730 million from the Silk Road Fund in order to fund the Arctic LNG project. The development of the LNG project is scheduled to start in 2017. SIBUR Holding – Russia In December, 2016, the Silk Road Fund and SIBUR, the largest gas processing and petrochemicals group in Russia, signed an agreement on the on the acquisition of a 10 per cent stake in SIBUR. “The fact that a financial institution as large as the Silk Road Fund became a shareholder of SIBUR confirms the investor appeal of the Company and strengthens its positions in the international market", Leonid Mikhelson, Chairman of SIBUR’s Board of Directors commented. SINO-CEE FINANCIAL HOLDING CORPORATION – SINO-CEE FUND During the 4th China-CEEC Summit in Suzhou in November, Premier Li Keqiang proposed the establishment of a Central and Eastern European Fund, as the region is a transit region due to its geographical location and plays a key role in the implementation of the OBOR strategy. In line with the One Belt, One Road strategy, the plan was published in May, 2016, according to which the Asia unit of the Industrial and Commercial Bank of China Ltd (ICBC) was setting up the Sino-CEE Financial Holding Corporation with an equity of US$1.1 billion. The primary aim of ICBC is to support infrastructure and cooperation

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projects as well as the expansion of Asian banks in CEE countries. The company was registered in Hong Kong on 14th August, 2016, and its establishment was officially announced on 5th November, after the 5th China-CEE Summit in Riga, by China’s Premier Li Keqiang and Latvia’s Prime Minister Maris Kucinskis. The main aim of the company is improving cooperation in manufacturing and infrastructure with, among others, the products of Chinese suppliers. Li Keqiang said that large amounts will be injected into the company, but did not unveil the specific sum. “China has signed memorandum of understanding with Poland and Czech to make contributions to the financial holding company and other CEE countries are welcome to join us,” Li said. The Premier vowed that China is ready to use more yuan and euros to promote the company’s financing capacity in the international market, meanwhile Chinese financial institutions such as the Silk Road Fund will support China-CEE projects in forms of equity and bonds. So far, Hungary, Poland, the Czech Republic and Latvia have indicated their financial contribution to the Sino-CEE Fund, the representatives of ICBC informed. Maris Kucinskis added that financial cooperation is still a shortcoming for China-CEE cooperation and it takes more time to establish an interbank consortium that is able to better finance joint projects. On 6th November, 2016, ICBC announced the establishment of an US$11.15 billion investment fund, run by the Sino-CEE Financial Holding Corporation. The fund will be government-backed but will be guided by the market, aiming to raise 50 billion euros in project finance for sectors such as infrastructure, high-tech manufacturing and consumer goods, ICBC said in their statement. ACTIVITY 1. ERICEE – Economic Research Institute of Central and Eastern Europe The Economic Research Institute of Central and Eastern Europe (ERICEE) was jointly established by the Sino-CEE Fund and the China-Europe International

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Business School (CEIBS) in Shanghai on 23rd January, 2017, under the umbrella of the CEIBS Lujiazui Institute of International Finance. The ERICEE aims to do research primarily in the areas of economy and finance of the 16 CEE countries and carry out in-depth studies into the political, historical ethnical, cultural, religious and other areas of the region. Another aim is to provide information and background material, publish research papers and produce reports primarily for the leaders and partners of CEIBS, a CLIIF, and the Sino-CEE Fund. In addition, the activities of the research institute will embrace the expansion of the think tank network, communication between educational institutions of CEE countries and organising seminars on CEE. The Economic Research Institute of Central and Eastern Europe, established by the China-CEE Fund and CEIBS, was launched during a ceremony attended by representatives from Hungary, Poland, the Czech Republic and Latvia. Chairman of the Sino-CEE Fund Dr Jiang Jianqing, who is the former Chairman of ICBC, has been appointed Chairman of the Board of ERICEE, while CEIBS President Professor Li Mingjun has been appointed Vice-Chairman. • Agreements between CEIBS and CEE universities CEIBS has signed agreements with five business schools, the projects will be overseen by the newly launched Economic Research Institute of Central and Eastern Europe. The collaboration between CEIBS and the five schools will focus on research and teaching activities. Under the agreements, CEIBS will collaborate with: – Corvinus Business School (CBS), Corvinus University of Budapest, in Hungary – BMI Baltic Management Institute, in Lithuania – Kozminski University, in Poland – The Faculty of Economics Ljubljana University (FELU), in Slovenia and – The Faculty of Business Administration (FBA) at the University of Economics, Prague, in the Czech Republic.

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An Introduction to the ChinaCEEC Think Tanks Network Origin On December 16th 2014, Chinese Premier Li Keqiang attended the 3rd Meeting of Heads of Government of China and CEECs in Serbia. The Belgrade Guidelines for Cooperation between China and Central and Eastern European Countries affirm that all parties support the establishment of the China-CEEC Think Tanks Exchange and Cooperation Center. On November 24th, 2015, the 4th Meeting of Heads of Government of China and CEECs was held in Suzhou, China. The participants jointly formulated and issued the Suzhou Guidelines for Cooperation between China and Central and Eastern European Countries which clearly stated that all sides welcome the Chinese Academy of Social Sciences in leading the efforts to establish the China-CEEC Think Tanks Exchange and Cooperation Network. The Chinese Academy of Social Sciences (CASS), as the top think tank in China, has been actively playing an important role in the cultural and people-to-people exchanges between China and CEECs. The ChinaCEEC Think Tanks Exchange and Cooperation Network (shorted as "16+1 Think Tanks Network”) aims to integrate China's research institutes to establish a tracktwo think tank platform under the framework of the China-CEEC Cooperation (shorted as "16+1 Cooperation”). It Will dedicate to promoting exchange and cooperation between think tanks from China and CEECs through consultation and communication. On December 16th, 2015, the 3rd High-Level Symposium of Think Tanks of China and Central and Eastern European Countries was held in Beijing. During the symposium, 16+1 Think Tanks Network was formally launched. Liu Haixing, the Assistant Foreign Minister of China, Mr. Victor Ponta, the former Prime Minister

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of Romania, Professor Wang Weiguang, the President of CASS and Professor Cai Fang, the Vice-President of CASS, opened the Network together. Position The 16+1 Think Tanks Network is an international coordinating mechanism and high-level exchange platform for think tanks from China and CEECs. It is one of the most professional and high-level think tanks supported by the Chinese government, the Ministry of Foreign Affairs in particular. The Network Will integrate not only all the related research institutes and centers from CASS, but also other think tanks from China and CEECs, and actively work with the "Belt and Road Initiative”, so as to coordinate and promote the 16+1 Cooperation. Functions 16+1 Think Tanks Network Will take advantage of the comprehensiveness of disciplines and Strong network of CASS to promote the exchange and cooperation among different institutes in CASS, other institutes and think tanks from China and CEECs, and more importantly, to enhance the 16+1 Cooperation in a wide range of fields including economy, society, politics, culture, energy and security. To this end, its functions cover think tanks exchanges, policy consultation, field study, joint research and courses for younger generation. Operation 16+1 Think Tanks Network actively proposes projects that require in-depth study, organizes round tables, dialogues or seminars and timely releases research findings. 16+1 Think Tanks Network constantly offers

policy advice related to the 16+1 Cooperation to governments, domestic academic institutes and enterprises. 16+1 Think Tanks Network increasingly strengthens the communication and exchanges with high-level think tanks from CEECs and fully exploits its functions of coordination and organization through joint projects, bilateral or multilateral dialogues, field works, professional training and courses, and translation and publication of findings to boost the 16+1 Cooperation. Leadership Wang Weiguang is the President of 16+1 Think Tanks Network. Professor Wang is the President of CASS and Chairman of the Academic Divisions Presidium in CASS. He received a doctoral degree in philosophy and is a professor, a PhD supervisor, and a Member of the Academic Divisions Presidium in CASS. He was one of the alternate members of the 17th Central Committee of CPC and is a full member of the 18th. Wang was honored "Chinese Doctorate Recipient with Outstanding Contribution” by the State Council. Cai Fang is the Executive Vice-President of 16+1 Think Tanks Network. Also he is the Vice-President of CASS, and the Committee Member of the Academic Divisions Presidium in CASS, former Director-General of the Institute of Population and Labor Economics, CASS. He also serves as a deputy to the 18th National Congress of the Communist Party of China and member of the 12th National People's Congress Standing Committee. Huang Ping is the Secretary-General of 16+1 Think Tanks Network. Also he is the Director General of the Institute of European Studies (IES), CASS, President of Chinese Association of American Studies, VicePresident of Chinese Association for European Studies, Vice-President of China National Association of International Relations, Vice-President of Chinese Association of World Politics Studies and Co-Chair of the European Institut Transcultura. Activities On December 16th, 2015, the 3rd High-Level Symposium of Think Tanks of China and Central and Eastern European Countries was held in Beijing. The symposium was sponsored by Chinese Academy of Social Sciences, the Secretariat for Cooperation between China and Central and Eastern European Countries and the China Foundation for International Studies,

during which the 16+1 Think Tanks Network was formally launched. On December 17th, 2015, the first workshop of 16+1 Think Tanks Network was held in the Institute of European Studies, Chinese Academy of Social Sciences (IES, CASS). About 50 representatives from CEECs and China's think tanks and local governments attended the workshop. On December 17th, 2015, the first council meeting of 16+1 Think Tanks Network was held in IES, CASS. Representatives of CASS, National People's Congress, the International Department of Central Committee of CPC, the National Development and Reform Commission, Ministry of Commerce, Ministry of Foreign Affairs, Ministry of Education, universities and think tanks attended the conference. The Statute of 16+1 Think Tanks Network Council, members of the Academic Committee and the first council were approved. In January 2016, 16+1 Think Tanks Network, together with EURISC Foundation of Romania and the Institute of International Politics and Economics, Serbia, conducted a joint research on the EU Strategy for Danube Region. In February 2016, 16+1 Think Tanks Network and the Baltic Management Institute officially launched the joint research on the EU Strategy for Baltic Region and the "Belt and Road Initiative”. In March 2016, the delegation of 16+1 Think Tanks Network visited the Faculty of Economics, University of Ljubljana and Institute for Development and International Relations, Croatia for academic exchanges. On March 28th, 2016, during Chinese President Xi Jinping's visit to Czech Republic, the delegation of 16+1 Think Tanks Network and Institute of International Relations, Prague jointly hosted an international seminar themed on China-Czech relations under the "Belt and Road Initiative”. Wang Weiguang, the President of CASS and 16+1 Think Tanks Network, and Huang Ping, the Secretary-General of 16+1 Think Tanks Network and the Director General of the Institute of European Studies, CASS, attended the seminar and delivered keynote speeches. At the invitation of the Czech Academy of Sciences, from March 28th to March 30th 2016, Wang Weiguang, the President of CASS and 16+1 Think Tanks Network, led a delegation to Prague, Czech Republic, during which he exchanged views extensively on the China-CEEC Cooperation with the representatives from scientific research institutions and think tanks of Czech Republic, and signed MOUs of cooperation with the delegates from the Czech Academy of Sciences.

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An Introduction to the China-CEEC Think Tanks Network

On April 22nd 2016, Slovenian Ambassador to China Janez Premože was invited by 16+1 Think Tanks Network to give a keynote speech on China-Slovenia relation at the Institute of European Studies, CASS. On April 25th, 2016, 16+1 Think Tanks Network hosted a lecture given by H.E. Mr. Witold Waszczykowski, Minister of Foreign Affairs of the Republic of Poland at the Chinese Academy of Social Sciences. On May 3rd, 2016, 16+1 Think Tanks Network hosted an international seminar themed on the "Belt and Road Initiative” and the China-CEEC Cooperation. At the invitation of the Institute of International Politics and Economics (IIPE), Belgrade and the Polish Institute of International Affairs (PISM), from June 16 to June 22nd 2016, the delegation of 16+1 Think Tanks Network visited Serbia and Poland respectively for academic exchanges. On June 17th 2016, during Chinese President Xi Jinping's visit to Serbia, 16+1 Think Tanks Network and the Institute of International Politics and Economics, Belgrade jointly hosted an international seminar themed on the Danube River and the New Silk Road in Belgrade, Serbia. On June 20th, 2016, during Chinese President Xi Jinping's visit to Poland, 16+1 Think Tanks Network and Polish Institute of International Affairs (P ISM) jointly hosted Poland-China Foreign Policy Forum: Progress, Potential and Way Forward in Warsaw, Poland. From July 18th to July 22nd 2016, 16+1 Think Tanks Network hosted international seminars themed on China-CEEC Cooperation under the International Production Capacity Cooperation and the "Belt and Road Initiative”. On August 25th, 2016, 16+1 Think Tanks Network hosted a lecture given by H.E. Ditmir Bushati, Minister of Foreign Affairs, Albania at the Chinese Academy of Social Sciences. From September 21st to September 24th, 2016, Wang Weiguang, the President of CASS and 16+1 Think Tanks Network, led a delegation to Croatia and Hungary, during which he signed MOUs of cooperation with the delegates from the Croatian Academy of Sciences and Arts. From September 21st to September 25th, 2016, the delegation of 16+1 Think Tanks Network and the Institute of European Studies, CASS visited Bucharest, Romania to attend the 1st „Romania-China Academic Round Table”.

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On September 23rd, 2016, 16+1 Think Tanks Network signed MOUs of cooperation with the New Silk Road Institute Prague. From October 5th to October 7th, 2016, Liu Zuokui, the Director of the Secretariat of 16+1 Think Tanks Network and the Director of the Division of Central and Eastern European Studies, IES, CASS, visited Romania to attend the Bucharest Forum.

rum of China and Central and Eastern European Countries: Enhanced Connectivity for Common Advancement in Riga, Latvia. Wang Weiguang, the President of CASS and 16+1 Think Tanks Network, and Huang Ping, the Secretary-General of 16+1 Think Tanks Network and the Director General of the Institute of European Studies, CASS, attended the forum and delivered keynote speeches.

On November 4th, 2016, during the 5th Meeting of Heads of Government of China and CEECs held in Riga, Latvia, 16+1 Think Tanks Network and the Institute of European Studies, CASS, together with Ministry of Foreign Affairs of the Republic of Latvia and the Latvian Institute of International Affairs jointly hosted International Forum of China and Central and Eastern European Countries: Enhanced Connectivity for Common Advancement in Riga, Latvia. Wang Weiguang, the President of CASS and 16+1 Think Tanks Network, and Huang Ping, the Secretary-General of 16+1 Think Tanks Network and the Director General of the Institute of European Studies, CASS, attended the forum and delivered keynote speeches.

On December 15th, 2016, Chinese Academy of Social Sciences and the Secretariat for Cooperation between China and CEEC jointly hosted the Symposium of Think Tanks of China and CEEC and the Closing Ceremony of China-CEEC People-to-People Exchange Year. Liu Haixing, the Assistant Foreign Minister of China and Cai Fang, the Vice-President of CASS and the Vice-President of 16+1 Think Tanks Network attended the closing ceremony and delivered keynote speeches. The Institute of European Studies, CASS and 16+1 Think Tanks Network organized the event together. More than 250 representatives from CEE embassies, central government departments including Ministry of Foreign Affairs of China, National Development and Reform Commission, Ministry of Commerce of China and the International Department, Central Committee of CPC, local governments and relevant think tanks or academic institutions such as Tsinghua University, Peking University, Renmin University of China, Beijing Foreign Studies University, etc. attended the symposium.

From September 14th to 15th, the "How 'Belt and Roaď initiative influence '16+1 Cooperation' International Symposium was held successfully in Warsaw, Poland, which was co-sponsored by 16+1 Think Tanks Network and Institute of International Affairs of Poland. The symposium was the biggest scale conference since ”16+l Cooperation ”has been promoted, which was also the biggest scale conference was cooperated by Chinese and Polish think tanks. What is more, the Chinese Ambassador in Poland, Xuejian, and the head of 16+1 Think Tanks Network, Huangping, the Vice State Secretary of Poland, Marek Matelovskiy gave their wonderful speeches in this symposium.

On April 24th, the ”Facing the future challenge with hand in hand” symposium of China and Central and Eastern European Countries was held in Budapest. There were nearly 60 scholars and researchers been in the conference had a heated discussion on facing common challenges of China-CEECs cooperation in the long term and how to deal with those challenges.

From September 18th to 19th, 2017, the "Black Sea and 'Belt and Roaď initiative” International Symposium was held successfully in Sofia, Bulgaria, which was cosponsored by 16+1 Think Tanks Network and Institute of Bulgaria Diplomatic Institute. What was more, the symposium was supported by The Bulgarian Ministry of Foreign Affairs.

From June 25th to July 1st, 16+1 Think Tanks Network accepted a commission from Chinese Ministry of Foreign Affairs, has held a training course for scholars from CEECs successfully. There were 16 representatives from the CEECs' think tanks. And 16+1 Think Tanks Network introduced "16+1 cooperation”, the Belt and Road initiative and the situation of China present economic development. From July 12th to 13th ,2017, ”The New Silk Road: Achievement and Challenge” International Symposium was held successfully in Belgrade, Serbia, which

On November 20th ,2017, the "the Achievement of '16+1 Cooperation' in the Past Five Years” international symposium was held in Budapest successfully, which was co-sponsored by the Ministry of International Affairs and Foreign Trade of Hungary, Chinese Academy of Social Sciences and organized by 16+1 Think Tanks Network, Institute of European studies (CASS), and Institute of International Affairs and Foreign Trade of Hungary. Nearly 100 representatives from think tanks, media, official representatives between China and CEECs attended the conference.

On December 15th, 2016, Chinese Academy of Social Sciences and the Secretariat for Cooperation between China and CEEC jointly hosted the Symposium of Think Tanks of China and CEEC and the Closing Ceremony of China-CEEC People-to-People Exchange Year. Liu Haixing, the Assistant Foreign Minister of China and Cai Fang, the Vice-President of CASS and the Executive Vice-President of 16+1 Think Tanks Network attended the closing ceremony and delivered keynote speeches. The Institute of European Studies, CASS and 16+1 Think Tanks Network organized the event together. More than 250 representatives from CEE embassies, central government departments including Ministry of Foreign Affairs of China, National Development and Reform Commission, Ministry of Commerce of China and the International Department, Central Committee of CPC, local governments and relevant think tanks or academic institutions such as Tsinghua University, Peking University, Renmin University of China, Beijing Foreign Studies University, etc. attended the symposium. On November 4th, 2016, during the 5th Meeting of Heads of Government of China and CEECs held in Riga, Latvia, 16+1 Think Tanks Network and the Institute of European Studies, CASS, together with Ministry of Foreign Affairs of the Republic of Latvia and the Latvian Institute of International Affairs jointly hosted International Fo-

was held by 16+1 Think Tanks Network and Institute of International Politics and Economy in Serbia. There were 40 expert from IO countries attend the conference and 30 representatives from media, school, NGO of Serbia. From August 3rd to 4th, 2017, "16+1 E-Commerce Cooperation under '16+1'Initiative” International Conference was held successfully in Chengdu, China, which was co-sponsored by 16+1 Think Tanks Network and China International Electronic Commerce Center. The embassy of Estonia, Hungary, Latvia, Albania, Macedonia, Serbia, Poland, Czech, Romania, Lithuania etc, and famous e-commerce platform like Alibaba, Jingdong, Amazon(China), DHgate.com, all sent their representatives to attend the meeting.

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THE FUTURE IN BUDAPEST

Author: Tamás Baranyi

What do cancer research and Ways have in common? What do the movement of the US Army and urban public utilities have to do with each other? Can we build such a smart device that can be our boss? What can robots do for people’s health? What does being innovative actually mean in today’s overwhelming innovation industry? Network research, big data, artificial intelligence, smart systems and the philosophy of innovation are featured at the think.BDPST 2017 Conference!

It was the second time on 29 th -31 st March, 2017 that experts of innovative sciences and future-focussed global thinkers had gathered in our capital at the think. BDSPT Conference. During the event organised by the Antall József Knowledge Centre and sponsored by the MVM Hungarian Electricity Ltd. and the National Research, Development and Innovation Office, for two days Budapest hosted a high-level international exchange of ideas on the technological and social challenges of the future. The conferences centred around three main topics: education and the labour market, healthcare, and the philosophical depths of innovation. THE FUTURE OF EDUCATION AND THE LABOUR MARKET Are robots coming and taking our jobs away? Is that a serious threat? The guests of the education panel focused on this topic. Dr. Zoltán Cséfalvay, Hungary’s Permanent Representative to the OECD, referred to an OECD report, according to which certain tasks are expected to be automated in 9 per cent of the currently existing jobs. For this reason, it is essential to discuss the skills and pre-studies that are indispensable to meet changed requirements. The Representative quoted software developer Tom Preston-Werner, who said there would only be two types of jobs in the future: “where you tell a machine what to do, programming a computer, or a machine is going to tell you what to do.” Jari Kaivo-oja expects 30-50 per cent of

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jobs to be eliminated, and big learning challenges to emerge. Lifelong learning models and constant education are needed. Full-time jobs and career models may also disappear altogether, which may make separating work from personal life more difficult. First it might sound good that one can stay more at home, and checks in with his boss holographically – but one must also remember that the boss also can check in holographically, which is a not so pleasing scenario. [In the meantime, young entrepreneurs, start-up firms, dynamic teams and new inventions introduced themselves to the audience in the start-up corner of think.BDPST. Even though no holographic bosses were present, one could meet the Hungarian Logiscool team. They introduced the main point of their enterprise here as well: they teach children at a very young age to “code” so that constructing more difficult algorithms should be taken for granted by the youngest generation.] Steffen Roth thinks there is no need to run and transform the labour market in panic. He mentioned the so-called streetlight effect as a serious risk factor: seeking answers to the big questions of the future, we might make wrong assumptions and project these onto the future. Staying on the streetlight effect: we want to see the small spot we shed light on, the rest is left in darkness. In spite of that, the tendency that jobs requiring high precision and low creativity will be increasingly automated

seems clear. According to the World Economic Forum, the most important professional skills of the future include complex problem-solving, critical thinking, creativity, people management and coordinating with others – that is, exactly the things of which a machine is currently incapable and might never be capable.

is the digitalisation of clinical workflows, and the third one is the digitalisation of medical knowledge, which is currently ongoing, in the fields of, for example, anatomy, physiology, pharmacology and pharmacogenomics. During the panel, serious discussion sessions on surgery and cancer research were taking place in the grand hall, and also the Tapia AI robot was introduced in the start-up corner.

INNOVATIVE HEALTHCARE The development of healthcare has always been influenced by technological advancement; the health industry is also the engine of and a market outlet for scientific changes. The second day of this year’s think.BDPST Conference was dedicated to healthcare and the impact of innovative technologies on people’s health. The experienced surgeon, Stephen Mechtler presented, both as company and a technology, Da Vinci Robotic Surgical System, which is used also by him, in detail. The company is worth of US$4.8 billion, and has 3,919 installed units worldwide, most of them can be found in the USA. The technology is used, for example, in urology and gynaecology. Technically, Da Vinci consists of two parts: a surgeon's console and a robot. The console provides HD 3D 10-times magnified images and is very easy to use. Mechtler also presented a video to demonstrate how the technology works during surgery, and listed its most important benefits: less blood loss, lower probability of infections and complications, less pain and shorter hospital stay. The technology can be applied in the cosmetic industry as well; its only disadvantage is that it is very expensive. It is not in use in Hungary yet, but Romania and Poland already have Da Vinci. The basic idea behind iKnife was also discussed: this surgical device provides information on the type of the tissue as it contacts it during a surgical intervention, based on molecular data. It is the surgeon who cuts, but the device assesses what to cut.

This small Japanese creature, being competitive among robots with its low price and cute design, is able to do several bigger and many small, spectacular things: it recognises the age, sex, current mood of its “conversation partner”, and answers various questions. More importantly, Tapia is intended to be used in elderly-care: it facilitates communication, reminds of taking medication, later it might even make a diagnosis. Tapia features all elements of Japanese cuteness, and is uniquely cheap compared to its mates: we can have one for HUF250,000. How to be innovative? The two most important lectures of think.BDPST were two keynote speeches delivered on Thursday and Friday by George Friedman, founder of Stratfor and current managing director of Geopolitical Futures, and rabbi Daniel Hershkowitz, Professor of Mathematics and Israel’s former Minister of Science and Technology. They both spoke about the philosophical dimensions of innovation. Innovation is regarded as a geopolitical remedy by many, since innovation may enable resource-poor countries investing in education and technology to compete with more resource-rich regions. The basic idea is simple: knowledge is everywhere, but oil or the bank system is not. But how realistic is this idea?

Adlassnig said that clinical medicine requires digitalisation. i.e. an increasing involvement of robotics, is required on three levels in clinical medicine: the first phase is the level of digitalising patients’ medical data, big data-type collection of data, dynamic databases and medical applications developed based on them. The second stage

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George Friedman warned to be cautious. He thinks that a distinction must be made between science, technology and innovation. Innovation is a simple response to an urgent need. Technology, using the innovative outcomes of science, however, has life-cycles. Roughly 50 years are required for a new technology to become mature, and then it starts to decline. It does not mean that it is not important during its decline, but is no longer an innovative field. The steam engine, which became wide-spread around 1800, reached maturity around 1850, and then started to decline, but is still important. Similarly, the internal combustion engine, which has been in a decline phase since 1965, is still very important, as our roads are packed with vehicles; but it is not an innovative field any longer, we just want to make vehicles cheaper, safer and more comfortable. Friedman believes now we are living in the cycle of microchip technology, which became widespread around 1970, and is about to peak nowadays. Microchip, enabling the internet and social media, is going to reach its peak soon: it will remain important, but cease to be an innovative field. The pattern of human history suggests that something new must be invented, which cannot be seen yet.

The Antall József Knowledge Centre seeks to make think.BDPST as a brand mean the largest conference of the region focussing on technological innovation and future challenges. This year’s conference was centred around healthcare, education and the labour market; the central topic of the 2018 event will be the transport. The transport of the future will change cities in which we live – but how will it do so? 186

Where should we look for the urgent need that we can respond to? Friedman believes it is the military, because warfare has always been the source of innovation. Friedman thinks the protection of the

human body (armature) and energy storage (ultralight batteries) can be the fields of excellence. Professor Hershkowitz saw the origins of innovations similarly when he was speaking about “the blade of the guillotine sharpens the human mind”, that is, we come up with a new idea if there is a lot at stake; the simple phrase “be innovative” is not enough. Hershkowitz thinks innovation can be achieved by thinking outside the box. But how can you think outside a prevalent paradigm, the “box” – if you are the “box”? How can you think without including your own personality, experience, problem-solving? Professor Hershkowitz believes we can tackle the problem by thinking together with others: if we involve their experience, personality, problemsolving by involving them, too. That is exactly why the Professor thinks that research teams will be the great innovation workshops of the future. He is a strong advocate of including students in these teams, not just scientists already researching a topic for decades. Students must be let ask questions, even in the highest circles: 98 per cent of their questions will be banal, but there will be 2 per cent that will challenge the entire research community. As a Jewish saying quoted by Professor Hershkowitz goes, “I have learnt a lot from my teachers, but I have learnt more from my students.”

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BOOK RECOMMENDATIONS REVIEWS

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BOOK RECOMMENDATIONS

HOW CULTURE MADE THE HUMAN MIND BY KEVIN N. LALAND Humans possess an extraordinary capacity for cultural production, from the arts and language to science and technology. The human mind has undergone to enormous development while evolving from its roots in animal behaviour; however, we have very little information about the details of the process. Kevin M. Laland’s book presents a new theory of human cognitive evolution, revealing how culture is not just the magnificent end product of an evolutionary process – it is also the key driving force behind that process. The book is based on extensive research, outlining the main stages of human evolution from prehistoric times up to the 21 st century. In his book, Laland, Darwin's intellectual descendant, tells the story of his painstaking fieldwork, the key experiments and the stunning scientific breakthroughs that led to this new understanding of how culture transformed human evolution and the evolution of the human mind.

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SOCIONOMIC CAUSALITY IN POLITICS: HOW SOCIAL MOOD INFLUENCES EVERYTHING FROM ELECTIONS TO GEOPOLITICS BY ROBERT R. PRECHTER In their latest book, the author, who is the President of the Socionomics Institute, and fellow contributors unveil the relations between trends and processes behind unexpected social and economic changes. Applying the theory of socionomic causality in politics helps to understand the occurrence of such significant events as why certain candidates win elections, why nations go to war and what is in the background of social explosions. The book highlights the factors that confound even the most brilliant political analysts, scientists, and how you can understand and sometimes even anticipate political changes. For those who wish to better understand the sophisticated system of global politics, socionomic studies, belonging to the field of behavioural studies, may provide an adequate tool. The book puts together the contributions of 10 authors in 80 chapters in a readily comprehensible manner.

THAILAND: SHIFTING GROUND BETWEEN THE US AND A RISING CHINA BY BENJAMIN ZAWACKI

KINGS AND PRESIDENTS: SAUDI ARABIA AND THE UNITED STATES SINCE FDR BY BRUCE RIEDEL

THE STATE OF THE AMERICAN EMPIRE: HOW THE USA SHAPES THE WORLD BY STEPHEN BURMAN

THE CREATIVE SPARK: HOW IMAGINATION MADE HUMANS EXCEPTIONAL BY AGUSTIN FUENTES

Since World War II, Thailand positioned itself as a key strategic ally of the United States, serving as a bulwark against communism; in return, the United States has provided the country’s consecutive despotic regimes with vast military and economic aid. However, by the 21 st cen-

The US-Saudi relationship dates back to 1943, when President Franklin Delano Roosevelt met with two future Saudi monarchs. Subsequent U.S. presidents and kings have had direct relationships, setting the tone for a special partnership between an Islamic absolute monarchy and the world's leading democracy. Drawing on his rich personal experiences, the author of the book gives an overview of this relationship, which has rarely been smooth. Israel has caused friction since the early days, and the war on terrorism also has had controversial consequences primarily in economic cooperation. Bruce Riedel, working for the CIA, the White House, and Brookings during his career, used numerous declassified documents, interviews and memoirs for his book to give an accurate account of the complex partnership of the two countries.

The global military, economic and cultural presence of the American empire is a unique phenomenon from several respects. By now, however, maintaining dominance is posing a more and more serious challenge to Washington as reconciling national interests and global responsibility is a difficult task. In his atlas, Stephen Burman gives an account of the main aspects of the American hegemony treating topics such as military might, security, energy policy, trade, capital, population, soft power and culture in different chapters. Richly illustrated by photographs, graphs and maps and written with scientific accuracy on the basis of the most up-to-date data, the book is a report on the state of the “empire”. A must-read for all readers interested in the fate of the American world power.

The book provides a bold new synthesis of palaeontology, archaeology, genetics and anthropology, answering an age-old question: What made humans so exceptional among all the species on Earth? The author’s answer is rather simple: creativity. Creativity, that is a harmonious relationship between the ability of imagination and collaboration, has been present in the history of mankind from the beginnings. Although the manner of the collaborations varies widely, but successful collaboration is inseparable from imagination. We still have our ancient ancestors' creativity, and this is what separated us out from all other creatures during evolution. As Agustin Fuentes concludes, to make something new you need to understand the limits of your imagination and the nature of your collaboration with others.

tury Thailand’s foreign relations have seen a striking reversal, as China, once a sworn enemy, now is treated as a valued ally by the Thai military and political junta. Through a compelling account of Thailand’s modern history, Benjamin Zawacki explains how the country’s foreign policy has transformed, offers insight into its relations to the USA and China, and its new role in the changing world order. As the Sino-American rivalry escalates, the region will become an increasingly important theatre in global affairs, therefore understanding Thailand’s pivot to China has relevance not only for the future of Southeast Asia, but the wider world, the author concludes.

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CEO, CHINA. THE RISE OF XI JINPING BY KERRY BROWN Author: Alexandra Zoltai

Recently China has become the powerhouse of the world economy, its incredible boom overseen by the secretive and all-powerful Communist Party. But since the election of Xi Jinping as General Secretary, life of the Chinese elite has changed. Under the guise of a corruption crackdown, which has seen his rivals imprisoned, Xi Jinping has been quietly building one of the most powerful leaderships modern China has ever seen. The noted China expert Kerry Brown reveals the hidden story of the rise of Xi Jinping, who is often dubbed the 'Chinese Godfather'. Xi Jinping's China is powerful, aggressive and single-minded and this book provides valuable information about that, primarily for the Western world. INTRODUCTION In the introduction, the author makes clear that he finished his book in 2016, therefore he covered the events and the context known hitherto, and this is his reference point for future visions as well; furthermore, he also reveals the difficulties of writing about the Chinese political system and life. At the beginning of the book, he compiled a list of key people in Chinese politics, adding a one-line description to each; and made a timeline of the milestones of Xi Jinping’s life. The author commences his book with a recollection of his first meeting with Xi Jinping, then Party secretary of Shanghai, and provides an insight into the life and structure of Chinse leadership, placing the main emphasis on Mao Zedong. THE HUNT FOR POWER IN MODERN CHINA Where is power located in China? The obvious answer to that question is that in the Communist Party of China (CCP), which locates its legitimacy in three areas: being part of the United Front to win victory over the Japanese in World War II, its having unified the country after the Civil War and its having started the ‘reform and opening-up’ process in 1978. The CCP is currently led by Xi Jinping; the author makes clear that the Party cannot be understood without the General Secretary, and vice-versa, the General

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Secretary cannot be understood without the Party. Its power is his power, and his power is derived from it, which has been an issue little understood by many outside observers, the author remarks. The recent times of the Party organisation has been the history of the People’s Republic of China, its vision and ideals have also been the visions and ideals of the nation, the CCP is therefore able to locate much of its power in controlling the destiny of the country. Consequently, this gives the Party the right to figure in all areas of broad decision-making, with the premise that what is good for it is good for the country and what is good for the country is good for it.

forces, is the instrument of physical enforcement of the Party’s will, as well as a power demonstrator of the People’s Liberation Army of China, the military wing of the CCP.

The author gives a fair summary of the Party’s structure and the way that it works, although he is not going into full detail. He often uses metaphors; he compares, for example, the structure of the Chinese Communist Party to a Catholic church, where party members are like the religious believers, the Central Committee is like the convocation of cardinals, the topmost Party leaders are like the Secretariat of the Vatican, and the general secretary, armed with doctrinal infallibility, like the Pope, is a rule-giver, spiritual nurturer, and the voice of doctrinal purity and correctness. The author’s starting point is that Western people may have a better understanding of the complex structure of the CCP through this image.

the capital of the CCP and now those families draw the richest dividends on the Party’s wealth. These clans and families constitute the most valuable part of the Party, and may well radically change, ironically under a man (Xi Jinping), himself someone coming from this background.

After having introduced the composition and operations of the Party organisation, he is moving on to another substantial topic, namely what holds together the power of the CCP and ensures its influence. Following this line of thought, he continues with another metaphor, impersonating the idea of power. He describes the institutional structure of power in modern China as the bones and veins of the physical body, and asks the question as to what is the source of the blood that runs through the body and gives it life and power. Power is not solely about ordering and doing; it is about thinking and influencing, reaching into people’s minds and souls. Through this idea, he guides the reader through the main virtues of Chinese leaders and the factors influencing them, starting from Mao’s extraordinary emotional and intellectual appeal. Further important factors include control over the media and the narratives of the propaganda, as getting the message right is considered crucial for power. One of the basic pillars of power is money, therefore it has an important place within the Party. The other important factor and source of power, the control over armed

Alongside the institutionalized and corporate forms of access to power, there is another important factor: privileged and influential clans and their interrelationships. Although China under Communism buried feudalism and landlords were brutally dislodged, in a society so vast there will always be the need for networks, whether provincial, familial or institutional. Belonging to these networks has great significance, as the blood still links the families who were investors in

Staying with the above-mentioned metaphor, “blood”, the source of power, is not just a bundle of institutional and tangible elements, but is also based on intangible sources, such as ethics and emotions. Their presence and understanding are the most crucial. One of the core elements of the Party is having moral authority, including delivering justice and fighting against oppression. Under Mao Zedong, this pillar was undermined, but under Xi Jinping it has been reclaimed, and become the equivalent of justice, anti-corruption, happy and healthy living and selfless virtues. As for emotions, the power of the CCP is located in its appeals to nationalism and to sentiments of a rejuvenated China restored to its correct honour and status as a major global player. Often, this drifts into targeted campaigns against ‘old enemies’ like the Japanese or the Vietnamese. This is inevitable because emotional appeal is one of the most important and forceful forms of intangible political power. The CCP claims it holds power because it alone has the true path, the true ideas, to deliver a great, strong powerful country. The Party vision is a crucial element of its rule, and one of the main sources of its legitimacy.. XI, THE MAN Since Xi’s coming into power in 2012, it is hard to resist the idea that there was some inevitability about his rise, and he was predestined to achieve and occupy his current position, the author reckons.

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CEO, CHINA. THE RISE OF XI JINPING BY KERRY BROWN

The author begins this chapter by describing Xi Jinping’s childhood, placing emphasis onto his parents, and more particularly, his father’s career in the Party and his prosecution. Then he moves on to Xi’s youth, which covers the years of the cultural revolution. His father’s disgrace meant that Xi was unable to join the Red Guard groups and was sent down to the countryside in 1969. For all its discomfort and bitterness, being a sent-down youth paid political dividends for Xi, as this period gave him an intimate understanding of rural life and enabled him to understand the challenges of farmers, who still made up almost half of China’s population in 2010, according to the national census undertaken that year. Later he returned to Beijing, where he commenced his

decided to continue the reforms, and the city, as well as Xi Jinping’s career, was given a second chance. In 1996, he was finally elevated to provincial-level leadership as a deputy governor. However, he missed out on election to the Central Committee of the Party at the National Congress in 1997; he was promoted to the leadership of Zhejiang province shortly after. Before taking this position, two important changes had taken place running to his favour. The first thing was that China entered the WTO in 2001; the second was the lifting of prohibitions against business people being members of the Party. As a result, the province started to develop rapidly, and Xi also supported such local enterprises as Alibaba and Geely – later both of

Since coming to power, he has been driving China towards a more nationalistic and assertively exceptionalist direction. He has been articulating scepticism about using foreign ideas without adapting them to unique Chinese circumstances.

to become a strong and powerful country, has survived. What provokes most praise and most criticism about Xi Jinping is his attempt to unbury Mao.

As described above, power in China has two sources: a material and an ideological one. In order to find out where Xi Jinping’s power is located, we must see the ways in which he could count on support and harvest political and power capital from them. Since the Party in 2007 put him on pole position to become leader, he gained the Party’s support for the next five years, partly because collective interest required so.

In order to understand the President, the author argues, it is important to have a look at his friends and enemies. The author lists several categories of his relationships, the most important ones include his intimate links, his family, his wife and his daughter. The next category consists of his political allies, close friends and bureaucratic supporters, people with whom he works from day to day, and there are

studies. Two years after Mao’s death, his father could also return to the capital, when his son was near the end of his course at the elite Qinghua University. Young Xi was linked to Chen Xi, who later became his mentor and one of his main confidants.

these companies were making a mark outside China, with Alibaba making its founder, Jack Ma the richest man in Asia by 2014. The results made several foreign companies invest in the province.

If there had been problems, there was no reason why Xi couldn’t have been side-lined, as this is a process in which there are no real cast-iron rules.

his advisors; in addition, one must not forget about his antagonists and enemies, either. Some of his relationships used to be important, but are now side-lined; and some will be important in the future.

After his studies, Xi joined the Central Military Commission, where he met a Geng Biao, a highly-respected military officer, who was later removed due to his disagreement with Deng. It made Xi Jinping look for new paths, and left Beijing in 1983, and he was not to return for the next 25 years. He started to work in Zhengding, Hebei province, as a lowest-level official, following his father’s advice to seek real experiences and start from the bottom and work his way upwards. In 1985, he arrived and started to work in Xiamen, Fujian province, where he had the good fortune to work with Xiang Nan, the master of reform, a person who was to perform the same service for Fujian as Xi’s father had for Guangdong. This period left a deep impression on Xi’s life, who faced the policy of reform and opening-up in practice first in Fujian. He met and then married his second wife, Peng Liyuan, who was a popular singer in China and more widely known than his husband in those days. Later Xi was removed from relatively developed Xiamen, and sent to one of the poorest areas of the province, Ningde. Within the Party, it is general practice to send cadres to the least developed areas so that those aspiring for leading positions within the Party should demonstrate their competence to lead the country. During this period, Xi gained first-hand experience of the weaknesses and backlashes of the reform and opening-up, and he faced rising levels of corruption here. Later he was promoted to Fuzhou, but initially, after the events in Tiananmen Square, it was not an easy time for him. Deng Xiaoping, however,

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The author devotes special attention to the conflict between the Xi and the Bo families, which started during the cultural revolution between Xi Zhongxun and Bo Yibo, and left its imprint also on the relationships of the next generation. No deeper insights are allowed into the real relationship of the two sons, Xi Jinping and Bo Xilai – only into the events taking place on the surface. In 2007, a few months before the next Party Congress, Xi Jinping’s name appeared in speculation, although he still was not a member of the Politburo. Nevertheless, his name was later referred to as a potential member of the Standing Committee. His tactics proved to be working: he remained in the background, and worked his way upwards. More importantly, on the day of the Congress, he entered the room before Li Keqiang, getting before him in rank as well, that is, he became the heir to the president’s position. Provincial leadership is immensely important for the CCP, as Chinese provinces have populations that can easily outnumber most other states in the world. Therefore, cadres can demonstrate their competence of running the country later by successfully running a province. Jiang Zemin, Hu Jintao and Xi Jinping all came from careers directing the Party in provinces. This task is a tough one, not only because of high pressure and the risk of ruining their careers, but because they are outsiders, surrounded by local people. Xi Jinping’s ultimate success was not automatic and foreseeable; it became obvious when in 2012 he first emerged to address the people as the new General Secretary of the CCP and China’s new President.

Working his way upwards from the lowest levels and doing his job well was a double gift within the Party, which Li Keqiang could not demonstrate. This is what it makes more accurate to say that it is the position that chooses a person, rather than that the person runs for the position. He could become the new General Secretary of the Party in 2012 because – from his background, his life story and administrative record – he had demonstrated his capacity to do what was expected from the job. The CCP is an institution embodying the role of a prophet or a warlord. It defends itself and has people that articulate its collective beliefs and passions. In this respect, Deng Xiaoping, Jiang Zemin, Hu Jintao or Xi cannot be seen as “emperors” of the Party, because the emperor is the Party itself, employing transient leaders (general secretaries) to express its immortality, who are the spokespeople of its infallible messages. The CCP has fulfilled a historic role to represent something for which Chinese people sacrificed themselves in the past, something that always represented the good of the country, and in which people could put their trust and faith. The Party is ‘the first under heaven’ and for this reason has to be built up, defended and strengthened. Xi Jinping returned to this idea when he came into power in 2012. In his comments to the press, he explicitly stated that the Party had sometimes lost touch with the people, which must be prevented because for him the Party’s interest represented the people’s will, so there should be no gap or space between the CCP and society. After Mao’s death, his idea about the real ‘China Dream’, expressing aspirations for China

XI’S FRIENDS AND ENEMIES

The author dwells long upon the life and career of Xi Jinping’s wife, Peng Liyuan, and her relationship with her husband. He regards her as an important element of Chinese politics, not only because she is an eminent representative of Chinese soft power but because Chinese politics needs feminisation. The author thinks this is one of Xi Jinping’s most complicated relationships but also the most important one. Then the author describes the most important people of the above-mentioned categories who have had an important role to play in Xi’s life. In order to understand xi Jinping, however, we must see who his opponents are. On the surface, two main enemies are usually named: Liu Xiaobo and the President of the United States. However, the most “deadly” opponents of the Chinese President sit next to him in party leadership, as they represent an immediate threat. THE POLITICAL PROGRAMME OF XI JINPING In order to understand Xi Jinping’s political mission, it is important to place and interpret it in the context of the policies and paths pursued by former leaders. As Chinese leaders do not have to be afraid of being replaced at the next elections, they can inherit what previous leaderships have done, and then mould it according to their assessment. However, they must remain consistent with the Party and the path already taken. Reform as the golden word. Xi Jinping’s most important task is to continue reform in China, as the reform era initiated by Deng Xiaoping has closed. The issue is

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now to launch a new era, that is, Chinese reform 2.0. Thinkers from the Central Party School had pointed out that reform is a wholesome, good word, something everyone likes. It appeals to people’s optimism, to their sense that the world will get better. The CCP had become the world’s greatest wealthcreation machine, more formidable than Apple and faster than the United States, the United Kingdom or Germany. However, Party strategists know very well that they need to be one step ahead of events. This is one of Party’s key functions: to map out possible scenarios and find solutions. At this point, the author refers to Mao Zedong again, and compares him with the

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does not want to be only the leader of physical China but the president of virtual China as well. 19. Appropriate handling and prevention of catastrophes: it is the government’s task to take responsibility for and coordinate security issues, safeguarding the stability and security of the state. as a result, Xi Jingping adopted the well-established institution of the UN Security Council by setting up the National Security Commission in 2013. 10. Importance of environmental protection: The Party is under great pressure to find balance between China’s growth and the reduction of environmental pollution. 11. Harmony and cooperation between the Party

• Africa and Latin America represent the fourth rank, with weak geopolitical links compared to the countries above but with strong economic links, especially in terms of energy and resources, which is likely to be even stronger in coming years. The Middle East, with moderate geopolitical and economic links with China and weak cohesion, also belongs here.

and the people are indispensable for the efficient management of all these areas.

use with each other. For the Chinese, the USA is the big brother they are seeking approval from. For the Americans, China is either an alien political system trying to take away their dominance. Whatever the United states is, the EU is not. The USA is a major power, has political unity and a policy on China; the EU’s power is weak, has not much political unity, and no real policy on China, either. But that does not mean that it is negligible for Beijing, as the EU is the biggest provider of good-quality technology and a massive export market.

current President of China, with Xi Jinping being the winner, going one better than Mao, whose 1957 proclamation contained 10 key points, while the current President has come up with 11 core areas.

HOW DOES XI JINPING SEE THE OUTSIDE WORLD?

11. The market: The Third Plenum in 2013 saw an ideological innovation: the market is not just preferential for growth, but essential. At the heart of this was a new vision of the relationship between government and the economy, which means, as Xi Jinping put it, where the market fails, the government must take responsibility. 12. The issue of state-owned enterprises: this is a major challenge that China is facing now, Xi Jinping thinks. State-owned enterprises must be smashed, as they are based on selfish interests, motivating them only for their own profit. Therefore, the Party’s main task is to develop a mixedownership economy. 13. Tax the rich. 14. The rise of urban China: Xi Jinping’s main aim is to bring modernization into rural China. 15. Democracy with Chinese characteristics: most people think that the United States has a great system for itself; it cannot be implemented in China, not only because of the monopoly in political power of the CCP, but because of the dysfunctionality of the system. 16. Reforming the judiciary: Xi regards it one of his main tasks to restore trust between the people and the government. He sees Chinese judiciary is full of defects and inefficient. 17. Ending corruption: The President see it the main barrier to building greater trust between the CCP and its members or the Party and the people. 18. Cyber warfare: Xi Jinping is probably the first leader to have a clear, serious digital strategy. He

In the context of policy priorities, domestic reforms take the lead, and foreign affairs take a peripheral role. China has traditionally defined its diplomatic interests as concentric circles, with China in the middle, and other countries arranged around it in order of their importance. Relations overlapping with its regional and strategic interests, such as the United States, are its top priorities; but its partners in Latin America and Africa are more peripheral because of their distance. The book distinguishes between four ranks of China’s relationships with the world: • I t is the United States of America alone in the first rank. The two countries are connected by very strong geopolitical and economic links; therefore, they have a close relationship. •T he second rank includes the EU and Russia. There is a close and strong geopolitical and economic link with the EU, particularly as a knowledge partner, but cohesion is weaker. The geopolitical relation with Russia is very strong, mainly because of a huge shared border between the two countries, but the economic link, mainly focussing on energy and resources, is weaker, with relatively strong cohesion. •T he third rank includes the ASEAN countries and the Asian region, where geopolitical and economic link is very strong, the proximity of these countries is significant, but cohesion is very weak. This rank also includes Central Asian countries, with which the geopolitical and economic link is moderate, but is planned to be strengthened through the New Silk Road; they are characterized by strong collaboration and moderate cohesion.

The author of the book describes only the US and EU relations in more detail. He characterizes the US relations as a necessary partnership between the two countries. They represent different views in all their collaborations and shared interests, and often there is rivalry and hostility behind the moderate tone they

The author mentions the concept of the New Silk Road, mainly from the perspective of Central Asian countries, but also its impact on the Middle East and Eastern Europe as well as the idea of the New Maritime Silk Road are discussed. The author expresses his scepticism towards ‘One Belt, One Road’, mainly because he believes that the implementation of such a vast project is impossible. At the end of the chapter, he speaks about China as a new global power and the power of Chinese capital every country wants a share from. He quotes Nietzsche, who declared at the end of the 19th century that God was dead; in the modern era, God has been replaced by the Chinese currency, the renminbi, the author adds.

WHAT DOES XI WANT IN THE NEXT TWO DECADES? How do current leaders perceive China’s future? What do they exactly mean by the ‘China Dream’? Everybody knows the importance of turning China into a middle-income country by 2020; but what about the world beyond 2020? These are some of the questions for which the author seeks the answer in this chapter. However, they are not easy to answer, as available sources are scarce. He thinks the Chinese political system is able to implement long-term plans as Chinese leaders are different from democracies because of their ability to work in longer timeframes. Elected political leaders need to focus on delivery of shortterm goals dependent on their electoral cycle. Chinese leaders are not the servants of electoral politics, and this allows them to aim for longer-term policy goals, such as the five-year plans. The current trends suggest what the core areas in China’s future will be: demographics, energy usage, GDP growth, productivity and the composition of the economy. The challenge of demographics does not lie with the size of the population, its composition in terms of age or gender, but with the policy frameworks devised to address the problems of an ageing population, social benefits and the healthcare system. The issue of energy and resources is also a very important one, due to China’s insatiable hunger for energy and environmental pollution. GDP growth and the shape and health of the economy are also key to China’s future, regarding inflation, wages, unemployment or the balance of trade between imports and exports. In 2035, if the current Chinese leadership sticks to its main parameters, China will remain unified, GDP growth will be strong and the CCP will remain in power, as China’s goal for 2035 is to become a modern, harmonious, creative and high-income country.

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Budapest Guidelines China-Central and Eastern Europe Investment Cooperation Fund http://china-ceefund.com/Template/ background_9.html (2017.12.13) China's Twelve Measures for Promoting Friendly Cooperation with Central and Eastern European Countries”, Cooperation between China and Central and Eastern European Countries, January 26, 2015. http:// www.china-ceec.org/eng/zdogjhz_1/t1410595.htm (2017.4.15.). Eastern Partnership, European Commission, 2017. https://ec.europa.eu/neighbourhood-enlargement/ neighbourhood/eastern-partnership_en (2017.12.11) Eszterhai Viktor: Az Egy Övezet Egy Út Németország szemszögéből, május 8, 2017. http://www.geopolitika.hu/hu/2017/05/08/az-egy-ovezet-egy-ut-nemetorszag-szemszogebol/ (2017.12.8.); Van Der Putten, Frans-Paul – Seaman, John – Huotari, Mikko – Ekman, Alice – Otero-Iglesias, Miguel: Europe and China’svNew Silk Roads. European Think-tank Network on China (ETNC), December 2016. Eszterhai, Viktor: 2. The Financial Cooperation between China and Hungary from the Central and Eastern European Perspective, Magyar Nemzeti Bank – China-CEE Institute, 2017. China-CEE Institute. (under publication) Eszterhai, Viktor: How to Synergize the “16+1 Cooperation”with the ‘Belt And Road’ Initiative Better After the “Belt And Road” Forum For International Cooperation, China Social Sciences Press, Beijing. 2017. (under publication) Eszterhai, Viktor: The Central and Eastern European countries’ attitude toward the OBOR initiative: hopes and reality, In: Chen Xin (ed.): How Hungary Perceives Belt & Road Initiative and China-CEEC Cooperation, China Social Sciences Press, Beijing, 2017. Eszterhai, Viktor: The Question of the Missing Chinese Greenfield Investment in Central and Eastern Europe: the Case of Hungary, China-CEE Institute, 2017. China-CEE Institute, Working Paper 18. 15 November, 2017. EU-China 2020 Strategic Agenda for Cooperation, European External Action Service, November 23, 2013. https://eeas.europa.eu/sites/eeas/files/20131123. pdf (2017.11.12) EU-China Comprehensive Agreement on Investment, European Parliament, 2017. http://www.europarl. europa.eu/legislative-train/theme-a-balanced-andprogressive-trade-policy-to-harness-globalisation/ file-eu-china-investment-agreement (2017.12.12) EU-China Connectivity Platform, 2017. Five-year Outcome List of Cooperation Between China and Central and Eastern European Countries, Ministry of Foreign Affairs of the People’s Republic of China, November 28, 2017. http://www.fmprc.gov.cn/ mfa_eng/zxxx_662805/t1514538.shtml (2017.12.5) Godement, François – VASSELIER, Abigaël: China at the gates: A new power audit of EU-China relations, European Council of Foreign Relations, 1 December, 2017. http://www.ecfr.eu/publications/summary/ china_eu_power_audit7242 (2017.12.8.)

Grieger, Gisela: “China, the 16+1 cooperation format and the EU”, European Parliament, March 2017. 2. http://www.europarl.europa.eu/RegData/etudes/ ATAG/2017/599313/EPRS_ ATA(2017)599313_ EN.pdf (2017.8.22). International Customs Co-operation and Mutual Administrative Assistance Agreements, European Commission, 2017. https://ec.europa.eu/taxation_customs/business/international-affairs/international-customs-cooperation-mutual-administrativeassistance-agreements_en (2017.12.11) Investment Plan for Europe: the Juncker Plan, European Commission, 2017. https://ec.europa.eu/ commission/sites/beta-political/files/investment_ plan_booklet_en.pdf (2017.12.5) “Joint Agreed Minutes of the Second Chairs' Meeting of EU” China Connectivity Platform, 1 June 2017. https://ec.europa.eu/transport/sites/transport/ files/2017-06-01-joint-agreed-minutes-secondchairs-meeting-eu-china-connectivity-platform.pdf (2017.11.12) Kratz, Agatha: The best of both worlds? CEE’s place in China-Europe economic relations, In: KRATZ, Agatha – STANZEL, Angela – PAVLICEVIC, Dragan: “China’s Investment in Influence: the Future of 16+1 Cooperation”, The European Council on Foreign Relations, China Analysis, December 2016. 8. URL: http://www.ecfr. eu/page/-/China_Analysis_Sixteen_Plus_One.pdf (Accessed: January 15, 2017). Li Keqiang Attends Third Meeting of Heads of Government of China and Central and Eastern European Countries, Cooperation between China and Central and Eastern European Countries 26 January, 2015. http://www.china-ceec.org/ eng/ldrhw_1 /2014bergld/tpx w/t141 1 36 4.htm (2017.11.12) Liu Zuokui: China-CEEC Cooperation: China’s Building of a New Type of International Relations, Croatian International Relations Review, 23(78), 19-34. 21-22. https://www.degruyter.com/view/j/cirr. 2017. 23. issue-78/cirr-2017- 0005/cirr-2017- 0005.xml (2017.12.5) Long Jing, Yidai yilu changyi zai zhongdongou diqu de jiyu he tiaozhan (“一带一路” 倡议在中东欧地区的机遇和挑战, Guoji guancha (国际观察), 3., 2016, 118-130. Magyarország célja, hogy a térség legfőbb kínai exportőre legyen, Külgazdasági és Külügyminisztérium, November 26, 2017. http://www.kormany.hu/hu/ kulgazdasagi-es-kulugyminiszterium/hirek/magyarorszag-celja-hogy-a-terseg-legfobb-kinai-exportore-legyen (2017.12.11) Strategic Framework for Customs Cooperation 2018 - 2020 between the European Union and the Government of the People's Republic of China, Council of the European Union, 22 May 2017. http://data.consilium. europa.eu/doc/document/ST-9548-2017-INIT/en/ pdf (2017.12.11) The Budapest Guidelines for Cooperation between China and Central and Eastern European Countries, Ministry of Foreign Affairs of the People’s Republic of China, November 28, 2017. (The Budapest Guidelines, 2017) http://www.fmprc.gov.cn/mfa_eng/ zxxx_662805/t1514534.shtml (2017.12.5)

The Budapest Guidelines, 2017 The Medium-Term Agenda for Cooperation between China and Central and Eastern European Countries, Cooperation between China and Central and Eastern European Countries, 24 November 2015. http://www. fmprc.gov.cn/mfa_eng/zxxx_662805/t1318038. shtml (2017.4.27). Verseck, Von Keno: Osteuropa huldigt Peking - und hofft auf Milliarden. Spiegel, November 28, 2017. http://www.spiegel.de/politik/ausland/china-osteuropa-gipfel-in-budapest-huldigung-an-pekinga-1180622.html (2017.12.5) Turcsanyi, Richard Q.: “Obor’s Older Brother: Lessons Learned from the China-CEE 16+1 Platform.” IAPS Dialogue: The Online Magazine of the Institute of Asia & Pacific Studies, July 19, 2017. https://iapsdialogue. org/2017/07/19/obors-elder-brother-lessons-learned-from-the-china-cee-161-platform/ (2017.12.5) Vision and Actions on Jointly Building Silk Road Economic Belt and 21st-Century Maritime Silk Road, Issued by the National Development and Reform Commission, Ministry of Foreign Affairs, and Ministry of Commerce of the People's Republic of China, with State Council authorization, March 2015. URL: http://en.ndrc.gov. cn/newsrelease/201503/t20150330_669367.html (2017.11.12) Zeneli, Valbona: What Has China Accomplished in Central and Eastern Europe?, The Diplomat, November 25, 2017. https://thediplomat.com/2017/11/ what-has-china-accomplished-in-central-and-eastern-europe/ (2017.12.5) Introduction of the China-CEEC Think Tanks Network Official website: http://www.16plus1-thinktank.com Book Recommendations Laland, Kevin N.: Darwin’s Unfinished Symphony: How Culture Made the Human Mind. Princeton University Press, 2017., 464. Prechte, Robert R.: The Socionomic Theory of Finance. Socionomics Instititute Press, 2016., 813. Zawacki, Benjamin: Thailand: Shifting Ground between the US and a Rising China. Zed Books, 2017., 448. Riedel, Bruce: Kings and Presidents: Saudi Arabia and the United States since FDR. Brooking Institution Press, 2017., 272. Burman, Stephen: The State of the American Empire: How the USA Shapes the World. University of California Press, 2007., 128. Fuentes, August: The Creative Spark: How Imagination Made Humans Exceptional, 2017., 352. Kerry Brown: CEO, China. The Rise of Xi Jinping Brown, Kerry: CEO, China. The Rise of Xi Jinping. London, I. B. Tauris, 2016., 288.

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LIST OF PICTURES AND FIGURES The Geographical Pivot of History 1.figure: Halford John Mackinder: The Geographical Pivot of History. Geographical Journal, Vol. 23, 1904, pp. 435) 2.figure: Saul Bernard Cohen: Geopolitics: The Geography of International Relations. Rowman & Littlefield Publishers, Inc. New York, 2009. 15. o. 3.figure: Halford John Mackinder: Democratic Ideals and Reality. A Study is the Politics of Reconstruction. Constable and Company Ltd. London,1919, 154. o. 4.figure: Halford John Mackinder: Demokratikus ideálok és a valóság. In: Geopolitikai Szöveggyűjtemény. Stratégiai és Védelmi Kutatóintézet. Budapest, 1999. 30. o. 5.figure: http://www.google.hu/imgres?imgurl=http 6.figure: Halford John Mackinder: Democratic Ideals and Reality. A Study is the Politics of Reconstruction. Constable and Company Ltd. London, 1919, 135. o. 7.figure: Halford John Mackinder: Demokratikus ideálok és a valóság. In: Csizmadia Sándor, Molnár Gusztáv, Pataki Gábor Zsolt: Geopolitikai Szöveggyűjtemény. Stratégiai és Védelmi Kutatóintézet. Budapest, 1999. 28. o. 8.figure: Saul Bernard Cohen: Geopolitics: The Geography of International Relations. Rowman & Littlefield Publishers, Inc. New York, 2009. 18. o.

7.figure: Az Egy Övezet Egy Út – az Új Selyemút útvonalai, Theo Deutinger and Kit Chow 8.figure: Geopolitikai hatalmi mátrix a közép- és kelet-európai térség vonatkozásában, Bernek Ágnes saját ábra

10.figure: Az EU NUTS2-es régióinak GDP/fő értékei (PPP – vásárlóerőparitásos értékek) 2015-ben az EU 28-ak regionális gazdasági fejlettségi átlagának százalékában, Eurostat

22.figure: A Hyperloop tervezett útvonala Lengyelországban a Varsó-Lódz-Wroclaw útvonalon és a lengyel Hyperloop vasút tervezett formaképe, A Hyper Poland honlapja: www.hyperpoland.com

11.figure: A 16+1 együttműködés európai csatlakozó országai, ecfr.eu

23.figure: Az Európai Unió Balti-régió makroregionális stratégiájának területe, Európai Unió, Európai Bizottság, a balti-tengeri régióra vonatkozó uniós stratégia: www.balticsea-region. eu/108

12.figure: Az Európai Unió TEN-T törzshálózati folyosói, Európai Unió, Európai Bizottság honlapja, http://ec.europa.eu/transport/infrastructure/ tentec/tentec-portal/site/maps_upload/ SchematicA0_EUcorridor_map.pdf

10.figure: Saul Bernard Cohen: Földrajz és politika a megosztott világban. In: Csizmadia Sándor, Molnár Gusztáv, Pataki Gábor Zsolt: Geopolitikai Szöveggyűjtemény. Stratégiai és Védelmi Kutatóintézet. Budapest, 1999. 75. o.

14.figure: Az Európai Unió makrorégiói, Az Európai Unió makroregionális stratégiáit bemutató, 2017-ben megjelent kiadványának térképe: http:// ec.europa.eu/ regional_policy/hu/information/publications/

2. figure: Az új világrend új térképi ábrázolása, www. chinaebridge.com.cn 3.figure: A kulcsövezet, valamint a belső és külső peremív, Halford J. Mackinder: „The Geographical Pivot of History”. Geographical Journal, Vol. 23.

20.figure: Az Európai Unió Alpok-régió makroregionális stratégiájának területe, Európai Unió, Európai Bizottság, az Alpok-régióra vonatkozó uniós stratégia: www.alpineregion.eu/ 21.figure: Az Északi-tengeri – Balti törzshálózati (TEN-T) folyosó, Európai Unió, Európai Bizottság: TENtec Interactive Map Viewer: http://ec.europa. eu/transport/infrastructure/tentec/tentec-portal/ map/maps.html

9.figure: Saul Bernard Cohen: Geopolitics: The Geography of International Relations. Rowman & Littlefield Publishers, Inc. New York, 2009. 17. o.

1.figure: Bernek Ágnes összeállítása, Cartographia Kft. készítette

19.figure: A Mediterrán törzshálózati (TEN-T) folyosó, Európai Unió, Európai Bizottság: TENtec Interactive Map Viewer: http://ec.europa.eu/ transport/infrastructure/tentec/tentec-portal/ map/maps.html

9.figure: A közép- és a kelet-európai országok – 2017, Bernek Ágnes saját összeállítású táblázata a World Bank World Development Indicators adatai alapján

13.figure: A közép- és kelet-európai térséget érintő öt TEN-T törzshálózati folyosó, Bernek Ágnes és a Cartographia Kft. által készített saját térkép az Európai Unió Európai Bizottságának TENtec Interactive Map Viewer honlapja alapján.

The New Europe is Born Here, in our Region

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Research, http://china-trade-research.hktdc. com/business-news/article/The-Belt-and-RoadInitiative/The-Belt-and-Road-Initiative/obor/ en/1/1X000000/1X0A36B7.htm, 2017 augusztus 14.

article-3493007/Hyperloop-coming-EuropeSuperfast-tube-people-continent-just-25minutes-2020.html

15.figure: A Rajna-Duna törzshálózati (TEN-T) folyosó, Európai Unió, Európai Bizottság: TENtec Interactive Map Viewer: http://ec.europa.eu/ transport/infrastructure/tentec/tentec-portal/ map/maps.html 16.figure: Az Európai Unió Duna-régió makroregionális stratégiájának területe, Európai Unió, Európai Bizottság, az Alpok-régióra vonatkozó uniós stratégia: www.alpineregion.eu/

5. figure: Kína „Egy övezet – Egy út” fejlesztési programjának fő útvonalai a 2017. évi márciusi helyzet szerint, Merics – Mercator Institute for Chineas Studies, https://www.merics.org/index.php/ en/china-mapping/silk-road-initiative

17. figure Magyarország áruexportjának fő irányai 2016-ban és a Magyar Nemzeti Kereskedőház irodái 2017-ben, Bernek Ágnes és a Cartographia Kft. által készített saját térkép az IMF Direction of Trade Statistics adatai és a Magyar Nemzeti Kereskedőház információi alapján

6.figure: Kína „Egy övezet – Egy út” fejlesztési programjának hat fő fejlesztési övezete, Hong Kong Trade Development Council, HKTDC

18.figure: A Hyperloop 2020-as évekre tervezett útvonala Bécs, Pozsony, Budapest és Kassa között, http://www.dailymail.co.uk/sciencetech/

24.figure: A Gazprom Északi-áramlatának I. és II. vezetéke, Gazprom hivatalos honlapja: www. gazprom.com 25.figure: A Balti-Adriai törzshálózati (TEN-T) folyosó, Európai Unió, Európai Bizottság: TENtec Interactive Map Viewer: http://ec.europa.eu/ transport/infrastructure/tentec/tentec-portal/ map/maps.html 26.figure: A Három Tenger Kezdeményezés országai és három alapelve, Slawomir Debski előadásanyaga: https://twitter.com/slawomirdebski/ status/879437089162629121 27.figure: A tervezett észak-déli irányú energetikai gázfolyosó, BIZNESALERT http://biznesalert.com/ polish-briefing-eu-grant-agreement-polandslovakia-gas-interconnection/ 28.figure: A Kelet/Kelet-Mediterrán törzshálózati (TEN-T) folyosó, Európai Unió, Európai Bizottság: TENtec Interactive Map Viewer: http://ec.europa. eu/transport/infrastructure/tentec/tentec-portal/ map/maps.html

New World Order Conference The source of pictures is the website of PAGEO Geopolitical and Strategic Factors 1.table: Mendes Dias, Carlos Manuel: Geopolítica: Teorização Clássica e Ensinamentos. Editora Prefacio, Lisboa, 2005. 222. o. 2.table: Szilágyi István: Geopolitika. PAGEO Budapest, 2017. 3.table: Szilágyi István: Geopolitika. PAGEO Budapest, 2017. 1.figure: Szilágyi István: Geopolitika. PAGEO Budapest, 2017. 2.figure: Ritkaföldfémek termelése és felhasználása (Forrás: USGS2010; Lynas Corporation Ltd, 2010; SRI Consulting; Bloomberg; Kaiser Bottom-Fisch) 3.figure: Az állami hatalom forrásainak eltolódása (Forrás: Méndez Gutiérrez del Valle, Ricardo: El nuevo mapa geopolítico del mundo. Tirant Lo Blanch, Valencia, 2011. 193. o. 4.figure: Geopolitikai szintek és struktúrák (Forrás: Cohen, Saul Bernard: Geopolitics: The Geography of International Relations. Rowman & Littlefield Publishers, Inc. New York, 2009. 41. o. Strategic Raw Materials of the Earth 1.table: A legnagyobb ritkaföldfém-bányász országok, és termelésük (2007-2015, tonna). Adatforrás: British Geopoly Survey. Budapest Guidelines 1.table: The Budapest Guidelines, 2017 A New Era for Rail Freight Transport between China and Europe 1.figure: https://gbtimes.com/chinas-belt-androad-initiative-explained 2.figure: http://hkmb.hktdc.com/en/1X0A7UXL/ hktdc-research/China-Europe-Express-Trains-OnTrack-to-Access-Belt-and-Road-Businesses 3.figure: http://www.ceec-china-logistics.org/databank/images/docs/9/72/1_China%20Railways.pdf pp.4.

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CREDITS EDITOR-IN-CHIEF Norbert Csizmadia MANAGING EDITOR Anton Bendarzsevszkij EDITORIAL BOARD Ágnes Bernek Anton Bendarjevsky László Körtvélyesi Géza Salamin Péter Szatmári György Szapáry István Szilágyi Ákos Vajas

AUTHORS Tamás Baranyi Márton Békés Ágnes Bernek Norbert Csizmadia Viktor Eszterhai László Gere Péter Klemensits György Matolcsy Viktor Orbán Nóra Anna Sándor Zsófia Szabó Éva Szentirmai István Szilágyi Alexandra Zoltai

COPY EDITOR István Czene ART EDITORS Gyula Nagy Fülöp Kovács PUBLISHED BY: Pallas Athéné Geopolitical Foundation H-1013 Budapest, Döbrentei utca 2., Hungary DATE OF PUBLICATION March 2018

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ABOUT HUG

LEGAL & PRIVACY STATEMENT

Hungarian Geopolitics (HUG) is a Pallas Athéné Geopolitical Foundation, which relies on Hungarian and foreign authors to present the most recent and the most interesting values, achievements and changes seen in the current Hungarian and global geopolitical and geostrategic scene, as well as in other related fields of science (social science, economics). HUG aims at inspiring the community interested in geopolitics, in addition to the fields of science, to create new value through extensive knowledge.

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An essential selection of

book workshops consisting of 4 titles

(SCENARIOS OF THE FUTURE) George Friedman and György Matolcsy

“expect the unexpected” “see the events of the world through the eyes of decision-makers”

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