Donald Trump and Viktor Orban. Photo: Zoltan Fischer/AFP
Hungary and the United States are planning to sign a new economic agreement aimed at supporting the Hungarian economy and helping to compensate for possible losses from the introduction of 25% US tariffs on goods from the European Union. This was stated by Prime Minister Viktor Orban during a speech at the annual conference of the Hungarian Chamber of Commerce and Industry, Reuters reports.
The head of the Hungarian government, who is a long-time ally of Donald Trump, stressed that the agreement would expand the existing political partnership between the two countries. According to him, if a “customs war” breaks out between the US and the EU, the economic agreement with Washington should mitigate the consequences for the Hungarian economy. Orban stressed that it is not yet known what the scale of economic losses for the EU countries will be, but they are inevitable.
US President Donald Trump has recently announced that his administration is preparing to announce a list of goods from the EU that will be subject to new tariffs. According to Trump, the European Union was created to “cheat” the United States in trade relations. He has repeatedly expressed dissatisfaction with the EU-US trade balance and called European tariffs unfair.
Official Budapest is already negotiating the renewal of the trade agreement with the United States, which was cancelled by the previous administration in Washington. According to Orban, some of the provisions of the new agreement should contribute to the country’s economic growth and compensate for possible losses caused by US duties.
Experts from the international rating agency S&P Global Ratings predict that the introduction of 25% duties on imports of cars and other goods from the EU will have a significant impact on the German car industry, which, in turn, will affect the economies of Central and Eastern Europe. Hungary, which is an important centre for the production of components for European automotive companies, may face economic difficulties if tariffs are imposed.
Orban’s government expects that the agreement with Washington will reduce or even completely eliminate the impact of a possible trade confrontation between the US and Europe on the Hungarian economy. However, there are no specific details on the terms of the new agreement, and it is unclear whether Budapest will receive sufficient compensation to cover potential losses.
The issue of trade relations between the US and the EU remains open, and the Trump administration’s upcoming decisions could have a significant impact on the economic situation in the region.
