'Serious concerns' about Hungarian corruption mentioned in US trade report, released just days before announcement of Trump's tariffs

A US government report published at the end of March, the contents of which might provide a partial explanation for the US tariff imposed on the European Union mentions, among other things, the extremely high risk of corruption in Hungarian public procurements as justification, Válasz Online writes.

The United States government has published a 397-page report detailing the economic practices of individual countries which have justified the tariffs imposed by Donald Trump last week. According to Válasz Online, the content of the report in question can be linked to the tariffs imposed by Donald Trump a few days after its publication, as it reveals that the EU is expected to relax trade and investment rules, while in the case of China and South-East Asia, they are specifically looking to reduce imports.

Although the United States imposed tariffs on the European Union as a whole, and not on individual member states, the US government's list of complaints details a number of specific situations where European countries are imposing extra bureaucratic barriers for American (and all non-EU) companies on top of the general EU regulations. For each complaint, the document also lists specific examples of certain countries' practices, including Hungary, which is brought up several times as a country that applies even stricter regulations than the EU.

The fact that the US specifically criticizes Hungarian regulations and governmental practices is especially interesting, because according to Hungarian Minister of Foreign Affairs and Trade Péter Szijjártó, Brussels is to blame for Trump's 20 percent tariff on the EU. The minister recently said that if EU leaders had negotiated better and had made more concessions to the US, the tariffs could have been avoided. The EU has indeed tried to negotiate, and the European Commission's Trade Commissioner Maroš Šefčovič was in Washington in February and in late March as well, but the talks were ultimately unsuccessful.

The report is full of examples, ranging from the non-transparent price subsidy system for pharmaceuticals to it being extremely difficult for foreigners to become members of the bar association. Among the complaints about Hungary, the document highlights the extremely high risk of corruption in public procurements. "U.S. companies have expressed serious concerns that public procurements in Hungary are not always transparent and tend to favor either local or other non-EU countries, including China. Corruption in the public procurement system is of key concern in Hungary, despite the launching of multiple initiatives designed to address it in recent years." – the report says.

The level of corruption in Hungary being identified as one of the reasons for the US tariffs is also interesting because the Biden administration put Antal Rogán, the head of Hungarian Prime Minister Viktor Orbán's Cabinet Office on the list of sanctioned individuals in January, citing corruption. Reacting to the news at the time, the Hungarian government said the decision was "the last, petty revenge of the outgoing, failed US ambassador". We have previously explored in detail how this sanctioning could have come about, analysing the political context of the case and how long it could take before Rogán is removed from the list – provided that there is political will to do so in the US. At the government briefing on 23 January, Minister of the Prime Minister's Office Gergely Gulyás said that he believed Rogán could be removed from the list "within the foreseeable future, sometime this year".

We have sent questions about the report to the Ministry of Foreign Affairs and Trade, the Cabinet Office of the Prime Minister led by Antal Rogán and the Prime Minister's Office as well. Foreign Minister Péter Szijjártó reacted on behalf of the government to the US trade report following a meeting of EU foreign trade ministers. He said that the report was drafted under Joe Biden's presidency and that "the parts on Hungary were dictated by David Pressman", who "effectively acted as the leader of the Hungarian opposition". According to the Foreign Minister, the comments were to be submitted until October 2024, just before the November elections, and the information provided came from US embassies.

Update: The article's original title was "US report cites "serious concerns" over corruption in Hungary as one of the reasons for imposing tariffs on EU", which we later modified.