Hungary: Lean and hungry, but on the way to a better future. (1 of 2)

Hungary: Lean and hungry, but on the way to a better future. (1 of 2) - The new generation of Hungarians worry more about where to buy jeans than how to inherit the ideals of the 1956 uprising. This confounds people who thought that Hungary would emerge

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Last Updated: 31 Aug 2010

The new generation of Hungarians worry more about where to buy jeans than how to inherit the ideals of the 1956 uprising. This confounds people who thought that Hungary would emerge a better place. George Paloczi-Horvath reports.

"Can Hungary survive the winter?" was the question asked by a Budapest friend when I returned to my birthplace last October. His assumption was that with rocketing food prices the answer was a definite no.

A week later it seemed that he was right. The taxis were on strike because of fuel price rises, blockading the Danube bridges and forcing travellers to hike into town from the airport on foot. A shaky democratic Government, unused to this kind of demonstration, backtracked and struck a tenuous deal.

Hungarians make dark predictions about their future, which is none too rosy with inflation running at 30%, over $20 billion of foreign debt (the highest per capita on earth) and worsening poverty, pollution and racial tension.

This ingrained pessimism has prompted Joszef Antall, Prime Minister of the new coalition Government, to declare ruefully that he cannot risk challenging Hungarians to accept more sacrifice. A "blood, sweat and tears" speech would only depress people even more. So instead Antall promises jam tomorrow to a nation of disbelievers.

Hungary is suffering a crisis of confidence which has gone largely unreported abroad. Foreign criticism of the cautious pace of the Government's privatisation programme threatens a drain of overseas confidence. Everything may now be up for sale, but only in theory, Hungarians joke. The trade balance is in the black, but debt-servicing mops up the gain.

The managing director of an independently run but state-owned firm says that privatisation is proving difficult, given lack of capital and the Government's ignorance of companies' true value. He is trying to organise one of Hungary's first management buyouts, a sensitive task which risks alienating the stolid state shareholders.

Meanwhile visitors, accustomed to the reassuring faded opulence of Budapest's centre, cannot avoid the uncomfortable new sight of respectable pensioners begging in the streets. Foreigners easily spend the equivalent of a local weekly wage on a half-decent meal for two in one of Budapest's more acceptable restaurants.

But Hungarians will tell you that the country was always poor, and that industrialisation of this partly agrarian economy has changed little outside the major towns. Westerners rarely step beyond the confines of the smart hilly Buda districts and trendy downtown Pest across the Danube. They never see the reality, only queues outside the Adidas shop in Vaci utca, a Bond Street lookalike.

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