* At least 300,000 seek work in western Europe
* More than half of voters support no party
* Voter registration plan under fire
* Govt wants to boost election turnout - Orban aide
* Hungary faces tough EU/IMF loan talks
By Krisztina Than and Gergely Szakacs
BUDAPEST, Sept 18 For Hungarians queuing up to
work abroad, the government's promise to achieve a "fairy tale"
of national prosperity soon is precisely that - more a fantasy
than a realistic possibility.
At least 300,000 Hungarians work in western Europe,
according to government estimates, apparently unpersuaded that
conservative Prime Minister Viktor Orban's go-it-alone and often
unpredictable policies can solve the nation's problems.
Those still in Hungary are convinced neither by Orban's
unconventional style of economics and politics, which has led to
conflict at home and abroad, nor by a weak opposition. An Ipsos
opinion poll last month showed 53 percent of voters - or 4.2
million people - had no party preference whatsoever.
Fiercely independent, Orban has upset at one time or another
the European Union, the International Monetary Fund, the
government of Armenia and - at least indirectly - NATO. With the
domestic opposition he remains constantly at loggerheads.
Miklos Zelko, a 24-year-old unemployed joiner, is one of the
many Hungarians who cannot wait to see if Orban's unorthodox
attempts to pull the country out of recession and create badly
needed jobs will work.
Zelko was among a group of young Hungarians in central
Budapest waiting recently to be interviewed for work on the
cruise ships which carry mostly wealthy, elderly western
European tourists along the continent's great rivers.
"Things don't work where I am from," said Zelko, who comes
from the western Hungarian town of Zalaegerszeg.
After failing to find a job at home, he is placing his bets
on a better future outside the country. "I'm still young and for
a few years I'd like to do this to earn money, to have some
financial security," he said before his interview for a job
washing dishes on one of the boats plying the Danube and Rhine.
Gabriella Kiss, the owner of job agency KG International,
says more and more people aged from 20 to 35 are leaving the
country of 10 million for better opportunities abroad.
"Many believe the world is out there waiting for them and
they will earn lots of money with little work, but that's not
the way things are abroad ... it's important to know that money
does not grow on trees (there either)," Kiss said.
A FAIRY TALE TO COME
Orban's government, which does not face national elections
for another 1-1/2 years, is trying to press home a message that
its policies will bear fruit soon. "The Hungarian fairy tale or
the Hungarian example will be a successful one in a year's
time," Economy Minister Gyorgy Matolcsy said earlier this year.
A message that Hungary will emerge as a strong nation from
the crisis engulfing most of Europe is hard to sell to voters.
On the face of it, Orban has avoided many of the problems
that are besetting countries across the EU. The government,
dominated by his Fidesz party, has a two-thirds parliamentary
majority following a landslide election victory two years ago
and is among the most stable in the EU.
While others struggle to control huge budget deficits,
Hungary's is due to remain this year below the EU ceiling set at
3 percent of total annual economic output.
Orban, who was also premier from 1998-2002, has achieved
this without the outright austerity measures that have toppled a
number of EU governments, and has even cut personal income tax.
He has funded this with measures such as a windfall tax on
the financial, energy, telecom and retail sectors, and an
effective re-nationalisation of private pension funds.
But Hungary's economy, largely geared to exporting to
western Europe since the fall of communism more than 20 years
ago, has slid into recession as demand falls in the euro zone.
Orban's policies such as the extra taxes have undermined
investors' confidence and he faces tough talks with the IMF and
EU this autumn about a loan deal that would help to cut the
country's high borrowing costs.
Combative as ever, he said Hungary needed the loan "to
protect itself from the sickness weighing on Europe".
"We can only achieve success if we boost our autonomy, and
make our own decisions, in other words if we boost Hungary's
room for manoeuvre," he told parliament last week, making clear
he wants a deal with international lenders on his own terms.
Any breakdown of talks could provoke a renewed slump in the
forint currency and an outflow of capital from Hungarian bonds,
risks which Orban flirted with in January when the state's
credit rating was cut to "junk" status.
CLEVER STRATEGIST OR DAREDEVIL?
In bustling Budapest, some businesses are thriving even
while the recession bites. At LEVES, a small soup bar set up by
two friends last year, long queues form each lunchtime.
But the owners say this success has little to do with
government policies. "It was not the economic situation which we
considered, our business is too small for that. Any business can
thrive that's innovative, finds its place in the market and in
which people work with relentless enthusiasm," said Zoltan
Horvath and Adam Gogge in a reply to Reuters questions.
Only time will tell if Orban's policies, dismissed by some
opponents as "voodoo economics", will achieve their aim of
creating many new jobs, reducing tax evasion and eventually
Orban, a founding member of Fidesz shortly before the fall
of communism, divides opinion not only over his economic
policies. To his allies and supporters, he is a strong leader
with a strategic vision who wants to put Hungary on new
foundations to outlast Europe's crisis.
"He does not make ad hoc decisions. He has a long-term idea
and he never makes decisions without having a strategy behind
them. You just can't always know if it will work out well in the
end," said a government source, on condition of anonymity.
Opponents see Orban as a reckless daredevil who is putting
Hungary's economy and international standing at risk.
With a firm hand, Orban has solidified the power of Fidesz -
which began as a radical student group before shifting over the
years to the right - in ways that critics say have eroded
democratic checks and balances.
The government has consistently rejected such charges, but
the passing of a media law which critics say could be used to
curb press freedom provoked a dispute with the European
Curbs on the Constitutional Court's jurisdiction have also
proved contentious, while tens of thousands of Hungarians
rallied in January to call for the removal of the man they
called the "Viktator" after the constitution had been rewritten.
A few weeks later a pro-government rally attracted 100,000
people, showing Orban remains popular among his core supporters.
Changes to the central bank law caused another row with the
EU and IMF, which said it hurt the Hungarian National Bank's
independence. Amendments resolved the standoff only after it had
held up the talks on IMF/EU financing for months.
Under Orban, Hungary has even become involved in disputes as
far away as the south Caucasus where tensions are high between
Azerbaijan and Armenia. Last month, Hungary stirred a storm when
it sent home an Azeri soldier who had murdered an Armenian
officer with an axe during NATO training in Budapest in 2004.
The soldier, Ramil Safarov, was pardoned and celebrated as a
hero when he got home. Armenia instantly broke diplomatic ties
with Hungary, and NATO Secretary General Anders Fogh Rasmussen
said he was "deeply concerned" by the pardon.
Orban has defended the decision, saying it was in line with
international law. He even said that Hungary acted knowing the
move could spark a diplomatic backlash.
"His ways may be risky and you can't always know where it
leads," said one source familiar with Orban's thinking, who
wished to remain unnamed. "But even if you do not agree with
him, within his own logical framework he has a well-grounded
answer to each question."
Despite government denials, opposition parties say it let
Safarov return to Azerbaijan in the hope of economic favours in
return from the energy producer. The Socialists, who beat Orban
in the elections of 2002 and 2006, have called on him to resign
over the decision, but they remain electorally weak.
TWEAKING THE SYSTEM
In another controversial proposal, Fidesz wants legislation
to make voters register at least 15 days before the next
election, including those who are already on the electoral list.
Critics say this would help Fidesz by keeping away many
hesitant people, who make up their minds on whether and how to
vote only at the last minute after hearing all the arguments.
The Ipsos poll put support for Fidesz at only 17 percent,
but the party has a good record on getting it supporters to turn
out, whereas the hesitant form a huge group.
Former Socialist Prime Minister Ferenc Gyurcsany, who now
leads the small Democratic Coalition, staged a week-long hunger
strike outside parliament this month to protest about the plan.
Gyurcsany, who earned infamy with a leaked speech admitting
that he had lied about the economy to defeat Orban in 2006, said
the measures' only aim was to help Fidesz get re-elected.
"Behind the concept of registration we are talking about how
the government, even though many want to see it go to hell for
destroying their lives, is trying to remain in power," he said.
Janos Lazar, Orban's chief of staff, says the change is
needed to take account of at least a million new voters who
could take part in the next election due in 2014.
The newcomers include hundreds of thousands of ethnic
Hungarians in countries such as Romania, Slovakia and Serbia,
who were made eligible for Hungarian citizenship in one of
Orban's first acts after taking power in 2010.
"Our goal is for as many people to take part in the vote as
possible and make a responsible decision," Lazar said. "There
should also be a campaign for democracy so that, apart from
mud-slinging, parties should also urge people to go to vote."
Robert Laszlo, an electoral expert at the Political Capital
think tank, said Fidesz is pushing for a solution to a problem
that does not exist. Hungary already has an up-to-date register
of domestic voters, he noted, and other changes such as easing
requirements for candidates to stand for election could make it
harder for opposition groups to beat the incumbent party, unless
they joined forces.
Laszlo said the last two weeks are critical in any election,
with many deciding at the last moment, such as in 2010 when
voters tired by years of austerity rejected the Socialists.
Gabriella Hantos is typical of the hesitant. "With
registration or without it, I think nobody knows how to vote
when the elections come," said Hantos, 57, who has been out of a
job for years.
Laszlo said it was precisely this group of disillusioned
people, whose ranks he estimates at 1.5 million, that could turn
around an election in 2014.
"Contrary to popular belief, it is not the committed voters
but the undecided who can determine an election," Laszlo said.
"Unless an economic miracle happens in the meantime, they are
unlikely to back the ruling party with a last-minute decision."