Hungary strikes protective trade deal with USA amid EU tensions

Orban reported on the conclusion of this agreement during the annual economic conference of the Hungarian Chamber of Commerce and Industry, stating that it is intended to shield Hungary from the potential effects of a trade war between the United States and the European Union.

He emphasized that Budapest and Washington are collaborating on an economic cooperation package. "Hungary's economic agreement with the USA will help us in the event of a potential trade war between the United States and the European Union," said the Hungarian Prime Minister.

The goal is to mitigate the effects of potential American tariffs on EU products. Negotiations are ongoing regarding the return to a tax agreement with the USA, which was terminated by Joe Biden's administration after Budapest resisted implementing a global minimum tax.

Prime Minister Orban noted that Hungary should maintain "economic neutrality," meaning good relations with various countries, including China and Russia. "We cannot end up like the EU, which is an isolated player in the economy," he assessed.

In late February, US President Donald Trump announced 25-percent tariffs on products from the EU, arguing that the Union 'takes advantage' of the United States. Orban cautioned that Hungary, like other EU countries, could suffer losses as a result of such trade wars.

In an interview with PAP, Peter Virovacz, the chief economist of ING Hungary Bank, assessed that good relations between Orban and Trump are not enough for Hungary to avoid the impact of a possible trade war between the USA and the EU. "Hungary will suffer losses, just like all EU member states. We do not know their extent yet, but we can be sure it will happen," warned Orban.

Hungary is working to prepare for potential economic challenges that may arise from trade tensions between the USA and the EU by strengthening cooperation with Washington and striving for economic neutrality.