This week we are talking about a new entry into the black market: Hungarian license plates. EURACTIV’s Network Editor Vlad Makszimov is here to help us understand why they are in high demand, the current gas prices in Hungary, and what is happening with the single market.
We also spoke with Krassen Nikolov and Spiros Sideris about how Bulgaria and other Balkan countries are threatened by a strong anti-Western wave amid Russian propaganda. We ask: what is at stake? And – what is NATO’s role in this?
Evi: Hello and welcome to Euractiv’s beyond the Byline podcast. I am Evi Kiorri
Evi: Hi Krassen, hi Spiros.
Krassen: Hello Evi.
Spiros: Hi.
Evi: It looks like thing in Bulgaria aren’t stable again. Can you tell us what is happening there Krassen? Give us the background story.
Krassen: Yeah. In this very moment, we have very intense, very hot debate in the Bulgarian parliament about the resignation of the, speaker of the parliament, Mr. Michev who is, uh, one of the prominent figures in the change continuous party. It’s the leading party in the Bulgarian coalition.
So it will be something like check if the opposition has enough majority to overthrow the government. Many, many things are on stake in Bulgaria, but from European perspective maybe the most important thing is the veto on the north Macedonia European path.
It’s important because change of the tone in the Bulgarian politics started three years ago when the GERB party, the party of the former PM Borissov, Boyko Borissov, member of the EPP. Decided to implement the veto on, Skopje’s European path.
So, from this very moment public opinion about the Macedonians started to change, uh, before that, the polls showed that, Bulgarians accept the European path of Macedonia, but when Borissov implement the veto everything’s changed.
And now the 70% of the Bulgarians is against lifting. So things started from then and, uh, it, became, uh, clear that the things are going from bad to worst. The public opinion it’s against Skopje and many Bulgarians started to think that The Europeans are trying to cheat us to leave veto and um, not to pursue our, uh, national interests. So that is the, the debate here in Bulgaria.
Evi: And the EU’s policy and in general the policy coming from the West is having the opposite effects of what the EU leaders are hoping for in countries like Bulgaria. Why is that happening and why is it important Spiros?
Spiros: Civilians are tied, uh, of the duration of the war as it affects our negative in their second mayor crisis as, as the war in Ukraine, after the coronavirus pandemic, certainly find citizens desperate and, uh, frustrated with the union’s policies. Uh, this is usually expressed by citizens turning to populist parties with far rights rhetoric emphasising the construction of EU, it’s a board by the unity of the block and for crucial decisions that the leaders of the union will have to take in the future. In addition, uh, small countries such as Bulgaria, Greece notice that, uh, they are outside the EU’s decisions and are simply following the policies of a system in Brussels that sometimes gives the feeling of living in a parallel universe.
I think they have to change, uh, the vision actually of the EU and, uh, be more, uh, participant society and leaders of the, countries
Evi: Krassen you were mentioning earlier the dissatisfaction of Bulgarians in relation with the EU and the stance it has when it comes to Northern Macedonia conflict. Is that the reason why we see the pro Russia feeling warming up again?
Krassen: The warm feeling towards Russians in Bulgaria are something that is persistent in the society. It’s not something that, starts to grow over the Ukrainian war. These feelings, uh, have been here all the time because of the history issue, the cultural, uh, issue because of the many things, including the communistic propaganda that was very fierce here for 45 years, uh, before 1989 89 when, uh, the communism fall in Bulgaria. So, the war, acted like a trigger which is radicalised these parts of the society that thinks that Russians are our brothers, we are little brothers to them and, uh, something like that.
And the problem is that voices will be, uh, presented largely, maybe in the next parliament. So this is the bigger problem for the Europeans, uh, when we talk about the Bulgarian politics after this government, when this government falls.
Spiros: I have the feeling that Bulgarian citizen are tired of the repeated elections that not, uh, bring political stability, better living conditions. The clean shift of corruption. Uh, the protest parties dominate the previous election have disappointed with their choices and the possible return to the mainstream parties is not unlikely.
Uh, this means that the deep noted relation from the Soviet period between Bulgarian, Russia will play their part with both G the socialist party. Trying to restore bilateral relations to their former status, such a development would, strengthen the pro Russian sentiment that certainly still lingers in the hearts of Bulgarian citizens especially for the older ones.
The reality as I see it is that the Soviet era has not been erased from the memory of the citizen of the former Eastern block countries in need a spark. And it can be resurfaced if this happens at the Russian block and the European union who except have many issues to result and many denials in terms of decision against Russia at the moment, the political stability Bulgaria makes Sofia, uh, vulnerable to Russian uh, ambitions in the Balkan region and the
Evi: Krassen you were talking about Putinism on your latest article on EURACTIV.COM
Do you think this applies to other countries too?
Krassen: Maybe it’s something that is valid to, uh, some other countries in on the Balkans it’s something that is valid. Uh, when. We speak about the central European countries. They have, uh, very, uh, different experience towards Russians. You know, the, the Hungarian revolution during the fifties, uh, than the Czechs against the Russians in the sixties.
We didn’t have that. Bulgarians uh, didn’t experience something like that. We were the causes why the, uh, USSR during the communist times. Many Bulgarian things that, uh, we don’t have problems with Russia, but rather with the west who is trying to betray our national interests, um, towards Macedonia.
It’s very historical issue because, uh, Macedonia is, something, uh, that is connecting to the established, um, the communistic establishment here in Bulgaria, because the communist here, uh, cut the connections between Bulgaria and Sofia Skopje during great war, the, the second world war. So it’s very ironic, but now many Bulgarian think that the Westerners are trying to cheat us to leave the veto and to betray our national leaders.
Evi: And, Spiros what is your take on this?
Spiros: Actually, Russia, attempt to influence public opinion in various in Europe, nothing new. It has been around for years, but nobody paid much attention to. They takeover of media in Balkan countries and even in Greece by companies of people close to Russia has been going on for years in north Macedonia, more than, uh, 1000 websites were created during the negotiation of Prespa agreement were propaganda against the agreement. It is no secret that Orban and Hungary and Jansa from Slovenia, both, pro Russian invested a lot of money media in the Balkan countries with right rhetoric uh, in Greece, in addition to far right websites, those with religious content were also supported in order to promote the interest of the Russian patriarchy against the ecumenic.
Uh, particularly during the period of the negotiation of the Prespa agreement in Greece efforts were made against the agreement through publications that were directed against the agreement and the bribery of church
Evi: What is NATO’s role in this? Do you think the involvement of NATO has to do anything with it?
Spiros: NATO is, uh, my opinion. He has, uh, uh, reminded active to what RAIC has done communicate really during the period and has only worked on the operational part and not to the political part. Uh, I think that NATO has acted more as a dealer of, for the supply of systems from member cans, uh, and not as a LA as.
Alliance, uh, to protect them from any dangers as, as the influence of public opinion from Russia encountering fake news, moreover NATOs desire to continue. The war has created skepticism among citizens, uh, who see that the war in Ukraine has, uh, brought many problems to their day lives. And six pub and since public opinions is, uh, primarily influenced by living status, it’s, uh, logical that there is now a negative image of NATO and the westerns that, uh, won’t war instead of peace, this can easily be used by Russian propaganda to divide the Western Alliance.
Evi: And Krassen what can we expect from the outcome of the elections and how could the outcome of the elections disturb the “anti-Russian” politics the EU is “promoting”?
Krassen: Not only Bulgarian society, but the, uh, Europeans soon will realise that Bulgaria will be no longer the stable partner on the Balkans because if we entered the spirit of the political crisis here in Bulgaria, because we, uh, are going in some kind of eternal political crisis here.
Uh, the parliament will be very fragmented. There will be no more Bulgarian leader who will, uh, speak with one voice with the EU leaders. We will be no more, no more the normal partner of the European union.
And, if we have strong Russian voices here in Sofia uh, Many European leaders will soon realised that Bulgaria can start veto some, uh, key decisions in Brussels. So this is the bigger problem. If we don’t have pro-European leaders here, it’s strong enough. It’ll be soon a big, big problem for Brussels.
Evi: Well, thank you very much, gentlemen!
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So Vlad glad we have a new entry on the black market, uh, which is a bit of a strange entry I have to say. Uh, what is this new on high demand entry and, uh, why it’s important mentioning it?
Vlad: So it’s Hungarian license plates, like actually, um, apparently you can now buy Hungarian license plates on, uh, the Slovak black market. Um, I don’t know how that works. I unfortunately don’t speak Slovak. I tried Googling it for a little while, but failed completely . But according to media reports citizens from neighbouring countries. Stealing Hungarian license plate so they can get cheaper petrol, uh, and all this is thanks to the new Hungarian government rules that were introduced on 27th of May, which essentially extended or limited the access to cheaper petrol enjoyed by, uh, motorists, thanks to the Hungarian price freeze on petrol that was introduced last fall in November and essentially this government decree, which was by the way, posted at 11:59 PM to be applied a minute later by the petrol stations. Um, so yeah I don’t envy I don’t envy those who are operating independent pet stations in hung nowadays.
But anyway, so the rules essentially said, um, only cars with Hungarian license plates are able to enjoy the frozen prices, which are set at around 1.2 euros of 480 Hungarian, Flo.
Evi: That is cheap for what we experience now.
Vlad: Exactly. So you can see why people are on the market for some Hungarian license plates now.
Um, uh, and actually there are some accessions, uh, also to motors, uh, uh, who are coming from countries. Uh, that also have regulated petrol prices, apparently. So this was Slovenia for a while. I’m not sure if those, uh, rules are still in place. Um, but also, um, Croatia and Serbia. Uh, so the idea of regulating petrol prices because of the insane inflation that we are seeing right now is not unique to Hungary alone, even though, uh, don’t quote me on this. even though we’re publicly on air, but I think Hungary was the first one to introduce. But other governments since have also considered trying to regulate prices somehow, just because obviously, you know, petrol has become very expensive, uh, due to many reasons.
Evi: And how is that compatible with the single market, uh, rules?
Vlad: That’s a great question, Evi well, it’s not, or it doesn’t seem to be, so the European commission’s, uh, internal market boss here, Thierry Breton sent a letter to the Hungarian government on June 8th, asking them to get rid of this discrimination between Hungarian, non Hungarian cars.
So the issue is not, again, [00:15:00] not so much that the petrol prices are frozen. It’s that we have one single market. And the idea of the single market is that we are all able to enjoy the free flow and goods of services. And the Hungarian government essentially straight away went publicly, uh, on Twitter and said actually, no and to be exact, uh, the international spokesperson of the Hungarian government um Zoltán Kovács said that, uh, the rise in petrol prices is caused by the war and in a war, the government has a right to protect the people. Now you might see that there’s like a little bit of a problem with messaging here. Because the price freeze was introduced in November way before the war started to control the rising prices.
So this statement that the rising patrol prices is purely caused by the war and the, uh, government has a right to protect the people. It just. Stand up to even basic scrutiny. But either way, this is the line that the government is taking. If you wanna ask my interpretation and my personal opinion, you know, they’re just buying time, uh, trying to extend this price freeze as long as possible.
Evi: And how are they, uh, financing this price difference that we see?
Vlad: Well, don’t we all want to know my guess is you remember the whole oil embargo story with Hungary trying to veto banning Russian oil from entering the EU market and how they got an exemption alongside with Slovakia. Uh, well, this is how so MOL the Hungarian fossil fuel giant, that controls about two thirds of the market if I remember correctly Also has refineries, uh, in Hungary and in Slovakia. And so they’re essentially now able to buy the Russian crude oil at a much cheaper price, and then refine it then essentially produce cheaper petrol which is gonna help to sustain this price gap.
However, their CEO, uh, about a week ago, came out and said, actually that this price crap is just not sustainable in the long run. So even ma is saying that this is not gonna work. however, all the indications of Hungarian government, um, point to the fact that they’re planning to sustain the price cap, at least for now, uh, it expires on the 1st of July so we’ll see.
Um, the government promise to come up with a new announcement somewhere mid-June. So any day now we should be hearing something, um, keep an eye out, but my guess is the price cap is not going anywhere anytime soon.
Evi: And why has Hungary, uh, cheaper fuels? What, what was the agreement with Russia?
Vlad: Orban was one of the last EU leaders to visit Moscow before the war started. Um, I remember we had a podcast on that. Yeah, we did. Didn’t we? So here we are a couple of months later. Um, and it’s true. So this is the thing Hungarian, the Hungarian government claims that it is able to buy oil as well as gas at much cheaper below market prices because they have long term contracts with Russia. However media reports have suggested that this is actually not true. Uh, those long term contracts, especially for gas are yes to fulfill a certain criteria, but actually most of the volumes or the majority of the volumes are bought at, uh, the spot market prices.
So Hungary is actually not benefiting from cheaper at least gas. Um, I’m not so sure if it’s the same case for oil, but when it comes to oil, they get the exception. Right. They’re now essentially alongside, um, any countries that are tied into the DBA pipeline, the ones who get an exemption, because if you remember the exemption is for oil transported via the DBA pipeline.
However, some countries like Germany, uh, have, uh, voluntarily said that they will not actually use this exemption
Evi: So how do you see the situation panning out at this point?
Vlad: Well I feel like I say this every single time I’m on your podcast, Evi I wish I had a crystal ball. um, you actually do, should I do um, well the reality is that because now there are two prices that need to be shown in petrol stations is quite easy to actually follow along where prices would be if the price gap was not sustained.
And at this point prices would be 70% more expensive if the price cap was UN frozen tomorrow, uh, which means it would be around two euros per liter you know is a huge price difference. That’s gonna be a shock yeah, that’s gonna buy it. so I have no idea how Orban, uh, is going to get himself out of this, realistically, probably with phase out step by step phase out, as opposed to just going from one day to another, cuz that’s just gonna be a huge shock, but sooner or later they’re gonna have to infuse it.
Uh, to be fair though, I mean, this is costing. People money and it’s costing the, as I mentioned, MOL the energy giant money it’s costing them money, but it’s not as bad as it could be because of this whole oil exemption thing that we talked about before. But it’s mostly, really killing the small independent, your moms, paps, petrol stations that who are not able to really, you know, benefit from selling refined oil AKA benzene and diesel bigger margins like Mo is they need to buy it wholesale. And even though the wholesale price of petrol is regulated as well for these petrol stations they still need to find money to finance their um, operating costs.
Literally keeping the lights on. So actually, uh, the independent petrol stations association has been very vocal on this issue, just saying you’re essentially strangling your small businesses with this decree and it needs to stop.
Evi: Thank you Vlad.
I’m Evi Kiorri and this was EURACTIV’s Beyond the byline podcast, we will be back on your feed next week, visit euractiv.com for the latest news, and if you haven’t subscribed to the podcast, you can do so on your favourite podcasting app, this episode was produced by me with the help of Vlad Maksimov, Krassen Nikolov and Spiros Sideris.
Thank you very much for listening!