OMRI DAILY DIGEST
No. 90, 10 May 1995

 . . . WHILE CITIZENS TRUST PRESIDENT MORE THAN PARLIAMENT. According to
an opinion poll carried out by the Slovak Statistical Office from 20-31
March, 48% of respondents said they trusted the institution of the
presidency, compared with only 39% for the government and 35% for the
parliament, Pravda reports on 10 May. Meanwhile, 41% distrusted the
president, 51% the government and 53% the parliament. Trust in the
president was higher among residents of Slovakia's largest towns and
those with more education while trust in the parliament was higher among
older people and lower among ethnic Hungarians. -- Sharon Fisher, OMRI,
Inc.

t[As of 12:00 CET]

Compiled by Steve Kettle

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A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.

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Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
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Wednesday, 10 May 1995
Volume 2, Issue 90


REGIONAL NEWS
-------------

**HUNGARY PASSES PRIVATIZATION BILL**
  Hungary's Parliament overwhelmingly approved a new
  privatization bill last night.  The legislation clearly
  defines the coalition government's privatization policy for
  the first time since last year's election.  The bill, passed
  by a vote of 208 to 86, creates a single privatization agency
  and outlines plans to sell most of the businesses still in
  state hands, including utilities and banks.  Supporters said
  the measure will jump start the stalled privatization process.
  Tamas Baur is a member of Parliament for the liberal Free
  Democrats, a member of the ruling government coalition.

  "The new government wanted to change the privatization process,
  to make it more rapid, to make it more strongly controlled, to
  make it more flexible and a little more honest.  Therefore the
  institutional system of reform had to be drafted."

  But opposition politicians said the new law isn't needed. Gyorgy
  Rasko is a member of Parliament for the conservative Hungarian
  Democratic Forum, the largest opposition party.

  "Up to 90 percent, the essence of the law, and the articles, are
  the same as are in the present law.  Then 10 percent maybe
  which is under modification.  And these new modifications and
  amendments are very dangerous."

  For example, Rasko said the bill creates a new board which must
  approve the decisions of the privatization agency.  He said
  the panel could be an instrument for political interference in
  the privatization process.  But all sides agree, Hungary must
  get privatization started soon to regain credibility with
  international investors and financial institutions.  Hungary
  is counting on $1.25 billion worth of privatization revenue
  this year. --David Fink


BUSINESS NEWS
-------------

**ING PLATE TOO FULL TO HANLE BUDAPEST BANK**
  ING Bank said it's a potential bidder for Hungary's Budapest
  Bank, but added that the bank isn't a priority because ING
  already purchased the British merchant bank Barings.  Since it
  acquired Barings on March 5 ING has reiterated that it'll
  concentrate first on that acquisition before turning its
  sights elsewhere.  That point was reinforced yesterday by
  ING's chairman who was quoted by the Hungarian press agency as
  saying ING wouldn't buy state-owned Budapest Bank shares this
  year.


**HUNGARY'S AGROBANK IN TURMOIL**
  Hungarian police have arrested Agrobank president Mihaly Kovacs
  and charged him with instigating a plan to smuggle $3.5
  million worth of gold out of the bank.  The State Banking
  Supervision (SBS) has ordered the bank's accounts frozen.  The
  SBS said it has new information that the bank's solvency is
  deteriorating and it may become insolvent.  The SBS said it'll
  hold a news conference on Agrobank.


BUSINESS FEATURE
----------------

**INVESTMENT RISK INSURANCE OFFERS SAFETY NET IN CENTRAL EUROPE**
  By Liane Thompson

  Doing business in central and eastern Europe is risky.  That's
  why so-called political risk insurance can be crucial and
  demand for it has exploded over the past few years.  Ever
  since the collapse of Vneshekonombank, the Soviet Foreign
  Trade Bank, in 1993, political risk insurance has become a
  must for anyone doing business in this region.  In the
  Vneshekonombank case, investors were left with nothing but
  piles of unguaranteed paper after the seemingly cast-iron bank
  went under.  The United States' Overseas Private Insurance
  Corps, or OPIC, estimates total requests for political risk
  coverage in the former Soviet Union alone at $40 billion.
  Only $3 to $5 billion is available.  That money covers the
  actual investment and the first one or two years' profit from
  it.  The risks being covered fall into two categories:
  contract frustration and confiscation.  Confiscation is pretty
  straight forward and usually involves a foreign government
  taking property belonging to the investor.  Bela Papp is the
  editor of  Business Central Europe magazine.  He said contract
  frustration is a bit more complicated, citing the failed
  privatization of Hungar Hotels last year as an example, where
  the Hungarian government appeared to accept an offer for the
  hotels, then asked for more money at the last minute.

  "There are two types of contract frustration depending on the
  contract.  There's one like the Hungar Hotels deal and there's
  one when you actually have a contract maybe to deliver
  pipelines, equipment or whatever the case may be and if some
  event puts a spanner in that and deliveries are delayed to the
  point where it cancels the deal, that's contract frustration,
  where political risk insurance can provide coverage."

  Papp said the premium for this type of insurance is based on a
  percent of the value of the contract.  Rates range from 0.5
  percent in the Czech Republic and Poland, to 0.6 percent for
  Hungary.  Premiums for the former Soviet Union are higher.
  Rates for Russia and Kazakhstan, for example, are 3 percent.
  That's because they're riskier for investors.  Papp said risk
  is assessed by economic think tanks and insurance companies.

  "They look at a number of factors.  Political stability,
  macroeconomic figures, inflation, unemployment, GNP growth or
  decrease.  The geostrategic situation of a country, for
  instance, Croatia would be hard for us to get political risk
  coverage because of the threat of conflict with Serbia."

  Confiscation coverage is available for Slovakia, Slovenia,
  Bulgaria and the Baltic states on a case by case basis.  For
  the most part, insurers are afraid to get involved in any
  deals in Russia, although some contract frustration coverage
  is available.  As far as the rest of the former Soviet Union
  is concerned, the only place where even limited forms of
  political risk insurance are available is the four more stable
  central Asian republics.



SURVEY
------

**HUNGARIAN STUDENTS ADAPT TO COMPETITIVE UNIVERSITY ENVIRONMENT**
  By Emmanuel Richard

  This spring, more than 85,000 applicants will struggle for
  35,000 places in Hungarian universities.  After weeks of
  study, often with private teachers, they take several written
  and oral exams.  Not even the government's plan to charge
  university students a $17 monthly tuition fee has turned
  prospective pupils away.  Like its neighbors in eastern
  Europe, Hungary has long promised a university education as a
  reward for its best and brightest.  In fact, some of the
  country's top notch universities have produced nobel prize
  winners, world renowned musicians and great scientists.  Among
  them, Ede Teller, who invented the atomic bomb.  A very
  selective system with high entry standards ensures quality
  students.  Only about 17 percent of Hungarian young people are
  admitted to universities.  Those who don't make it face
  problems with their friends and relatives, as Peter, a 23
  year-old english student explained:

  "If you fail, your friends may turn away from you, I mean those
  who succeeded and were admitted to the university and there is
  a strong pressure from your parents because they can't afford
  to provide for four or five people in the family."

  Hungarian students receive a $55 monthly stipend on average
  from the government.  That's  about a quarter of the average
  Hungarian salary.  Students are usually between the ages of 19
  and 21.  At the moment, Hungary has 200,000 students
  registered.  But according to the United Nations, these
  students make up only 1 percent of the Hungarian population,
  half the ratio in western European countries.  But Lajos
  Sipos, vice-dean of the humanities faculty at Budapest's
  Eotvos Lorand university said, at least Hungarian students all
  complete their studies.

  "We maybe have the lowest rate of students in Europe but unlike
  in France, Germany or Austria, Hungarian students all
  graduate."

  Unfortunatley, Sipos said, college graduates aren't guaranteed
  a job.

  "With the system that came into effect in the 50s, students
  were selected according to the number of engineers, doctors,
  teachers needed in the Hungarian society.  This system was
  completely changed in 1989, from then the society couldn't
  guarantee a job to all these students."

  But the courses of study haven't changed.  Many students argue
  that because of decades of communism, education in Hungary is
  too theoretical.  After all of the effort it takes to get into
  a university, Hungarian students are sometimes disappointed
  about what comes next.  Gyorgy graduated with a degree in
  French and Hungarian a year ago.  He said the material he
  studied for entrance exams wound up being a good portion of
  what he learned in college as a whole.

  "Once you are in the university you can pretty well live on
  this knowledge because it gives you a kind of a global vision
  on a subject.  It represents almost 40-50 percent of what they
  will teach you later at the university."

  But this hasn't discouraged prospective students.  The number
  of applicants is increasing 4 percent each year.  For example,
  13 students vie for every place at the university of
  psychology and arts and tension is growing.  All students
  agree, once in, they appreciate their hard-won college
  education.



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*****************************************************************
A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.

           [*]   [*]  [*]   [*]  [*][*]    [*][*][*]
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           [*]   [*]  [*]   [*]  [*]  [*]  [*]    
           [*]   [*]  [*]   [*]  [*]   [*] [*]

Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
*****************************************************************



*********************************************************** 
Sajnos a Kulugyminiszterium a hirkozlemenyeket nem naponta, 
hanem nagyobb idokozonkent, nagyobb mennyisegbe tovabbitja. 
Igy elnezest kerek a rendszertelen es az oriasi terje-
delmu tovabbterjesztesert, ami valojaban nem az en hibam. 

Buchwald Amy
***********************************************************

N E W S L E T T E R

from the Daily Bulletin of the Hungarian News Agency MTI
distributed by the Department for Press and International Information
Ministry of Foreign Affairs, Republic of Hungary

H-1394, Budapest P.O.B. 423.
Telephone: 36 (1) 156-8000
Telefax: 36 (1) 156-3801
No. 79/1995                                                             21 Apri
l 1995

Prime Minister to Visit Strasbourg


        Budapest, April 20 (MTI) - Prime Minister Gyula Horn will travel to
Strasbourg on April 26 to attend the session of the Parliamentary Assembly of
the Council of Europe, the Government Spokesman's and Press Office
announced on Thursday.

        The Hungarian prime minister will hold talks with the president of the
Assembly and with the secretary-general of the Council.

        During his one-day visit to Strasbourg, Horn is expected to address the

plenary session of the assembly.

Condolences to President Clinton


        Budapest, April 20 (MTI) - President Arpad Goncz and Prime Minister
Gyula Horn today sent a message of sympathy to President Bill Clinton after
the bomb attack in Oklahoma City yesterday, the Foreign Ministry told MTI
today.

Staff Cuts in Public Administration


        Budapest, April 20 (MTI) - The Hungarian cabinet has set out
considerations for and scheduling of the 15 per cent staff cuts to be
implemented at ministries and national authorities, and at the regional state
administration bodies.

        The cabinet decided ministry leaders must submit specific proposals for

cuts of 10 per cent by May 15. The administrative state secretary of the Prime
Minister's Office, and the government commissioner in charge of streamlining
public administration will then have to work out the remaining 5 per cent
dismissal plan between May 15 and June 15, Government Commissioner Imre
Verebelyi told reporters after a Budapest cabinet session on Thursday.

        Verebelyi said the staff cuts in the ministries and national authoritie
s will
affect 6,500 positions. The first to go will be unfilled posts, followed by
civil
servants already of retirement age. Other considerations for dismissal are
rationalization of structures, tasks of declining importance, and poor work.

        By the cabinet decision, savings made by the dismissals will not be
withdrawn from departments, but will be used to improve the wages of
remaining workers.

        Other institutions of the ministries and national authorities will also
 have
to carry out 15 per cent cuts by the year end, under the cabinet's 15 per cent
staff cut resolution.

Foreign Currency Code - Cabinet Approves Draft


        Budapest, April 20 (MTI) - The Hungarian cabinet approved the draft of
the new foreign currency code that was submitted to its session by Minister of
Finance Lajos Bokros on Thursday.

        The bill is a step towards the convertibility of the Hungarian currency
,
the forint, and will make far more liberal foreign currency transactions
possible
for citizens and businesses.

        Briefing the press after the session, the Minister of Finance said citi
zens
will be able to use USD 800 per person a year for travel aims, and if
Parliament passes the bill they will be able to purchase foreign tourism
services for forints, without limit. Convertible currency can be freely bought
for
medical treatment abroad, for study costs, and court cases.

        The proposal is it will no longer be compulsory to deposit foreign
currency at banks - citizens could hold unlimited amounts. Having foreign bank
accounts continues to be prohibited.

        Capital exports will become free, if the share acquired through this
exceeds 25 per cent of the firm or venture in question. Entrepreneurs would no
longer have to request preliminary government permission for foreign loans
with maturities of over one year, just for those with maturities of less than
12
months.

        The draft foreign currency code still bans payments in foreign
currencies between domestic traders. If the code is approved by Parliament,
the National Bank of Hungary will act as the exclusive foreign currency
authority, but its powers will be more limited.

        Bokros said differences in views between the cabinet and the social
insurance authorities have not eased over the 1995 budget of the social
insurance authorities. Social insurance councils consider some resolutions
unacceptable. The cabinet therefore will submit the bill on the 1995 budget of
the social insurance local councils to Parliament in two versions: one will
include government ideas, the other proposals by social insurance specialists.

Moldovan President in Fejer County


        Budapest, April 20 (MTI) - Moldova hopes to buy 200 Ikarus buses for
two urban local councils, assemble an annual 100 buses, and cooperate in
industrial and agricultural research, it was announced during Moldovan
President Mircea Snegur's visit to Fejer county (central-western Hungary) on
Thursday.

        Mircea Snegur said the Szekesfehervar-based Videoton electronics
company experience in switching from earlier military manufacturing to civilian
production was extremely valuable. Moldovan delegates proposed Videoton
cooperate with Moldovan manufacturers and the Alfa group composing the
largest Moldovan electronics firms.

        In the Ikarus chassis and vehicle factory's Szekesfehervar unit, Snegur

showed interest in prices of urban and long-distance buses. Ikarus exported
1,250 vehicles to Moldova between 1982 and 1992.

        Moldova now intends to buy 200 urban buses. They were also
interested in setting up a unit to assemble an annual 100 buses.

        The Hungarian Academy of Sciences Farm Research Institute in
Martonvasar hopes to renew links with Moldovan farm research institutes, cut
off a few years ago. President Snegur himself was once the head of an
agricultural research institute.

Snegur Ends Visit, Press Conference


        Budapest, April 20 (MTI) - The revival of nationalism is the greatest
threat to Central and Eastern Europe. The surfacing of this either leads to
armed clashes, or holds out the threat of conflict. The emergence of crises
should be prevented, and Hungary, filling the presidency of the Organization
for Security and Cooperation in Europe (OSCE) this year, can do much in this
interest, Hungarian President Arpad Goncz said in Budapest on Thursday.

        Goncz and the Moldovan President, Mircea Snegur, jointly discussed
the three-day visit of the Moldovan head of state to Hungary, at a joint press
conference in Parliament building. The Hungarian president praised the six
agreements signed on Wednesday, and said the Hungarian-Moldovan basic
agreement was a model.

        As the current president of the OSCE, Hungary wishes to help settle the

status of the Dnester region in Moldova soon, respecting the interests of all
sides concerned, President Goncz said.

        Mircea Snegur announced he had invited President Goncz to visit the
Republic of Moldova.

        The Moldovan President and his entourage - concluding the three-day
official visit - left Budapest on Wednesday evening.


Kovacs in Washington - Economic Consultations


        Washington, April 20 (MTI) - The American Treasury Under-Secretary in
charge of international relations says the International Monetary Fund (IMF)
will pass a decision about the agreement to be made with Hungary as soon as
possible, Lawrence Summers told Hungarian Foreign Minister Laszlo Kovacs
during their meeting at a businessmen's lunch in Washington on Thursday.

        Kovacs said that American business groups considered the Hungarian
government"s economic stabilization and austerity measures as good, but
called attention to the fact that Hungary has already lost nearly five years:
it
must now act quickly and firmly.

        They thought that the current government, although with a delay of nine

months, was the first to familiarize people with the country's actual financial
and economic situation.

        Foreign Minister Kovacs is scheduled to meet U.S. Secretary of State
Warren Christopher in the late evening hours CET.


OSCE Office to Open in Grozny Next Tuesday


        Moscow, April 20 (MTI) - The permanent mission of the Organization for
Security and Cooperation in Europe (OSCE) will begin work in Grozny and in
the Chechen crisis area led by Hungarian diplomat Sandor Meszaros next
Tuesday, April 25, Istvan Gyarmati, envoy of the OSCE's chairman in office,
said in Moscow on Thursday.

        Gyarmati said the mission will consider its work successful if a Cheche
n
legislature and government able to agree with federal representatives can be
elected by the end of the year.

        The settlement of the crisis is conceivable only within the framework o
f
the Russian Federation, Gyarmati added.

        He said Hungarian Foreign Minister Laszlo Kovacs, the OSCE's
Chairman in Office, should also visit Chechnya in the future.


Strategy to "Sell" Hungary's EU Membership


        Budapest, April 20 (MTI) - A referendum is expected to decide about
Hungary joining the European Union, and the government plans to prepare the
public to vote the way it requires. The government has prepared a
communications strategy, under which the public should be informed in 1995-
96, people should be won over in 1997-99, and from 1999 citizens must be
mobilized in the interest of integration into the European Union.

        The communications programme defines the means with which the
government can influence society as a whole, and those with which it can
exert influence on certain groups. Part of the strategy is to provide articles
for
the national dailies, and independent programmes on television and radio
about the European Union.

        Plans are for videos presenting the European Union to children, and
conferences for teachers, journalists, and researchers.

        A European information and documentation centre is to be set up in
Parliament, in order to provide legal and business information.

        The inter-ministerial committee in charge sent the government
communications strategy to Prime Minister Gyula Horn and the cabinet on
Thursday, according to information from the Foreign Ministry.

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A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.

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           [*]   [*]  [*]   [*]  [*]   [*] [*]

Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
*****************************************************************



N E W S L E T T E R

from the Daily Bulletin of the Hungarian News Agency MTI
distributed by the Department for Press and International Information
Ministry of Foreign Affairs, Republic of Hungary

H-1394, Budapest P.O.B. 423.
Telephone: 36 (1) 156-8000
Telefax: 36 (1) 156-3801
No. 80/1995                                                             24 Apri
l 1995

Minister of Industry - OPIC Leader


        Budapest, April 21 (MTI) - American companies are interested in the
privatization of the Hungarian energy sector, the acting Vice-President of the
U.S. Overseas Private Investment Corporation (OPIC), Christopher Finn,
told Hungarian Minister of Industry and Trade Laszlo Pal, in Budapest on
Friday.

        Laszlo Pal and Christopher Finn agreed that the Hungarian side
would forward concrete investment proposals to OPIC.

        Christopher Finn offered assistance in scheduling meetings between
Hungarian Prime Minister Gyula Horn and potential American investors,
during Horn's visit to the United States from June 4 to 10.

        Finn and Pal reviewed the seven year old activity of OPIC in Hungary,
in the course of which it provided assistance for the investments of
American companies in Hungary on 22 occasions. Between 1989 and 1994,
the agency accepted obligations valued at more than USD 100 million in the
form of direct loans and loan guarantees. The value of its valid insurance
contracts is nearly USD 300 million.

        So far OPIC has financed, or insured, private investments valued at
USD 1.7 billion in the Central and Eastern European and the CIS countries.

Kovacs's Lecture - U.S. National Press Club


        Washington, April 21 (MTI) - Hungarian Foreign Minister Laszlo
Kovacs discussed the elements of the new European security model, the
Central and Eastern European prospects, and international issues during his
lecture and press conference in the National Press Club in Washington on
Friday.
        In the introductory part of his lecture, Kovacs briefly discussed the
recent opening of the regional FBI police academy in Budapest, underlining
the importance of the fight against organized crime and international
terrorism.

        In the context of the latter, Kovacs expressed, on behalf of the
Hungarian government, his sympathy and condolences for the victims of the
Oklahoma City bombing.

        Kovacs said the new European model must necessarily be
comprehensive and must extend to security, political, economic and
environmental protection elements.

        Discussing the Central and Eastern European region, Kovacs said
that, for the time being, the appropriate security structure is lacking. In
order
to screen out security risks, it would be necessary to create the internal
stability of the individual countries, to improve relations between the states,
in which context he mentioned the Hungarian-Slovak basic agreement, to
expand regional cooperation, and to extend the Euro-Atlantic system of
institutions towards the East.

        As regards the sanctions in force against Yugoslavia, the Hungarian
Foreign Minister, in his capacity as chairman in office of the Organization for
Security and Cooperation in Europe (OSCE), said Hungary is
understandably interested in the lifting of the sanctions because, on the one
hand, Hungarian losses originating from the observance of the sanctions are
already USD 2 billion, and, on the other hand, because there are no
opportunities to settle bilateral relations with Serbia.

        At the same time, Kovacs made it quite clear that Hungary will fully
observe the sanctions as long as these are in force.

Foreign Minister Kovacs Winds Up Washington Visit


        Washington, April 22 (MTI) - Hungarian Foreign Minister Laszlo
Kovacs says the substance of, and the atmosphere marking his talks in
Washington show that Hungarian-U.S. cooperation will gradually turn into a
partnership that carries in itself the possibility of an alliance in the medium
term, the foreign minister himself told journalists Friday evening.

        Earlier Friday he met Samuel Berger, executive senior national
security adviser, to discuss topical international issues and bilateral
relations.

        Kovacs said he had met representatives of the U.S. administration,
the business community and the American press, and emphasized at these
meetings that Hungary considers regular exchanges of view necessary and
wants to expand economic cooperation.

        Kovacs asked his negotiating partners to support Hungarian interests
in international institutions apart from encouraging investments in Hungary.

        As regards the expansion of NATO Kovacs spoke unequivocally in
favour of Hungary's accession, stressing that such a membership would not
be directed against anybody else, nor would Hungary use its status to
prevent the admission of others. He made it clear that Budapest wants to
join the alliance among the first countries, and said that the prospects of a
membership in itself have a stabilizing effect on Central Europe.

        Kovacs said American officials had stressed they were ready to
expand bilateral ties in many ways. He said his negotiating partners had
given positive replies to all concrete proposals and requests in practically
every case: they had supported Hungarian endeavours and hinted that
Hungary stood a good chance of being admitted to NATO among the first
countries.

        He said the United States had reacted positively to the economic
measures passed by the Hungarian government in March. The American
officials conceded that it took a great deal of political courage to bring
these
decisions. They also highly appreciated Hungary's foreign policy toward
neighbouring countries, which in their assessment can contribute to the
stabilization of the entire region.

Horn Interview for Polish Press


        Budapest, April 22 (MTI) - Polish Prime Minister Jozef Oleksy will pay
an official visit to Hungary on April 23-24 at the invitation of Prime Minister
Gyula Horn. The Hungarian Prime Minister gave an interview to Polish
newsmen on the occasion.

        The Government Spokesman's Office quoted Horn as saying that
there were many issue in Polish-Hungarian relations about which one could
hold negotiations practically every month, so the talks with Prime Minister
Oleksy would primarily be of a working nature.

        Horn said Hungary and Poland share identical views about integration
into the west. "Our chances of joining NATO and the European Union are
practically identical, so a continuos dialogue is needed. The talks will cover
international issues affecting both countries, problems about our neighours
and the Yugoslav crisis.

        In assessing bilateral economic relations, Horn said 1994 produced a
dynamic change in Hungarian-Polish trade. Trade increased by 30 per cent,
and exceeded USD 400 million. There are market reasons for the large-
scale Hungarian export.

        At the same time due to changes in the Hungarian economy, and its
GDP, areas such as mining, construction, investment either ceased or
decreased where Poland had played an active role.

        Horn said there was much to do in the sphere of economy, and we do
not know each other's opportunities.

        He noted that the two countries could submit a joint application for
loans extended by the European Bank for Reconstruction and Development,
could get together to develop the infrastructure, take part in the construction
of Hungarian motorways, and in cooperation affecting the vehicle industry,
and primarily the car industry.

        Prime Minister Horn described the political relations between the two
countries as harmonic, stressing the need to hold continuos consultations.

Socialists Nominate Goncz for Hungarian President


        Budapest, April 22 (MTI) - The Hungarian Socialist Party (HSP)
National Board supports the party presidium's proposal for nominating
Arpad Goncz for president of the republic, board chairman Ivan Vitanyi told
a press conference today. The proposal for supporting Goncz's reelection
was made almost unanimously, with a single abstention, he said.

        Although the idea of nominating a HSP member for the post was also
raised in the debate, the overwhelming majority argued that the party should
support a respected candidate who enjoys the confidence of the majority of
society including the Socialists, Vitanyi said.

        The Socialists wish to nominate a candidate who represents and
symbolizes the best endeavours of society and guarantees democracy and
social transformation in the coming five years. The HSP is convinced that
Goncz is the person who can fulfil all these expectations, Vitanyi said.

        Under the Constitution, the president of the republic is elected by
Parliament for a five-year term. The final deadline for the election is July 3,
1995 because President Goncz's mandate is to expire on August 3.

        The opposition Independent Smallholders' Party initiated a
referendum for the direct election of the head of state. The Smallholders
collected 105,000 signatures for a petition, 5,000 more than required for
calling a referendum. On the request of Parliament's Constitutional
Committee, the Constitutional Court is studying whether the Constitution can
be amended accordingly.

Hungarian Economic Delegation in Tokyo


        Tokyo, April 23 (MTI) - A delegation headed by Imre Dunai, secretary
of state at the Ministry of Industry and Trade, has opened a visit. The
delegation he is leading is comprised of representatives from the Ministry of
Industry and Trade, and the State Holding Plc in an effort to familiarize the
hosts with the new economic policyline recently adopted by the Hungarian
government.

        Dunai told MTI today that he intends to outline Hungarian investment
opportunities, relevant regulations, and concrete facilities displayed by
individual sectors or companies during his talks in Tokyo and Osaka.

        This is particularly important because although the value of foreign
investments in Hungary is already over USD 9 billion, the share of Japanese
capital is about two per cent, this being very little compared to Japan's
investor potential, Dunai stated.

        A further goal of the talks is to size up the remarks by leading
representatives of Japanese business circles and the companies active in
Hungary about the operation of the Hungarian economy.

Public Procurement Regulated by Law


        Budapest, April 23 (MTI) - From next January, all organizations,
financed from state funds, will have to select their suppliers through public
competition. This measure is expected to promote a more efficient
management of state property.

        Codified in the 1870s, Hungary's first law on public procurement was
modelled on the French law, and remained in force even during post-war
reconstruction (1945-48).

        The subsequent decrees regulating public procurement were rather
aimed at protecting what was called the socialist market.

        Put together earlier this year, the new legislation, passed by
Parliament recently, will affect about 5,000 organizations, including
businesses that have been granted government subsidies or loan
guarantees, firms enjoying a monopoly in Hungary, and public utility
companies.

        The law would oblige all of them to carry out a prequalification
procedure before launching investment projects worth more than HUF 200
million, or USD 1.7 million, and invite competitive tenders before purchasing
equipment worth more than HUF 10 million.

        For local authorities, these limits would be fixed at HUF 5 million and

HUF 2 million, respectively.

        Under the proposed legislation, the government can oblige buyers to
inform a government agency of their planned purchases so that the
advantages of centralized procurement could be exploited.

        The agency called the Council of Public Purchases would be set up
later to coordinate such transactions for bids in a gazette entitled
"Kozbeszerzesi Ertesito."

        According to government estimates public procurement amounts to
HUF 270 billion annually.

        Experts believe that HUF 120 billion worth of purchases will come
under the new law, and competitive tendering will bring about a 5-20 per
cent decrease in prices.

        According to estimates, 600-800 competitive tenders will be invited
annually.

        In a poll concluded by Sonda-Ipsos, three quarters of those asked
considered the law to be necessary and 40 per cent expected it to contribute
to the fight against corruption.

        Government experts say that the procedure of public procurement will
be governed by the general principles of openness and fair competition as
well as the principle of national preference.

        In accordance with the latter principle, priority will be given to
domestic labour and services over foreign ones.

        The law allows bids to be restricted to companies based in Hungary.

        Those employing Hungarian sub-contractors may also enjoy an
advantage.

        For instance, if a Hungarian product offered is only 10 per cent more
expensive than a foreign one, the former still has preference.

        A product or service is considered Hungarian if at least 50 per cent of

its value was contributed by Hungarian labour.

        The law will come into force in January 1996.

President Goncz in Dublin


        Dublin, April 23 (MTI) - President Arpad Goncz arrived in Dublin today
for a three-day official visit at the invitation of President Mary Robinson.

        President Goncz was accompanied by a large delegation of
businessmen, including executives of several foreign trade companies,
travel agencies, banks and trading firms.

        The Hungarian government in the delegation is represented by
Minister of Agriculture Laszlo Lakos and Tibor Draskovics, administrative
state secretary at the Finance Ministry.

        President Goncz, who arrived in Dublin along with his wife, will have a

busy schedule from Monday to Wednesday morning: he will hold several
rounds of talks with President Mary Robinson, meet Prime Minister John
Bruton, Minister for Foreign Affairs Dick Spring, and representatives of the
local opposition.

        Relations between Hungary and Ireland are free from problems, but
the economic ties could be improved: Trade between the two countries
totals less than USD 50 million, and within that Hungarian exports account
for less than USD 7 million.

        Nevertheless this modest trade represents a spectacular progress as
compared to figures registered in recent years.

        President Goncz's upcoming talks with executives of the Irish
economy, the local chamber of commerce and representatives of the Irish-
Hungarian Economic Society, are designed to encourage trade ties.
Polish Prime Minister Oleksy in Budapest


        Budapest, April 23 (MTI) - Polish Prime Minister Jozef Oleksy arrived
here early Sunday afternoon at the invitation of Prime Minister Gyula Horn.

        The government spokesman's office said Prime Minister Oleksy
would place a bouquet of flowers at the statue of the Polish-born general
Jozef Bem (1794-1850) who fought in the Hungarian 1848-1849 War of
Independence.

        This evening Horn and Oleksy will hold private talks.

        The Polish prime minister will be formally received in Kossuth square
outside Parliament on Monday, April 24.

        Later Monday the Hungarian and Polish delegations will hold plenary
talks in Parliament, before Speaker Zoltan Gal receives Prime Minister
Oleksy.

        Later Horn and Oleksy will hold a joint press conference to face the
press.

        On Monday afternoon the Polish Prime Minister will lay a wreath at
the Monument of Hungarian Heroes, thus ending his visit to Budapest.

OSCE Mission to Chechnya Arrives in Moscow


        Moscow, April 23 (MTI) - The six-member permanent mission to
Chechnya of the Organization for Security and Cooperation in Europe
(OSCE) headed by Hungarian diplomat Sandor Meszaros arrived in Moscow
tonight.

        The mission will open under a decision made by the OSCE
Permanent Council in Vienna earlier this month.

        The six diplomats are scheduled to leave for Grozny on Tuesday and
set to work with no delay.

        The delegation will pay its first fact-finding visit to Samashki from
where human rights violations have been reported.

        The mission led by Meszaros includes Philip Remler of the United
States, Olivier Pelen of France, Zenon Kochiak of Poland, Heidi Bagliavini of
Switzerland and Col. Sten Wadensjo, a Swedish military expert.

        "The Russian authorities have promised to make the two buildings
selected during our first visit to Grozny suitable for housing the mission,"
Meszaros told MTI.

        He confirmed that Hungarian Foreign Minister Laszlo Kovacs, OSCE
Chairman-in-Office, would also visit Chechnya but the concrete date has not
yet been fixed.

*****************************************************************
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Alapitvany tamogatja.

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Reposting is supported by Hungarian Human Rights Foundation News
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N E W S L E T T E R

from the Daily Bulletin of the Hungarian News Agency MTI
distributed by the Department for Press and International Information
Ministry of Foreign Affairs, Republic of Hungary

H-1394, Budapest P.O.B. 423.
Telephone: 36 (1) 156-8000
Telefax: 36 (1) 156-3801
No. 81/1995                                                             25 Apri
l 1995

Horn Meets Polish PM - Plenary Talks


        Budapest, April 24 (MTI) - Hungarian Prime Minister Gyula Horn
received his Polish counterpart, Jozef Oleksy, with military honours at Kossuth
Lajos Square, outside the Parliament building, on Monday morning.

        Oleksy arrived in Budapest at Horn's invitation on Sunday afternoon,
and the two men met for talks in the evening.

        After the reception ceremony, the Hungarian and Polish delegations
began their talks in Parliament led respectively by Horn and Oleksy.

        Following the negotiations, scheduled to last almost two hours, the
Speaker of Parliament Zoltan Gal will meet the Polish prime minister, who will
then hold a press conference jointly with Prime Minister Horn in Parliament.

Horn, Oleksy Hold Joint Press Conference


        Budapest, April 24 (MTI) - "Hungary and Poland intend to jointly put
together a so-called White Book that will sum up the terms of accession to the
European Union. The goals of the two countries are identical in achieving EU
and NATO memberships, with this determining the foreign policies pursued by
these countries," as Hungarian Prime Minister Gyula Horn and Polish Prime
Minister Jozef Oleksy summed up the results of their talks here today, at a
press conference in Parliament.

        The two prime ministers also agreed on the need to maintain
cooperation between the Visegrad group of four countries (Poland, the Czech
Republic, Slovakia and Hungary), as they said this regional relationship must
not be given up.
        The two prime ministers also said that their respective countries"
accession to NATO would not threaten Russia. They called for continuing the
dialogue on this issue between Poland and Russia on the one hand, and
between Hungary and Russia on the other.

        Commenting on bilateral cooperation they said the dialogue was
continuous, but the system of economic links has not yet developed in
adjustment to the fresh requirements of a market economy.

        For his part Oleksy stressed that he had come to Hungary after his
election, following his visit to Brussels, since Hungary and Poland were
countries that have always been able to understand one another.

        He said this also applies to integration into Europe.

        As regards NATO membership, Oleksy said neither NATO nor Poland
threatened anybody. He also said he agreed with Prime Minister Horn on the
issue of a free trade zone, and on expanding CEFTA to Romania and
Bulgaria, while the issue of involving the Baltic states was also raised. The
idea is to attain the reduction of customs tariffs to nil by 1998, although as
he
put it, the Hungarian side adopted a cautious approach on this issue.

        Prime Minister Horn told reporters he had expounded the Hungarian
position at the plenary talks, notably that accession of the two countries to
NATO was a process that he hoped was irreversible and which would be
completed in a relatively short period of time. This accession is vital because
of the great uncertainty prevailing in this region.

        Horn explained that dialogue was continuing between Hungary and
Russia over this issue.

        "We think that many reserves have been expressed on this question
and we need time to dispel them. One such reserve expressed by the
Russians is that they do not threaten us, so why should we join NATO.

        "For our part, we maintain that there are other risk factors involved,
and
NATO alone can safeguard our security while Russia cannot. In the long term,
however, one should in no way rule out relations between Russia and NATO,
as a matter of course, by meeting certain conditions," Horn said.

        Horn also said that the member states of the European Union were
setting many requirements related to transformation. The Hungarian side
agrees with these, but the western governments must take into consideration
the current situation since the implementation of the reforms can cause major
        "One cannot reform everything at the same time - for social policy, we
need time. At the same time the member states of the European Union are
justified in calling for the preservation of political stability.

        "All alone we are unable to meet such conditions, and they should also
examine ways of extending more effective support, with special regard to
investments underwritten by governments," Horn said.

        In answer to questions, the two prime ministers stated that while
cooperating, they would pursue an independent policy.

        On Monday Oleksy conferred with Speaker of Parliament Zoltan Gal,
and in the afternoon he laid a wreath at the monument of Hungarian Heroes.
With that he ended his visit to Budapest.

Polish Premier Calls on Gal


        Budapest, April 24 (MTI) - Poland and Hungary must make preparations
for joining the integration organizations of the European Union, and so the two
parliaments - with special regard to legal harmonization - must cooperate
closely, said Prime Minister Jozef Oleksy and Speaker of Parliament Zoltan
Gal at a meeting today when they discussed, behind closed doors, contacts
between the two parliaments, Emoke Kulcsar, head of Parliament's press
office, told MTI.

        Gal informed Oleksy about recent legislative work, and current
economic legislation.

        Commenting on foreign policy questions Gal said a six-party consensus
has developed regarding the three key goals (Euro-Atlantic integration, good
relations with neighbouring countries, and the constant and active
representation of the interests of Hungarians beyond the borders) pursued by
the Hungarian government.

        Oleksy asked his host about cooperation between the coalition and the
opposition parties, and relations within the coalition.

        Gal said there was good cooperation between the two parties in the
governing coalition, the Hungarian Socialist Party and the Alliance of Free
Democrats.

        Highlighting an example of the good relationship between the opposition

and the governing coalition, he mentioned the consultations between the six
parliamentary parties before the passing of important laws.
        Gal also spoke about the supervisory role Parliament is playing, and th
e
system of political days of debate called to life by the opposition, and the
establishment of investigative commissions.

President Goncz Holds Talks in Ireland


        Dublin, April 24 (MTI) - Hungary is committed to Euro-Atlantic
cooperation as this is a strategic goal on which all Hungarian parliamentary
parties agree, just as they do on Hungary's accession to European integration
organizations. There is no alternative to that, Hungarian head of state Arpad
Goncz said when he conferred with his host, President Mary Robinson, in
Dublin today.

        President Goncz opened an official visit to Ireland today, this being h
is
third meeting with President Mary Robinson. President Robinson visited
Budapest in 1993, and the two heads of state also had a round of talks at the
Davos Conference on World Economy in early 1995.

        Hungary is already gearing itself up for joining European integration
organizations as the process of legal harmonization, and the coordination of
statistical systems and standards has begun.

        Goncz also said that the Hungarian public should become better
acquainted with the terms and expected impacts of accession to the EU and in
this the Hungarian side wishes to rely on the experiences gained by Ireland, a
member of the European Community since 1973.

        The two presidents also discussed minority issues. This question is of
primary importance for Ireland since according to some figures, about 70
million people of Irish descent live beyond the borders of the republic, about
twenty times the country's population.

        President Goncz said Hungary seeks to forge closer links with ethnic
Hungarians abroad and intends to study the relevant Irish experiences.

        On Monday afternoon Goncz met representatives of the Irish-Hungarian
Economic Society. He told them that Hungary could primarily offer political
stability for Irish investors. Hungary was the first to proceed along the
hitherto
untrodden path of transition from a centralized economy to a market economy,
and is in the vanguard.

        On Tuesday Goncz is due to meet representatives of the Irish
opposition and will be the guest of honour at a working lunch, hosted by Prime
Minister John Bruton.

Goncz Holds Talks with PM Bruton


        Dublin, April 24 (MTI) - "In principle" Ireland supports Hungary's
accession to the Common Market, but it fears a conflict of interests in the
sphere of agriculture, Irish Prime Minister John Bruton told President Goncz
tonight.

        Goncz who held talks with Bruton in Dublin Monday evening,
expounded that the agricultures of the two countries were not rivals, instead
they complemented each other, and the Irish Hungarian agrarian spheres
were strong in varying spheres. Bruton concurred that there was no obstacle in
forging close ties between the two states.

        Goncz proposed close working relations between the two countries"
Foreign Affairs and Agriculture ministries next to the existing good labour
ties.

        Goncz asked Bruton - just as he had asked President Robinson earlier
today - for Ireland's support in Hungary's preparations for accession to the
EU.
        President Goncz also asked for Ireland's assistance in helping Hungary
and Central Europe receive invitations to attend a review EU conference in
1996 - when Ireland chairs the conference.

        President Goncz confirmed that Hungary wants to join the European
Union as a full member before the turn of the century.

        They compared notes on Hungary's accession to NATO. President
Goncz said the Partnership for Peace project is of great significance for
Hungary since it helps gradual rapprochement and catching up with the West.

        Hungary has stressed that the project is of an expansive type, and not
explosive.

        President Goncz invited Prime Minister Bruton to visit Hungary. Another

meeting is planned at a working luncheon on Tuesday.

Hungarian Defence Minister Visits Germany


        Budapest, April 24 (MTI) - Hungarian Defence Minister Gyorgy Keleti
and Parliamentary Defence Committee Chairman Imre Mecs today left for
Germany for three days of official talks on Hungary's accession to NATO, the
Partnership for Peace plan and the development of bilateral military relations.
The two politicians were invited by German Defence Minister Volker Ruhe.

        The talks will also include the Hungarian-German-British peace-
partnership exercise to be held in Hungary this autumn, and cooperation in
military technology.

        On Thursday, April 27, Keleti will travel to Poland, and in May he will

receive his Austrian and Romanian counterparts in Budapest and pay an
official visit to the United States.

Hungarian-German Defence Talks


        Bonn, April 24 (MTI) - Germany, just as in the past, will contribute
actively to sustaining the capabilities of the Hungarian army and to carrying
out
measures vital to accession to NATO, said Defence Minister Gyorgy Keleti
when he addressed a press conference jointly with the German Defence
Minister Volker Ruhe in Bonn today.

        The two ministers first held private talks, and later invited other
members of the two delegations to discuss top European security policy issues
and bilateral military cooperation.

        Keleti said an agreement on the protection of secrets was expected to
be signed before the summer, and this was particularly important since
Hungary wants to invite bids for several international tenders on developing
its
hardware.

        They also agreed to examine cooperation in the military industry.

        The German side offered considerable help for the establishment and
operation of a language training centre in Hungary. Keleti expressed thanks to
his hosts for the supply of components and equipment from the stockpiles of
the former East German army.

        Ruhe confirmed that MI-24 type of military helicopters had been offered

to Hungary from the East German stocks, but coordination is still continuing at
expert level.
        In connection with the eastward expansion of NATO, Keleti said it was
the firm determination of the Hungarian government to join the North Atlantic
Alliance, adding it was his hope that this could materialize before the turn of
the century. He said it gave rise to concern to hear the Russian position as
unpredictable regarding the expansion of NATO, since Russian politicians
were making conflicting statements. He said the Hungarian government
regards a decision on joining NATO as its domestic affair.

        Ruhe said individual states were completely free to decide on joining
NATO and the member states could not close themselves to such an
application, nor could any outside countries prevent it. He said the Hungarian
intention to join dovetailed with Germany's interests and can count on full
support. He stressed that NATO seeks security policy cooperation and
partnership with Moscow, but this could only be implemented in a spirit of
cooperation.

        The two ministers also discussed a joint Hungarian-German- British
military exercise to be staged in Hungary this coming autumn in the framework
of the Partnership for Peace project and which would be inspected by Ruhe.

        Keleti and Imre Mecs, chairman of Parliament's Defence Committee, will
visit several projects of the German army on Tuesday and Wednesday.



Kuncze and Deak in Brussels


        Brussels, April 24 (MTI) - Coalition Deputy Prime Minister and Minister

of the Interior Gabor Kuncze arrived in Brussels this evening for a one-day
visit
for talks with officials at the Belgian Ministry of the Interior and Member of
the
European Commission Anita Gradin, responsible for interior and judicial
cooperation.

        MTI learnt today that one of Kuncze's major topics will be the Schengen

agreement, which went into force in late March, and as a result how EU-
Hungarian interior cooperation will change, and the possibilities for forging
closer cooperation with countries that signed the Shengen agreement.

        After his arrival Kuncze drove to the residence of Hungarian
Ambassador Tibor Kiss for a working dinner and talks with his Belgian
counterpart, Deputy Prime Minister and Minister of the Interior Johan Vande
Lanotte.

        Colonel-General Janos Deak, commander of the Hungarian Armed
Forces, also arrived in the Belgian capital tonight to take part in a
conference
of the chiefs of staff and commanders of NATO and the North Atlantic
Cooperation Council.



Hungarian Secretary of State for Trade in Tokyo


        Tokyo, April 24 (MTI) - Hungarian Secretary of State for Industry and
Trade Imre Dunai summoned Japanese assistance to help Hungarian exports
gain easier access to Japanese markets, and help Japanese capital play a
more active role in Hungarian investments.

        Dunai held talks with senior officials at the Japanese Ministry of
International Trade and Industry (MITI), Deputy Minister Yoshimiro Sakamoto
and Director-General Takeshi Isayama in Tokyo today.

        Dunai later told MTI that he had reminded his negotiating partners that

the value of Hungarian imports from Japan had nearly totalled USD 400
million, while Hungarian exports bound for the island country were barely USD
100 million.

        Last year Hungarian exports to Japan grew by 7 per cent, while imports
from Japan by 14 per cent.

        He raised the possibility of extending a general preferential customs
treatment to Hungarian products, the one that is ensured by developed
countries to developing ones in order to facilitate market access.

        Dunai said he had been given promises by his Japanese negotiating
partners that they would study the issue, while Hungary pledged to put
together a list of products requiring preferential treatment.

        Dunai also informed his negotiating partners about the act on
privatization, stressing that the privatization of three major sectors, the
energy
industry, banks and telecommunications was yet to materialize.

        He also put forward a package of detailed proposals on concrete
investment opportunities, and asked MTI's assistance in invigorating interest
through Japanese capital.

Japanese FM on Horn's Possible Trip to Tokyo


        Tokyo, April 24 (MTI) - "If Hungarian Prime Minister Gyula Horn paid a
visit to Japan, it would be a significant event in the development of bilateral
relations," Japanese Foreign Minister Yohei Kono said in an interview with
foreign journalists, including MTI's correspondent, before his visit to Croatia
and Hungary this weekend.
        Kono said Horn's possible visit would probably also come up for
discussion during his Budapest trip. Assessing bilateral links, he recalled
that
he himself had visited Hungary several times, including his visits as chairman
of the Japanese-Hungarian Friendship Society, but this was the first time he
would come to Budapest as foreign minister. He stressed Hungary had
received the most Japanese capital among the Central European countries,
and believed that if Budapest made further efforts at improving the investment
environment, an increase could be expected in this field as well.


OSCE Permanent Mission in Grozny


        Moscow, April 24 (MTI) - The opening of a permanent mission in Grozny
could begin a new chapter in the history of the Organization for Security and
Cooperation in Europe, made possible by Russia agreeing that the OSCE
should contribute to normalizing the inner conflict, Sandor Meszaros, head of
the mission, told reporters in Moscow today. He indicated that among the top
priorities the mission wants to visit the region of Samaski and Bamut to find
out
about the situation there. They will report regularly on their activity to
Foreign
Minister Laszlo Kovacs, chairman-in-office of OSCE.

        Meszaros, head of the permanent mission in Grozny, said the six-
member mission would leave for Grozny early Tuesday morning. Its members
include diplomats American Philip Remler, the Frenchman Olivier Pelen, Polish
diplomat Zenon Kochiak, Swiss diplomat Heidi Tagliavini and Colonel Sten
Wadensjo, a Swedish military expert.

        The first and foremost duty of the mission is to end the fighting and
reach an agreement on a standing ceasefire, Meszaros noted.
        After that an intensive dialogue will be needed, with the involvement o
f
all sides concerned, to seek a political settlement.

        OSCE, he said is ready to promote negotiations in any form, and is
ready to take part in such talks, since the participation of the organization
can
add to their importance. The process of normalization should lead to free and
democratic elections in Chechnya.

        The OSCE is disposed to offer expertise in organizing the elections, an
d
to take part in monitoring them. Subsequently an elected government can start
negotiations with the central leadership on how to share power.

        Meszaros said OSCE seeks to contribute to the observance of human
rights and explore concrete cases of their violation. It also wishes to offer
humanitarian assistance and help refugees return to their home.

        The mission would like to meet representatives of the federal and local

powers, as well as those of the other side, President Djohar Dudaev and
representatives, and learn about their ideas on the quickest end to the war,
including those on a ceasefire. To that end they will study Prime Minister
Chenormyrdin's proposal on an unconditional conclusion to the fighting.

        A decision on setting up a permanent OSCE mission in Grozny and its
mandate was made by the OSCE Permanent Council in Vienna on April 12.

HUF 42.2 Billion Profit for NBH in 1994


        Budapest, April 24 (MTI) - The National Bank of Hungary (NBH) closed
last year with a balance sheet total of 4,024.2 billion, 16 per cent up from
the
previous year, mainly due to outplacements to the state and abroad. The
before-tax profit of the bank reached HUF 42.2 billion, in view of the interest
increase and inflation, HUF 29.4 billion more than in 1993.

        These figures were quoted at NBH's annual general meeting in
Budapest on Monday, where Finance Minister Lajos Bokros represented the
state as the owner of the shares.

        The increase in central bank sources was decisively due to foreign
sources computed in forints in the NBH books. These amounted to HUF 405.3
billion, 21 per cent up on 1993.

        At the same time, the NBH's share in the country's gross and net
foreign debts is gradually decreasing. The before-tax profit of HUF 42.2
billion
is the result of a revenue of HUF 333.8 billion and expenditure totalling HUF
291.6 billion. Of its before-tax profit, the bank will pay HUF 20.2 billion
dividend
to the central budget, so its after-tax profit was HUF 22 billion.

*****************************************************************
A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.

           [*]   [*]  [*]   [*]  [*][*]    [*][*][*]
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           [*]   [*]  [*]   [*]  [*]  [*]  [*]    
           [*]   [*]  [*]   [*]  [*]   [*] [*]

Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
*****************************************************************



N E W S L E T T E R

from the Daily Bulletin of the Hungarian News Agency MTI
distributed by the Department for Press and International Information
Ministry of Foreign Affairs, Republic of Hungary

H-1394, Budapest P.O.B. 423.
Telephone: 36 (1) 156-8000
Telefax: 36 (1) 156-3801
No. 82/1995                                                             26 Apri
l 1995

World Economic Forum in Budapest - Horn

        Budapest, April 25 (MTI) - Hungary continues to lead the transition to
a market economy in Central and Eastern Europe and is also ahead of the
other countries in privatization, Prime Minister Gyula Horn said, opening the
regional session of the Swiss World Economic Forum foundation in
Budapest on Tuesday.
        The two-day conference is being attended by over 100 leading
businessmen from Europe and overseas, who wish to become familiar with
the government"s economic stabilization programme, partly at meetings with
Hungarian ministers.
        Horn pointed out the key importance the security of the receiving
country has to foreign investors. He stressed there is political stability in
Hungary, with the employer side unambiguously supporting the
government"s programme, and a chance of compromise with employees as
well. Hungary has stable political structures, and it is the only country in
the
region where ethnic minorities have local self-governments.
        The prime minister said the government was striving for historical
reconciliation with the neighbouring countries. There are only three countries
- Austria, Romania and Serbia - with which Hungary has no bilateral treaty.
However, another round of expert talks on the basic treaty has already
begun with Romania.
        The principal task of the Hungarian government is to create
conditions for joining the European Union, mainly harmonization of the legal
systems and implementation of a modernization programme, Horn said,
adding that the core of the three-year economic development scheme would
be completed by the middle of May. The government is determined to
finalize the modernization package by the end of this year after coordinating
it with the World Bank, the Council of Europe, the European Union and the
European Investment and Development Bank. If carried out, it may help
Hungary become a financial servicing centre for the region, Horn said.
        Horn said that the implementation of the stabilization package
announced on March 12 may wipe out the remnants of state socialism for
good. The aim is to create a system of social provisions which will at last be
in line with the country's economic capabilities. The prime minister stressed
the government will carry out the envisaged economic measures under all
circumstances.
        As regards privatization, Horn refuted information, which he said was
based on misinterpretations, that the process of privatization has come to a
halt. He stated they wish to attain that private property gain dominance in
the Hungarian economy by 1995-97. If the current pace of privatization can
be maintained, capital worth USD 2-2.5 billion will flow into the country, he
said. According to the prime minister, the privatization programme would still
require about USD 8-10 billion to be properly carried out.
        After the opening address of Prime Minister Gyula Horn, the regional
session of the Swiss World Economic Forum foundation continued behind
closed doors in Budapest on Tuesday.
        Attila Karoly Soos, Secretary of State at the Hungarian Ministry of
Industry and Trade, later told MTI that the participants had responded
positively to the prime minister's speech. The businesspeople present
agreed that the government's austerity measures were truly needed for
cutting the deficit of the central budget. Most comments made at the session
of plenary nature emphasized the necessity of the Hungarian stabilization
package.
        The regional conference will continue on Wednesday in the various
sections.

Parliament Discusses Stabilization Measures

        Budapest, April 25 (MTI) - Should the Cabinet fail to introduce major
austerity measures this year, the economic management system would in
any case have to be corrected at the start of next year, but then, the
situation would be much worse, Finance Minister Lajos Bokros said this
morning in Parliament. He was justifying several amendments to the law
aimed at restoring the stability of the economy.
        The measures included in the package do not affect the budget
directly. They relate to various sectors of the economy and are aimed at
improving the economic situation. The government is asking Parliament to
approve them as a single package, the minister said.
        In 1993 and 1994, Hungary's exports increased by 5 per cent
annually while the growth of imports exceeded 35 per cent. Over the past
two years, the gross debt stock grew by USD 7.5 billion while foreign direct
investment only amounted to USD 3.8 billion. This intolerable situation
continued in the first few months of this year, with the budget deficit soaring
to HUF 150 billion by the end of March, Bokros said.
        The finance minister went on:
        "It is already apparent that the shortage of capital is getting worse
because government spending is sucking in resources."
        "Though there has been economic growth, the country's external
balance has still not improved, and one cannot expect the economy to
produce the resources needed to improve stability. If things continued in this
way, the deficit on current account would increase by a further HUF 6 to 7
billion and the debt could grow by a further USD 3 to 4 billion over this year
and next."
        "The government would probably face major problems in coping with
the external debt in 1996. Inflation would accelerate and monetary policy
would become more and more powerless to control the situation. Our basic
task is to reduce the demand of the public sector for credit. Thus the
stabilization package aims to introduce a number of amendments to taxation
in order to make it more equitable, to reduce illegal activity and increase
revenue. Minor amendments are necessary to the legislation on income tax
and the tax on company profits."
        He said a number of laws need amending for the sake of stabilization.
        The package includes, for instance, an amendment to the law on
public finance. Since the budget has cash-flow problems, the government
proposes that the amended law on public finance allow the siphoning off of
50 per cent of surplus revenues accruing from the basic activities of public
sector institutions.
        Legislation on the legal status of civil servants and public employees
will also be amended, to reduce government expenditure.
        To this end the government intends to tighten the rules on severance
pay and the financial rewards given to civil servants for outstanding
performances.
        Under the government's proposals local governments will be eligible
for HUF 6 billion worth of surplus subsidies for social purposes. In addition,
HUF 3 billion will be added to the employment fund to finance public works.
        According to Bokros, the most controversial part of the package deals
with the changes to the social services. In the future the government intends
to deliver services only to those in need.
        The present system outstrips Hungary's economic performance.
        The legal title of individuals to draw welfare benefits will be
terminated.
        The amount of family allowance, child care benefit, and the one-off
maternity payment, which replaces the pregnancy allowance, paid out to
individuals will depend on their income and wealth.
        However, child care allowance and child care aid, replacing child care
support, will remain unchanged for 80 per cent of families.

Kovacs on Basic Treaties

        Budapest, April 25 (MTI) - The security of Hungary, her economic
interests, the situation of ethnic Hungarians living beyond the country's
borders and Hungary's aim of integrating into Europe all justified the signing
of the Hungarian-Slovak basic treaty, and the continuation of negotiations on
a similar treaty with Romania, said Hungarian Foreign Minister Laszlo
Kovacs, at a meeting today, when he briefed representatives of various
voluntary organizations on current foreign policy issues.
        Commenting on the negotiations relating to the Hungarian-Romanian
basic treaty, Kovacs spoke about the unresolved issues that had prevented
agreement being reached.
        He said the Romanians were unwilling to allow as wide a use of the
mother tongue as that laid down in the Hungarian-Slovak treaty. They also
refuse to recognize the right of ethnic minorities to establish political
parties,
and by the same token the Romanians are unwilling to agree to bilateral
monitoring of observance of the future treaty, Kovacs said.

Prime Minister Horn Receives Head of LWF

        Budapest, April 25 (MTI) - Prime Minister Gyula Horn today received
in his office Ishmael Noko, General Secretary of the Geneva-based
Lutheran World Federation. They discussed Hungary's main foreign policy
goals, its relations with neighbouring countries, and its assessment of the
Yugoslav crisis. Other subjects discussed were Hungary's aim of integrating
into Europe and relations between the Hungarian state and the Church.
        Noko described the Hungarian-Slovak basic treaty and Hungary's
foreign policy towards neighbouring countries as exemplary.
        Horn said that in the view of the Hungarian government, professing a
religion and practicing it were a private individual matter, but the role
played
by the Church was a public affair.
        Bearing this in mind the socialist-liberal government guarantees the
freedom of conscience and religion, and the separation of Church and State
based on full equality and in accordance with the constitution and existing
legislation.


CE Parliamentary Assembly - Hungarian Proposal

        Strasbourg, April 25 (MTI) - The Hungarian delegation to the
Strasbourg session of the Council of Europe (CE) Parliamentary Assembly
on Tuesday submitted a proposed amendment for the assembly to settle
definitively the dispute surrounding resolution no. 1201 on the minorities.
The body itself continues to consider the resolution passed two years ago
and determining a wide range of minority rights to be effective, while
Parliamentary Assembly President Miguel-Angel Martinez caused great
surprise by describing the document as "dead" during his recent visit to
Romania.
        Hungarian delegation head Andras Barsony, Deputy Chairman of the
Hungarian Parliament's Foreign Affairs Committee, today said that
according to the proposal, the assembly should state that checking
compliance with the contents of the resolution no. 1201 will be a basic point
in monitoring any member countries. Two assembly committees, dealing
with political affairs and the minorities, adopted the proposal on Tuesday
morning. The document, which has been attached to the so-called
Columberg report on the operation of the monitoring system, will be
discussed by the assembly on Wednesday. Barsony saw a good chance for
its adoption (it has also been signed by leaders of the political groups
forming the assembly), in which case the body will reconfirm the validity of
resolution no. 1201.
        At his opening press conference, Martinez withdrew his previous
remarks and called the resolution invariably effective, warning Bucharest
separately to the earlier Romanian commitment to observe the document.


Japanese Foreign Minister to Visit Hungary


        Tokyo, April 25 (MTI) - Japanese Deputy Prime Minister and Foreign
Minister Yohei Kono is to pay visits to Croatia and Hungary between April 28
and May 2, a Japanese Foreign Ministry official told MTI on Tuesday.
        Kono will hold talks with Hungarian Prime Minister Gyula Horn and
Foreign Minister Laszlo Kovacs on strengthening bilateral relations.
        In Budapest, the Japanese foreign minister is scheduled to hold talks
with Macedonian Foreign Minister Stevo Crvenkovski and a senior
government official of the Federal Republic of Yugoslavia.
        According to the information of "Nepszabadsag", Hungary's largest
circulation daily, Kono is going to mediate between the parties involved in
the Yugoslav crisis.


Permanent OSCE Mission Arrives in Chechnya


        Moscow, April 25 (MTI) - The six-member permanent mission to
Chechnya, set up by the Organization for Security and Cooperation in
Europe (OSCE), and which is led by Hungarian diplomat Sandor Meszaros,
left Moscow for Grozny on Tuesday morning, and will begin its work
immediately.
        At Grozny airport, the delegation was met by Nikolay Semionov, head
of the provisional administration in Chechnya.
        The purpose of the mission is to promote a peaceful, negotiated
settlement of the Chechen crisis, Meszaros told a press conference in
Moscow on Monday.
        Meszaros said priority should be given to achieving a cessation of
hostilities, which would be followed by negotiations on a political solution
involving all the parties concerned.
        The mission will first pay a fact-finding visit to Samashki from where
gross human rights violations were reported during a Russian attack earlier
this month.
        The mission has a six-month mandate but it can be extended, if need
be. It will maintain permanent contact with OSCE Chairman-in-Office Laszlo
Kovacs, the Hungarian Foreign Minister, who is scheduled to visit Grozny at
a later date.

Suchman Meets Lantos

        Budapest, April 25 (MTI) - Tamas Suchman, minister without portfolio
responsible for privatization, today received in his office Hungarian-born
businessman Tom Lantos, a member of the U.S. House of Representatives,
and the delegation of American businessmen accompanying him.
        They discussed Prime Minister Gyula Horn's planned visit to the
United States in June.
        The main subject of the talks, however, was the privatization bill, and

in particular, the policy behind it and the companies to be privatized.
        At the meeting, Lantos confirmed that the interest of American
business circles in investing in Hungarian privatization has not lessened.

Tom Lantos Meets the Press in Budapest

        Budapest, April 25 (MTI) - Wrapping up his talks in Budapest, Tom
Lantos, Hungarian-born member of the U.S. Congress, told reporters on
Tuesday he would ask President Bill Clinton and the U.S. secretary of the
treasury to increasingly use their influence and persuade the International
Monetary Fund (IMF) and other international organizations to give Hungary
the long-overdue and fully deserved financial support.
        In this context, Lantos noted the implementation of several major
international financial packages depend on whether the global institutions
agree with the government"s programme. The programme of the Hungarian
government is worthy of support, he added.
        Lantos also expressed his firm support for Hungary's admission to
NATO. On his visit to Moscow on May 9, Clinton will discuss the
enlargement of the North Atlantic alliance with President Boris Yeltsin. On
this score, Lantos said they had made it clear to their Russian partners that
though they understand Russia's foreign policy efforts, the United States is
still convinced that NATO plays a positive, stabilizing role in Europe. It has
been from the onset a defence alliance with an extremely constructive role,
in addition to its security aspect, as countries joining NATO at the same time
strengthen their internal democratic order, economy and stability. Lantos
said he hoped Hungary would be in the small group of nations that can join
the organization in the first round, which would immensely boost the
country's security. He also believed that its membership in NATO would
strengthen Hungary's democratic forces as well.
        Lantos stressed he would use all his influence, also as congressman
dealing with the European Union, to help Hungary in joining the EU.
Hungary is perfectly suitable for EU membership, and its accession is also
dictated by its historical traditions, Lantos said.
        Concerning Prime Minister Gyula Horn's June visit to the United
States, the congressman emphasized: President Clinton is looking forward
to the visit of the Hungarian prime minister, and the same holds for
congressional deputies, and leading representatives of business life and the
press. In the view of the American politician, Horn's trip will be of
historical
significance. Answering a question, Lantos said he expected an increase in
U.S. investments in Hungary after Horn's visit.
        In reply to another question, Lantos spoke on the importance of
Clinton's trip to Moscow on May 9. He said the visit of historical significance
would be on the occasion that the Russian people made huge sacrifices in
liberating Europe from Nazi autocracy 50 years ago. Although Washington is
familiar with the events in Chechnya, the leaders of the one-time allies still
have to express jointly their will to preserve peace and security.

Goncz's Visit - Statement by Irish President

        Dublin, April 25 (MTI) - Today, on the third and final day of his visit
 to
Ireland, President Arpad Goncz met for brief talks with representatives of the
opposition parties.
        Later, in an address to the Irish Parliament's Foreign and European
Affairs Committee, President Goncz said that Hungary was striving to
become a full member of the European Union before the end of the decade.
        He said it would be wrong for the two countries to treat each other as
rivals, since the influence of the smaller members of the EU will be
increased by Hungary's accession.
        "President Goncz's visit to Ireland will give a great impetus to trade,

cultural and personal ties between the two states," said President Mary
Robinson when she spoke to Hungarian journalists on bilateral relations
today.
        In answer to a question from MTI's correspondent, President Mary
Robinson said, "Ireland is determined to see that the Europe of the future
should not only be a Europe of large states, and we need good allies to help
us in this."
        The Irish President said she was sure that the Irish and Hungarian
agricultural sectors could cooperate extremely well, since agricultural output
in the two countries was fundamentally different.
        President Goncz will sum up his visit to Ireland at a press conference
on Wednesday morning, and after winding up his four-day  official visit to
Ireland, will return to Hungary.

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A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.

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