Wednesday, 19 April 1995
Volume 2, Issue 76


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

**HUNGARY PREDICTS SLOW GROWTH IN '95**
  Hungary's Finance Ministry said it expects the county's economy
  to stagnate or grow only slightly this year.  That's because
  of the government's recently announced austerity package.  The
  plan includes cuts in welfare benefits, regular devaluation of
  the forint and a hike in import duties.  The ministry predicts
  domestic consumption will fall about 3.5 percent this year.
  It also expects exports to grow by 10 percent.


**NOMURA SEES HUNGARIAN-MEXICAN SIMILARITIES**
  The Nomura Research Institute said Hungary faces a financial
  crisis similar to the one Mexico suffered starting at the end
  of last year.  Nomura said more than a third of Hungary's
  foreign currency reserves are in so-called hot money, meaning
  they can be withdrawn suddenly.  This was the case last month
  when a good portion of the country's hard-currency savings
  were withdrawn in a mini bank panic.  Hungary's National Bank
  disputes the Nomura report, and said that unlike Mexico,
  Hungary's foreign investments are largely in long-term
  corporate commitments, and not in short-term securities.


**HUNGARIAN COMPANY TO MARKET ITS SHARES IN THE US**
  Hungary's Novotrade plans to make its shares available to US
  investors via American Depository Receipts, or ADRs.  The
  company said the ADRs would provide easy access to its shares
  overseas, without the marketing and disclosure requirements of
  US stock markets.  The listing must still win the approval of
  Hungary's National Bank, the State Securities and Bourse
  Supervision authority and the American Securities and Exchange
  Commission.


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

**CENTRAL EUROPEANS CAUGHT IN THE MIDDLE**
  By David Fondler, in cooperation with Business Central Europe

  They've generally got two children, two cars and a two-car
  garage.  They probably own a house or apartment, along with
  their own business.  They're not rich or poor, they're in the
  middle.  And while they look like a new central European
  middle class, another name for them would be the survivors.

  Central Europe's nouveau riche are hard to miss with their
  Mercedes Benzes and mobile phones.  The poor stand out begging
  on street corners, the working class can be seen digging
  ditches and driving taxis.  All are products of central
  Europe's economic transition, some as victims, others as
  victors.

  But probably the most invisible, yet resilient, members of the
  region's new social order are the middle class.  They've
  benefitted from the transition to a market economy by building
  their own family and business nest eggs.  And in the process,
  they're replacing communism's former white-collar working
  class.  Greg Gransden, politics and economics editor at
  Business Central Europe, describes who these people are:

  "Basically the entrepreneurial class, this whole class of people
  that didn't exist under communism.  They've risen up in terms
  of purchasing power, whereas in terms of education, culture
  and social outlook, they're not middle class, so in a sense,
  there's a bit of a contradiction."

  But it's only a contradiction if one defines middle class in
  western terms.  The western middle class tends to be well-
  educated, well-paid employees of corporations.  Its eastern
  counterparts are generally under-educated, hard-working
  business owners, not necessarily executives, but
  restaurateurs, small retailers or operators of home-based
  companies.

  "They're the people who've adapted best to the transition.
  They're people who are individualistic, hearty, adaptable,
  dynamic, but they're not necessarily stable and predictable at
  all."

  Gransden said this unpredictability makes the middle class hard
  to define and measure.  In simplest terms, middle class
  central Europeans can be defined by disposable income and
  quality of life.  Sociologists estimate they make up about 20
  percent of the region's population.  But that differs markedly
  from country to country, based largely on the extent of a
  nation's economic transition.  The growth of the middle class
  seems to have been nurtured most in Hungary and the Czech
  Republic.  It's emerging in Poland, and is still practically
  non-existent in Russia and Bulgaria.

  One problem members of the middle class face is they're
  politically disaffected.  That's because they've made it on
  they're own, and seem to think that politicians couldn't and
  shouldn't help them.  Gransden said that's a mistake:

  "You've got to realize where your interests lie.  Traditionally,
  the interests of the middle class, who have acquired a stake
  in the market economy, they have to vote for parties who are
  going to protect that stake."

  But central European politicians have been remiss in courting
  this new voting bloc.  In fact, few parties even try to cater
  to the middle class.  Only in the Czech Republic, which had a
  pre-communist middle class legacy, has the government been
  able to fulfill the needs of these voters.  And politically,
  these needs seem basic: protection of private property,
  freedom from government confiscation, a fair taxation system,
  law and order.  But whether these needs will give rise to a
  political voice remains to be seen.



SURVEY
------

**HUNGARY'S PURSUIT OF THE PAST RAISES NEW QUESTIONS**
  By David Fink

  Hungary's law to expose former secret police informers is
  engulfed in controversy.  Critics point out that it was never
  illegal to be an informer.  Members of an investigative panel
  established by Parliament last year were told to ferret out
  former communist informers who now hold public office.  But
  the committee is accusing the government of hindering its
  investigation.

  The issue of secret police informers in government has caused
  heated debate in the Hungarian Parliament.  It reopens a past
  many would prefer to forget.  Under communism, Hungary's
  feared III/III secret police created a massive network of
  informers.  Many joined willingly, others were pressured.  It
  was never illegal to be a secret police informer, still the
  records containing the names are sealed.  Some of those past
  informers now hold public office and include members of
  Parliament.  To prevent public officials from being
  blackmailed, the so-called agent law was passed in 1994
  setting up a committee of judges to probe the backgrounds of
  15,000 public figures.  The committee will publicize the names
  of ex-informers and communist party militia members who refuse
  to resign.  Istvan Szikinger is a constitutional law expert.
  He said while the committe is constitutional, its activities
  raise troubling questions.

  "It is impossible to do such an investigation justly.  That is
  my opinion.  All of us were involved in the former regime and
  I think it would be unjust to pick out certain people and
  point at them."

  Szikinger said under communism, everybody had to make
  compromises, even the judges who're now heading the
  investigation.  Parliament's National Security Committee wants
  to remove two of the three judges on the panel, including
  chairman Jozsef Eigner, because they passed sentences in
  political trials during the 1950s.  Parliament is expected to
  vote on the judges' removal later this week.  Eigner has vowed
  to appeal his dismissal all the way to the European Court if
  necessary.  Eigner argued he's qualified because his sentences
  were never overturned.  He said Parliament and the government
  are simply trying to hinder his investigation.

  "The Constitutional Court has stated that Parliament has broken
  the constitution by failing to pass a rule that obliges
  government agencies, in addition to the defense and interior
  ministries, to provide us with information.  If Parliament
  wants to see the agent law executed, they should deal with
  passing this legislation rather than being absorbed with
  removing me."

  In fact, Parliament hasn't yet passed that kind of legislation.
  And it hasn't even been introduced for debate.  Eigner said
  many parliamentary deputies could be finding the investigation
  embarrassing, including Prime Minister Gyula Horn, who was a
  member of a communist militia involved in putting down the
  1956 revolution.

  "If all three committees are going to work, then the letter H
  will be investigated very soon.  It may create a very
  interesting situation.  After investigating Horn's past, we
  may ask him to resign.  We will inform the news agencies that
  he has to do this."

  But despite all the trouble, Free Democrat Member of Parliament
  Ferenc Koszeg said Parliament has been cooperating with
  Eigner's investigation, adding that it's important for
  Hungarian democracy.

  "Participants of the public life belong to the public.  The
  public has the right.  The voters have the right to know about
  the past of the politicians."

  Koszeg said Hungary's Constitutional Court has ruled that all
  Hungarians have the right to find out what's in their secret
  police file.  He said this means Parliament must pass a law
  giving ordinary people access to secret police records.  If
  that happens, there won't be a need for the judges'
  investigation.  But until then, their probe will continue. And
  controversy will be sure to follow, as one chapter of
  Hungary's dark past is brought to light.


ABOUT CET ON-LINE
-----------------

* CET On-Line is Copyright (c) 1995 Word Up! Inc., New Media
  Group, all rights reserved.  Not-for-profit redistribution of
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  For-profit distribution of this publication or the information
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  conditions are subject to change without notice.  For further
  information, contact Cameron M. Hewes at >


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  editorial content should be directed to Nancy Marshall at
  >.  Any comments about distribution or
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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
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*****************************************************************




Thursday, 20 April 1995
Volume 2, Issue 78

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

**HUNGARY TO FLOAT SHIPPER**
  Hungary plans to sell off the state shipping company Mahart.
  State Property Agency officials said a proposal for Mahart's
  privatization will be submitted to the government by mid-May.
  Mahart is worth about $42.5 million.  It's mostly concerned
  with shipping along the Danube River, but also has sea-going
  vessels.  The privatization will include sale of a south
  Budapest port on the Danube, where several other companies
  operate.



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

**NOBODY'S WORKIN' ON THE RAILROAD IN HUNGARY**
  By David Fondler
  
  Most of Hungary's rail system will grind to a halt today as all
  engineers, conductors and station workers begin an indefinite
  strike.  At stake is who will control the restructuring of
  Hungary's train system.  At midnight last night, some 65,000
  rail workers throughout Hungary were expected to walk off the
  job.  Their last contract expired in March, and union and
  railway negotiators remain deadlocked over union veto power of
  management decisions.  Tomas Szentgyorgyi is deputy general
  manager for economics at the Hungary state railway, MAV.  He
  described the effect of the strike:

  "The whole international passenger and freight traffic are
  blocked totally 100 percent.  Only the domestic traffic will
  be operated and only 472 trains in domestic passenger and 38
  trains in the freight traffic."

  This means that international trains will be stopped at the
  border, and not permitted to enter Hungary.  In terms of
  monetary losses.
 
  "We estimate 220 million forints per day turnover income loss,
  but we have, of course, expenditure cuts, and the total loss
  of the strike run about 89-90 million per day."

  That's about $750,000 a day, according to MAV.  But other
  published estimates say the railway could lose up to 1 billion
  forints, or slightly more that $8 million a day.  MAV expects
  to lose more than $195 million this year, with or without the
  strike. 
  
  Szentgyorgyi said the main point in the strike is whether the
  company will have the final say in setting workers' schedules.
  With a company re-structuring planned, union officials worry
  about guaranteeing workers' security.  So they want veto power
  over MAV's re-structuring and operations.  Szentgyorgyi agreed
  the grievances are about more than money and scheduling,
  they're about power:

  "We would like to manage our market-oriented company
  restructuring.  The restructuring will be minimum four years. 
  But to survive in this economic situation is a very short-term
  task, and we want to argue to the union that they have to give
  up some privileges."

  Still, MAV officials said the union and company are close to an
  agreement.  They expect the strike to last only four or five
  days. In fact, the union had originally considered calling
  just a 72-hour warning strike, before deciding on the
  unlimited walkout.  A strike threat last December earned
  workers a 12-percent raise.  MAV said this time it's not going
  to back down. In the meantime, it's advising prospective
  passengers to call local train stations or the central ticket
  offices in Budapest for help making alternative travel plans.   



ABOUT CET ON-LINE
-----------------
  
* CET On-Line is Copyright (c) 1995 Word Up! Inc., New Media
  Group, all rights reserved.  Not-for-profit redistribution of
  CET On-Line in electronic format is allowed only if the
  copyright notice, and all other copyright and by-line
  information contained in this publication is included. 
  For-profit distribution of this publication or the information
  contained herein is strictly prohibited without the express
  written permission of Word Up! Inc., New Media Group.  These
  conditions are subject to change without notice.  For further
  information, contact Cameron M. Hewes at >

  
* All "Letters to the Editor" and other comments about
  editorial content should be directed to Nancy Marshall at
  >.  Any comments about distribution or
  production should be directed to Cameron M. Hewes at
  >.
 
  
**CET On-Line** is a Word Up! Inc., New Media Group
  Publication.  The New Media Group also publishes the Prague
  Financial Monitor on-line.  For more information on the Prague
  FM, send a message with the word INFO in the body of a message
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**Subscription Information** 
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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
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*****************************************************************



OMRI DAILY DIGEST
No. 78, 20 April 1995

HUNGARIAN GOVERNMENT TO REDUCE SUBSIDIES TO POLITICAL PARTIES. The
Hungarian government on 18 April revealed plans to cut state subsidies
to political parties by 15% as part of its austerity measures designed
to reduce the budget deficit, Magyar Hirlap reported the next day. While
the government cited economic reasons for the cuts, the opposition
parties charged that the move was politically motivated and expressed
fears that it would endanger multi-party democracy in Hungary. Many
parties are experiencing financial difficulties because of loans they
took out to cover the campaign costs for national and local elections.
Several were forced to sell or rent party property and to reduce
personnel. -- Edith Oltay, OMRI, Inc.

HUNGARY, MOLDOVA SIGN FRIENDSHIP TREATY. Hungarian President Arpad Goncz
and his Moldovan counterpart, Mircea Snegur, signed a bilateral
friendship treaty in Budapest on 19 April, international agencies
reported the next day. Leading officials from various Hungarian and
Moldovan ministries signed agreements on the avoidance of double
taxation, investment protection, cultural cooperation, and civil
aviation. Snegur and Goncz discussed at length the question of minority
rights and stressed that their countries were in full agreement on the
treatment of minorities. In the past, Hungary has expressed strong
support for Moldovan policies on minorities in general and for granting
territorial autonomy to the Gagauz minority in particular. -- Edith
Oltay and Michael Shafir, OMRI, Inc.

MAJOR ROMANIAN POLITICAL FORMATIONS HOLD SURPRISE MEETING. The
leaderships of the Party for Social Democracy in Romania (PDSR), the
dominant government formation, and the Hungarian Democratic Federation
of Romania (UDMR) held a surprise meeting on 19 April. Radio Bucharest
and Romanian Television quoted the chairmen of the two formations as
saying that the meeting should not be interpreted as indicating a
"partnership" or "alliance" between the two groups. PDSR executive
chairman Adrian Nastase said the participants discussed the possibility
of organizing a "colloquium" of parliament parties to debate and clarify
such disputed concepts as "autonomy." UDMR executive chairman Csaba
Takacs said the PDSR must overcome its mistrust and collaborate with his
formation "on those points where there is common ground." He stressed
that both the UDMR and the PDSR support Romania's integration in
"European structures." -- Michael Shafir, OMRI, Inc.

[As of 12:00 CET]

Compiled by Jan Cleave

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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.
*****************************************************************



OMRI DAILY DIGEST
No. 79, 21 April 1995

SLOVAK OPPOSITION LEADER ON MEDIA. Hungarian Civic Party Chairman Laszlo
Nagy on 20 April said the previous week had been "black" for the
independent Slovak press, Slovak media reported. He cited the Finance
Ministry's decision to remove the license of the investment firm Prva
Slovenska Investicna Spolocnost (PSIS), giving temporary control over
its portfolio to Agroinvest and Harvard Investment (the latter is run by
the father of Movement for a Democratic Slovakia deputy and newly
appointed Slovak Information Service director Ivan Lexa). The PSIS is a
shareholder in the firm that publishes the opposition daily Sme. Nagy
commented that the decision could soon have a negative impact on the
paper's editorial staff. He also criticized the fact that a majority of
shares in Perex, which publishes the daily Pravda, were recently sold to
Harvard Investment. -- Sharon Fisher, OMRI, Inc.

HUNGARY'S RAILROAD WORKERS GO ON STRIKE. Hungarian railroad workers
began an indefinite strike at midnight on 20 April, Magyar Hirlap
reported the same day. All international rail traffic was halted and
domestic services reduced to a minimum. Hungarian Railways (MAV) and
union leaders failed after weeks of negotiations to reach agreement over
the text of a new collective labor contract. The main bone of contention
was the unions' right to reject restructuring proposals and cutbacks
that would deprive workers of overtime pay and bonuses. Union leaders
charged that MAV was seeking to push through restructuring plans that
could lead to mass lay-offs and less job security for those employees
who remained. MAV's management stressed the need to revamp the
corporation in order to reduce huge losses. It is estimated that the
Hungarian economy will lose 700 million forint a day as a result of the
strike. -- Edith Oltay, OMRI, Inc.

[As of 12:00 CET]

Compiled by Jan Cleave

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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.
*****************************************************************



Friday, 21 April 1995
Volume 2, Issue 79

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

**HUNGARIAN TRAIN STRIKE DERAILS CENTRAL EUROPE**
  An indefinite strike by more than 60,000 workers at the
  Hungarian railway MAV has hurt passenger and freight traffic
  throughout Central Europe.  All trains entering and leaving
  Hungary have been stopped.  Most domestic passenger traffic
  has also been curtailed.  Issues in the strike include
  workers' scheduling and pay increases.  But union officials
  said they're also worried about a planned MAV restructuring,
  and would like veto power over some corporate decisions.  MAV
  officials said the two sides are close to an agreement.  And a
  union official said yesterday only one issue remains
  unresolved.  But train driver Arpad Palotai, a strike
  committee leader at Budapest's Keleti train station, said
  negotiations have been rocky at times:

  "There was a situation in the negotiations where the MAV leader
  said he doesn't want to negotiate with the strikers, and then
  came a person from the labor ministry, and with his help, they
  started the negotiation again. "

  Palotai said he doesn't know how long the strike will last, but
  the union expects it to end tomorrow.  MAV said it's losing
  almost $6 million a day during the work stoppagee.


ABOUT CET ON-LINE
-----------------
  
* CET On-Line is Copyright (c) 1995 Word Up! Inc., New Media
  Group, all rights reserved.  Not-for-profit redistribution of
  CET On-Line in electronic format is allowed only if the
  copyright notice, and all other copyright and by-line
  information contained in this publication is included. 
  For-profit distribution of this publication or the information
  contained herein is strictly prohibited without the express
  written permission of Word Up! Inc., New Media Group.  These
  conditions are subject to change without notice.  For further
  information, contact Cameron M. Hewes at >

  
* All "Letters to the Editor" and other comments about
  editorial content should be directed to Nancy Marshall at
  >.  Any comments about distribution or
  production should be directed to Cameron M. Hewes at
  >.
 
  
**CET On-Line** is a Word Up! Inc., New Media Group
  Publication.  The New Media Group also publishes the Prague
  Financial Monitor on-line.  For more information on the Prague
  FM, send a message with the word INFO in the body of a message
  to >.
  
  
**Subscription Information** 
  CET On-Line is a free e-publication.  Subscribe by sending a
  message with the word SUBSCRIBE in the body of a message to
  >.  For an automated information
  response, send a blank message to >.

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

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

Reposting is supported by Hungarian Human Rights Foundation News
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