Caspian Energy Journal Caspian European Club
Friday, 13 May 2016 16:00

SGC is of great importance - Ambassador of Hungary to Azerbaijan Imre Laszlóczki Featured

We want speedy removal of sanctions


CE: Mr. Ambassador, in one of your interviews, given in December of the last year, you said that your goal is to expand trade-economic activity between the two countries. What helps and hinders you to establish relations in this sphere? The goal to ensure a trade turnover worth $100mln, is it a limit or you see much broader opportunities?

Imre Laszlóczki, Ambassador Extraordinary and Plenipotentiary of Hungary to the Republic of Azerbaijan: InCaucasus we have the most dynamic development of relations with Azerbaijan. Stable increase of the goods turnover has been observed since 2013. Intensivedialogueheld on a high level, revived negotiations between the ministries, active economic diplomacy and cooperation of business structures have certainly played an important role in this process. These positive processes are perfectly reflected in the Memorandum of Startegic Partnerhsip signed in 2014.

I think that 2015 was a hard year in terms of economy both for Azerbaijan and other countries of the region. Mutual sanctions of Russia and EU have affected our economies. Therefore, we wish for sooner lifting of sanctions.

Despite all this, according to the Hungarian data, though the Azerbaijani-Hungarian goods turnover reduced a little in 2015 but anyway made it to $65.9 mln. I find it a favorable result as the devaluation of manat has totaled almost 90% over the last year, external trade of Azerbaijan declined and low oil prices caused the reduction of budget funds.

In general, I believe that over the last year Hungary’s positions in the Azerbaijani market have become even stronger.

Leading Hungarian export goods are well known medications, electric machines and equipment, Suzuki and Mercedes automobiles, food products and live cattle.

In my opinion, commodity turnover between Azerbaijan and Hungary will reach $100mln in the medium term, especially if Azerbaijan’s export increases (it totaled $79,000 in 2015). Of course, in addition to the increase of the goods turnover our major goal is to encourage mutual investments and project cooperation. As far as concrete projects are concerned, I would like to note a successful cooperation between the Budapest Water Channel and AZERSU, contacts between Azeryolservis and its Hungarian partner organizations in the field of construction of motor roads, or the ongoing supplies of Hungarian breeding stock to Azerbaijan. Over the last year the Hungarian companies have won tenders of international organizations in the field of veterinary science, within the framework of the E-Agriculture program and as part of the judicial reform. National Trade House of Hungary (Hungarian state agency for business development) has a representative office operating in Baku for the third year and carries out an active work. Our well known pharmaceutical companies are also successfully represented at the market of Azerbaijan. 

With gratitude I would like to mention a cultural and charitable activity of the Heydar Aliyev Foundation which contributed to recent completion of reconstruction of the center for people with weak eyesight, named after Laslo Batyani, in Budapest.  As a token of gratitude, Hungarian Prime Minister Viktor Orban presented a high state award to President of the Foundation Mehriban Aliyeva.

Within the framework of the higher education program Stipendium Hungaricum the Hungarian government has allocated 200 free vacancies for Azerbaijani scholarship holders envisaging study of Azerbaijani students at different Hungarian higher education institutions. There are 55 Azerbaijani citizens who are currently taking part in the program and whose number will considerably increase in the new semester. A faculty of the Hungarian language has been opened in the Azerbaijan University of Foreign Languages and operating successfully. Budapest Semmelweis Medical University as well as Kaposvar Agrarian University took initiative to participate in the educational reform of Azerbaijan.

As far as recent events are concerned, I would like to remind that an exhibition “Hungarian orientalists” has been opened under the assistance of the Azerbaijan National Academy of Science. On May 3, Baku hosted a brillian concern of the Budapest Chamber Orchestra named after Ferenc Lizst. Our embassy has already started preparing for the jubilee concern of the well-known Hungarian composer Bel Bartok.



CE: In his interview with Caspian Energy, EU’s Ambassador to RF Mr. Vigaudas Ushatskas has said that sanctions imposed by Russia on EU are incommensurably heavier than those of EU imposed on Russia. Does it mean that you suffer more from Russian sanctions?

Imre Laszlóczki: We suffering from sanctions in general.We are suffering from sanctions imposed by Russia on EU and also from those imposed by us on Russia. Of course there are very strong reasons for introducing of sanctions against Russia and unfortunately they turned out the only tool that was possible to apply. Another case is that Hungary finds these sanctions not effective enough and therefore we should think about the way how to get them canceled soon. This is our stance for now.


Energy securitychallenge number one


CE: What role will the Southern Gas Corridor play in the energy security of Hungary?

Imre Laszlóczki: Energy security is a challenge number 1 for Hungary. We are importing 53% of our energy resources. Besides, 80% of consumed gas is supplied from Russia. In this regard, Hungary aspires to diversify sources of supply and take interest in reception of gas from the southern direction as well. We hope that we will be able to receive gas via the interconnectors. Very many countries count on this gas, but the essence of the Southern Gas Corridor lies in the possibility of transporting of Iranian and Central Asian gas vie it in future. SGC is of great importance gained owing to Azerbaijan which initiated this big project and will supply it with Shah Deniz II gas. Not only Hungary but also all countries of Europe, interested in diversification of their sources of supply, value this.


CE: What new energy projects and interconnectors will be built in Hungary within the framework of the New Energy Union of the EU?

Imre Laszlóczki: Hungary’s energy security is quite vulnerable. Considering this circumstance as well as recent negative changes in the field of transportation of energy resources (suspension of the South Stream project, long-lasting crisis in Ukraine, uncertainty of the future of the Turkish Stream project), Hungary is actively seeking ways to diversify sources of energy resources. Supplies of gas from southern directions would be the fullest diversification for Hungary both in terms of sources and routes. This is why we are considering the Southern Gas Corridor as a priority direction from where Azerbaijani gas will start flowing to Europe starting from 2019.

There are several options for now, but the most probably alternative of linking Hungary to the Southern Gas Corridor is a connection to IGB pipeline (Interconnector Greece-Bulgaria). As a continuation of the IBG route, creation of the Bulgarian-Romanian-Hungarian-Austrian gas corridor by means of relevant interconnectors, supported by the European Commission, is currently under consideration.

In addition to the abovementioned, development of the North-South energy corridor, aimed at one-sided reduction of import dependence, is also a priority for us. Hungary is very interested in development of the infrastructure via the southern part of this corridor, especially in construction of the LNG terminal in Croatia. Hungary-Slovakia interconnector was built in the north part of this route as early as 2015.

The common principle of the Hungarian energy diplomacy is to ensure the highest degree of diversification of gas supplies as well as a developed and free access to liquefied gas. We believe that rapidly developing LNG market is a real alternative for global natural gas trade. I would like to note that Hungary, as a project participant, is still committed to the implementation of the AGRI project which also based on Azerbaijani sources of natural gas.


There have been no significant mutual investments yet…


CE: How do you assess an investment climate for Hungarian investors in Azerbaijan?

Imre Laszlóczki: Hungary highly values ambitions of both Hungarian and Azerbaijani side to encourage mutual investments in our countries. We have a lot of work to do here because there have been no significant mutual investments yet except for authorized capital stock of several joint ventures. However, two profiled agencies AZPROMO and HIPA have an agreement about cooperation and exchange of project information. From our side, the most promising area for Hungarian investments are ICT, Agrarian and Service sectors. I would like to say that the Hungarian government promotes these processes since the Hungarian Exim Bank provided a credit worth over 200 mln dollars for Azerbaijan to finance joint projects. Creation of the joint ICT foundation for joint project financing is another Hungarian initiative.

Regarding the investment climate of Azerbaijan, I think that it is improving year by year, which is confirmed by international ratings of the country as well. Azerbaijan certainly meets such main investment criteria as political and macroeconomic stability, low rate of debt and developing infrastructure. The country would not be able to take out a loan worth over $200,000 without these conditions.

Dynamic development of transport and industrial infrastructure, improvement of business environment is evident. I can personally confirm that Baku has succeeded as the world level capital where also a foreigner enjoys living.

I am impressed by a number of measures taken in 2016 and aimed at supporting small and medium businesses, encouraging external and internal investments for development of regions and strengthening export potential. I find it important to create industrial parks and blocks as well as an initiative to create a free economic zone in Alyat.

Of course, not everything goes brilliant in the field of business as there is still a monopoly observed in trade and industry, problems in the customs field, bureaucracy in government agencies, variability of legal procedures. Noteworthy is also the shutdown of exchanges which causes discomfort for tourists. In general, I think the development of the investment and business environment is a long process, long way and Azerbaijan has already passed the considerable part of it.



CE: What have been the results of recent visit of the Hungarian delegation headed by Prime Minister Viktor Orban? Which tasks were solved?

Imre Laszlóczki: Our leaders have established a trust-based relations. Hungarian-Azerbaijani cooperation bears a strategic character. This is evidenced by the signing of the agreement about strategic partnership in the course of the visit of President Ilham Aliyev in 2014. Afterwards, high level visits became more frequent. During Prime Minister Viktor Orban’s visit held on March 5-6, the parties agreed that they would hold annual meetings and share opinions. 

Areas, in which we shall expand our cooperation, is of great importance. The heads of our countries highlighted the following areas: ICT sector, agriculture and food industry, infrastructure projects, water industry and ecology, and of course energy. I would also like to add tourism which is a special type of export of services with a humanitarian and cultural feature.

In the course of the Baku visit of the Hungarian Prime Minister, signed were documents about cooperation in the field of ICT technologies and labor protection as well as memorandums between Hungary and Azerbaijan. A large group of Hungarian businessmen (over 50 companies) accompanied the Prime Minister during the visit, who held quite successful negotiations in Baku, which ended up with signing of several memoranda and contracts.


Era of Finding of Homeland


CE: Hungary has a big potential for historical tourism. What opportunities do you see in this sector?

Imre Laszlóczki: Hungarian tribes came to the Carpathian Basin in the 9th century. We call this process an era of “Finding of Homeland”. According to historical terms, “100 years later Holy Ishtvan, our first king, founded a Christian State which means that our statehood is more than 1000 years old.  Over this long period the history marks sufficient amount of turns in the life of the Hungarian, which is evidenced by numerous historical monuments in the country. These monuments are nowadays sites for visit of tourists. Proceeding from our common cultural and historical legacies with the Azerbaijanis, first I would mention the biggest historical-cultural event of Europe: so called “Gurultay”. It is essentially an ethnic festival attended by over 20 peoples with a Turkic and Hunnish consciousness. But I don’t like this name either because Gurultay is something bigger than simply an ethnic festival. It is an assembly of hundreds of thousands of pilgrims of Turkic history, including members of communities for preservation of historical traditions, as well as people and tourists showing interest in our ancient history. This event is organized in every 2 years. Apart from Turkey, Kazakhstan, Kyrgyzstan and other countries, Azerbaijan is also usually represented by a big official delegation, cultural, music and folk groups. The event is so popular that within two days of 2012 it fell into the Guinness Book of World Record in terms of the amount of visitors. This year, as far as I know, this event is planned to be held at traditional place Bugaz (150km away from Budapest) on August 12-14 and organizers expect over 200,000 visitors to attend the event (


Apart from this, you can visit many historical monuments in Budapest:

  • Square of Heroes,  Buday fortress (both referred as global heritage of UNESCO);
  • Hungarian Parliament Building  (end of the 19th century);
  • National Museum  (beginning of the 19th century);
  • One can find 7 Turkish Baths (16-17th centuries) in Budapest most of which are still functioning.


CE: New prospects of cooperation emerge with the opening of low-cost air flights. Which tasks have to be solved for increasing the flow of tourists?

Imre Laszlóczki: Wizz Air company has resumed flights between Budapest and Baku since March 27, 2016 and makes flights from Baku twice a week on Mondays and Thursdays. It is indeed a new opportunities in terms of development of the mass tourism and business relations, provides students a real opportunity to see their families and promotes better communication between our peoples. I am glad that the number of Hungarian tourists visiting your beautiful country is getting higher and higher. Tickets’ being cheap indeed means that the amount of people in Azerbaijan who can make a voyage to Europe has increased. Broad network of Wizz Air-а (67 directions in Europe alone, from Budapest) provides comfortable, fast and cheap departures to other cities of Europe. We can offer various types of leisure for those who choose Hungary. Apart from city tours and hig-class SPA programs and hydropathic establishments, we offer unique programs. Budapest is one of the cultural centers of Europe. In summer the country hosts festivals, culture days, interesting fairs in different cities and regions on a daily basis. Tour-operators also offer so called combined tours as Budapest-Vienna, or Bupaest-Vienna-Bratislava. Azerbaijani tourists can visit 3 European cities in two days thanks to these tours.

From our side, I mean the embassy, we are trying to handle challenges arising from the increased flow of tourists: we doubled the capacity of the visa department of the embassy, provided an opportunity for online registration and opened a Hungarian visa center in Dalga Plaza in January 2016.



Thank you for the interview



Interview made by Sabina Mammadova, Emil Mammadov


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