Edit InotaiBudapestBIRNMay 26, 202315:04The 17 million euros of new grants to the Serb-dominated entity is part of the 35-million-euro package announced last summer.
Hungarian Minister of Foreign Affairs and Trade Peter Szijjarto (R) receives Bosnian Minister of Foreign Trade and Economic Relations in his office in Budapest, Hungary, 26 May 2023. EPA-EFE/NOEMI BRUZAK
Hungary has announced another 17 million euros of economic grants for the Serb-dominated Republika Srpska entity of Bosnia and Herzegovina, part of the 35-million-euro grant package announced last summer.
“In the beginning of June, another 17 million euros will be made available for farmers buying Hungarian farm machinery,” Hungarian Foreign Minister Peter Szijjarto said after meeting with Sasa Kosarac, trade minister for Bosnia and Herzegovina, on Friday in Budapest.
Szijjarto recalled that 11 million euros have already been distributed among 768 farmers and local businesses in Republika Srpska.
The Hungarian government is proving especially generous to Bosnia’s Serb-dominated entity, whose leader Milorad Dodik is regarded as a close ally of Hungary’s nationalist-populist prime minister, Viktor Orban. Late last year, Hungary’s state-owned Eximbank provided a vital loan of 110 million euros to Republika Srpska to stave off bankruptcy. Finance Minister Zora Vitkovic admitted at the time that “now there will be no problem repaying already existing loans”.
In 2021, on a visit to Banja Luka, Orban offered 100 million euros of Hungarian taxpayer money to Dodik, which caught even his own administration by surprise. It took the Foreign Ministry half a year to work out the details. Finally, Szijjarto announced the scheme of a non-returnable grant amounting to 35 million euros in July 2022. Nothing is known about the rest of the money that was promised.
There is speculation that in return Hungarian investors are gaining access to Republika Srpska’s energy companies. In August 2022, the Hungarian company Lugos Renewables admitted that Elektroprivreda RS, the major electricity company in Republika Srpska, had sold it 70 per cent of the region’s largest solar power project in Trebinje without a tender. The sale took place after Orban’s November 2021 visit to Banja Luka.
In political terms, Orban also pledged his support for Dodik ahead of the elections in Bosnia last year and he has repeatedly threatened to block any EU sanctions against Banja Luka due to Dodik’s separatist policies.
At Friday’s press conference, Szijjarto underlined once again Hungary’s firm support for the Western Balkans’s EU accession and warned that delays in the process could lead to instability in the region.
“Peace and stability in the Western Balkans is in Hungary’s national security interest,” Szijjarto said, “and the best way to achieve this is with EU integration and economic development.”
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