Five decades of partnership

This year, Canada and Hungary has recently celebrated the 50th anniversary of diplomatic relations. On this occasion, Diplomacy & Trade featured a special focus with an interview in it with the Canadian Ambassador to Hungary, Lisa Helfand.

Lisa Helfand presented her credentials on October 1, 2013 to the Hungarian President. “When I arrived, my objectives were to get to know my embassy team, to find out as much as I could about the country and to develop a network. A year on, I am very much focused on increasing the commercial ties between Canada and Hungary,” she points out.

50th anniversary

Ambassador Helfand looks back at the past five decades by saying that “early links between our countries were based on people, the immigrants who took the brave step of moving from Hungary to Canada, including the many individuals who came to my country after the 1956 Revolution. The establishment of diplomatic relations in 1964, allowed our two countries to become closer at an institutional and commercial level, although there were obvious constraints on the relationship at the time. Following the regime change in 1989 and the end of the Cold War, the relationship started moving to a whole new level. Today, we cooperate in international organizations and are strengthening our commercial relations through the Canada-EU Comprehensive Economic and Trade Agreement. Where there were once Cold War restrictions on free movement, our citizens now enjoy visa-free travel.”

She holds the view that political relations between the two countries are in good shape. In October 2014, the Hungarian Minister of Foreign Affairs and Trade met his Canadian counterpart in Ottawa and the same month, the Speaker of Canada’s Senate “had a very successful visit to Hungary.”

The Ambassador adds that “when our diplomatic relations were established in 1964, we could hardly imagine that our countries would one day respond to common security challenges as NATO allies. We are committed to a common set of values and principles as members of the Organization for Security and Cooperation in Europe (OSCE). We cooperate at the United Nations and take part in common projects, such as preparing for the February consultations in Budapest leading to the upcoming World Humanitarian Summit.”

When asked about the Embassy’s major partners in Hungary, the Ambassador first mentions the Canadian Chamber of Commerce in Hungary, “which is deeply involved in strengthening trade and investment ties between our two countries.  There is an active network of Hungarian scholars in the field of Canadian studies who promote understanding and appreciation of Canada.  We also work with members of the Hungarian Canadian diaspora, who are involved in commercial and educational projects in Hungary and the parliamentary friendship associations in both countries.”

Economic ties

Economic relations between Canada and Hungary, says Ambassador Helfand, are in good condition and poised for continued growth which will be aided by implementation of the Canada-EU Comprehensive Economic and Trade Agreement (CETA). Trade remains at relatively modest levels with two-way merchandise trade between Canada and Hungary at USD 578.3 million in 2013, including an all-time high of USD 431 million of imports from Hungary.

The main Canadian exports to Hungary in 2013 were electrical equipment, , machinery,  vehicles, scientific and technical equipment, and printed books. Canada's main imports from Hungary were in the same categories in addition to pharmaceutical products and other equipment.

“While overall trade levels have been trending slightly downwards, improving economic conditions in both countries and the implementation of CETA should pave the way for a return to more robust bilateral trade and opportunities for sustained growth,” Ambassador Helfand points out.

Significant investments – more predictability needed

In terms of investment, Hungary remains an important destination for Canadian investment with more than USD 11 billion invested in the country and ranks as the 12th largest market for Canadian Direct Investment Abroad.  The most recent investment has been in the expansion of existing facilities in the manufacturing and agricultural sectors.  Hungarian investment in Canada, remains modest at less than USD 1 million, however, she believes it is possible that these figures are under-reported.

Canadian investment in Hungary is concentrated in the manufacturing and agricultural sectors. Canada’s top two auto parts manufacturers, Linamar and Magna, are well established in Hungary with manufacturing plants in Orosháza (SE Hungary) and Helvécia (near Kecskemét in south-central Hungary), respectively, and both have plans for further expansion in this growing sector.

Linamar has also recently signed a Strategic Partnership Agreement with the Hungarian Government. Bombardier Transportation also maintains a large and recently expanded facility in Mátranovák, NE Hungary, which manufactures and re-furbishes train bogie assemblies for export to Bombardier plants throughout Europe. All three companies provide thousands of jobs in Hungary and are important economic anchors in their respective communities.

In the agricultural sector, Semex, Canada’s top producer in bovine genetics and a global leader in its field, has its European headquarters in Mezõhegyes (near Szeged, in the south-east of the country), which has been the center of animal husbandry in Hungary for more than 200 years.

Ambassador Helfand points out that Canada’s top investors in Hungary have enjoyed success here in what has become an important production hub for exports and all have taken steps to expand their operations here. “With a focus in the manufacturing and agricultural spheres, these companies have benefited from a variety of measures to spur growth in these sectors and have been shielded from the more challenging environment faced by companies in the services and retail sectors.  Like all foreign investors, Canadian companies in Hungary would welcome a more predictable business, tax and regulatory environment to ensure greater security and facilitate long-term planning and opportunities for continued growth.”

Cultural and civil ties

The Canadian Embassy in Budapest works to strengthen cultural relations that – the Ambassador says – are strong and self-sustaining. In 2014, they supported performances in the Hungarian capital by pianist Lisa Yui and by the Artists of the Royal Conservatory (ARC) Ensemble.  The Embassy helps bring Canadian films to Hungary, and contributes to the annual Francophonie Festival in Budapest. Hungary has been visited by many world-renowned Canadian performers and groups, including Cirque du Soleil, Diana Krall and Michael Bublé.

Bilateral relations are also fostered by the Hungarian diaspora. There are over 300,000 Canadians of Hungarian descent.  Many of these people contribute in many different and helpful ways.  Some diaspora members are leading members of the business community, such as Frank Hasenfratz, the founder of Linamar. The Canadian Rákóczi Foundation supports the ‘Students Without Borders’ program to bring together young people from the region. Canadians of Hungarian origin are also a source of advice and insight for the Embassy, and some have even put their skills to use as Embassy employees and interns.

Lisa Helfand says she has travelled outside Budapest over the past year, “but not as much as I would have liked.  This is something I hope to remedy in 2015.  I am accredited to Slovenia and Bosnia and Herzegovina, as well as Hungary, so have spent time in those countries as well. In September, I went to Debrecen to celebrate the 30th anniversary of Canadian studies at the wonderful university there and to hold a business forum.”

She says one of her most enjoyable trips was going by boat to Visegrád in the Danube Bend, north of Budapest. “Then, I walked up to the renovated castle to enjoy the beautiful view from there.” As regards other enjoyments for her in Hungary, the word ‘cukrászda’ (confectionary shop) is mentioned. “One of my original ambitions was to visit all the cukrászda in Budapest but I have to admit that’s an impossible task, so I just visit the best ones.