Working to Bridge Differences

As European Union member states, the Netherlands and Hungary work closely on a wide range of issues that call for even more intensive dialogue. As NATO allies and EU partners, the two countries share the same values and have common interests – from promoting economic, military and political cooperation and working on a circular economy to the digital internal market.

Ties between the Netherlands and Hungary reach back centuries and both countries are members of international organizations, which foments even closer relations. ‘’Our country is open, inclusive and inventive, we work with many stakeholders, including civil society on these issues because we think it helps create a prosperous country,” René van Hell says. “The two pillars of my work are to foster European integration and strengthen bilateral economic ties. I hope that I can make a modest contribution to assist our countries in mitigating challenges such as climate change, cyber security, water supply problems and future refugee crises. The good relationship and open and frank dialogue were also underlined during the visit last year of President János Áder to the Netherlands where he met the King and this year’s visits by Minister of Justice Ferdinand Grapperhaus and Minister of Foreign Affairs Stef Blok to Hungary,’’ Van Hell underlines.

“Working together within the framework of the EU also allows for differences of opinion,” highlights René van Hell, adding that the debate on migration is at times quite vocal. Countries need to differentiate between economic migrants from outside the EU and refugees or asylum seekers. Hungary and the Netherlands agree that Europe needs stronger external borders and that the EU has to tackle the problems at the source and stop human trafficking. “Our official stance in this matter is that we need European solidarity on refugees. It is also important to continue our dialogue on the rule of law, application of EU legal principles and the position of civil society,” the Ambassador notes. “Climate change is an existential problem and it’s going to be one of the root causes of migration if we don’t do anything about it. We need to find solutions for feeding this planet together, and the Netherlands, being the second biggest exporter of agricultural goods in the world, thinks that cooperation with Hungary, where agriculture is also a key sector, is very important,” the Ambassador elaborates.

Flourishing economic relations

Bilateral relations between the Netherlands and Hungary are strong, diverse and more vibrant than ever before. There are over 800 Dutch companies operating in Hungary, including international giants like Heineken, Philips, KLM or FrieslandCampina and a plethora of SMEs and family businesses, covering the entire spectrum of the economy. ‘’This variety makes economic ties especially strong and healthy, with bilateral trade amounting to EUR seven billion,’’ Van Hell emphasises. With a total of EUR 12 billion in foreign direct investment inflows from the Netherlands since the early 1990s, the Benelux country ranks among the largest investors in Hungary. “I definitely don’t see a dwindling interest in the country from investors’ side, but growth in capital inflows is a little bit more modest than compared to the 1990s when there was a boom. Dutch enterprises are investing in the quality of their operations here, certain companies use Hungary to test innovations or to explore new opportunities,” the Ambassador notes. Economic competitiveness in general is essential to attract foreign investors and promote domestic entrepreneurs. “Education plays a crucial role in this process; the Netherlands, for instance, is one of the few countries in Europe where entrepreneurship is stimulated at high school level,” Van Hell notes.

Labor market

Hungary’s tight labor market compels Dutch companies to invest heavily in rationalization and the improvement of their productivity, which results in efficiency levels that are among the highest in the world. “I see some greenfield investments coming in from the Netherlands, but the majority of companies present on the market are continuously reinvesting in processes and maintaining capacity,” René van Hell says. The scarcity of available skilled labor is raising concerns among foreign investors and Dutch ventures are no exception. In addition to optimizing their operations, Dutch companies are retaining their workforce through employer branding, education opportunities and by creating an inclusive working environment. Labor market tightness is a Europe-wide phenomenon and the Netherlands is tackling the issue by trying to integrate partially active or non-active groups into the labor market and offering the possibility to work beyond the official retirement age. “In some specific sectors, like health care, we are recruiting workers from other EU countries. With respect to labor mobility outside the EU, we have programs to attract knowledge workers from non-EU countries, following strict regulations’’ the Ambassador says.

Agricultural cooperation

Agriculture is one of the specific economic sectors where the embassy fosters bilateral cooperation. “The natural circumstances for agriculture in Hungary are very positive, such as the country’s geographical location and its fertile soil. However, the opportunities are not yet fully used,’’ the Ambassador remarks. “For example, Hungary is importing fruit and vegetables, whereas it could grow more locally. We can do much more in terms of cooperation in the area of agriculture, where Dutch expertise and knowledge could stimulate the modernization of the animal husbandry sector, like the pig sector. Innovation, cooperation and competitiveness within the agricultural sector could be further stimulated,” Van Hell says. The Netherlands is a hotbed of agri-food research with some 12 out of the 40 largest global food & beverage companies operating R&D facilities there. Regional initiatives like Food Valley and Brainport Foodtech support SMEs with the implementation of promising innovations. “I see ambition on the part of the Hungarian Ministry of Agriculture to carry out reforms in the sector and in general to have more value-added production, moving from the notion ‘Made in Hungary’ to ‘Invented in Hungary’. More competition, welcoming foreign farmers to do business here, setting up cooperatives and cooperation between top-notch research institutes, the government and the sector itself are key in raising productivity,” the Ambassador notes.

The economy of the future

According to the Global Innovation Index 2018, the Netherlands is the second most innovative country in the world after Switzerland. The Dutch government strongly supports the deployment of innovations in building a circular economy for long-term sustainability. ‘’My country has set a big, audacious goal of being 100% waste free by 2050 and 50% by 2030,’’ the Ambassador says. To achieve this, the Netherlands has set up national circular transition agendas for a wide range of industrial sectors, including consumer goods, plastics and construction. ‘’As a local initiative, our embassy, together with the Business Council for Sustainable Development in Hungary and the Ministry of Innovation and Technology established the Circular Economy Platform last November,’’ the Ambassador explains. With over 70 members by now, it has been set up with the aim to share knowledge and to speed up the transition to circularity by closing the loops.

Historical ties

The relationship between the two countries, which established diplomatic relations in 1920, dates back centuries. A good example of the shared history is Maria van Hongarije (1505–1558), the wife of King Louis II, who was queen consort of Hungary and Bohemia and Governor of the Netherlands. Dutch admiral Michiel de Ruyter rescuing 26 Hungarian Protestant preachers from galley slavery in Naples in 1676 was also a memorable moment in history. During the Counter-Reformation, numerous Hungarian students went to study in the Netherlands at universities in Franeker, Utrecht, Groningen and Leiden. Following World War I, many 'children-trains' traveled from Hungary to the Netherlands, carrying some 28,000 displaced, orphaned and undernourished children between 1920 and 1930 to vacation in the western European country. Numerous personal contacts developed between the receiving families in Holland and the families of the children in Hungary. “These trains are very tangible symbols of DutchHungarian cooperation between citizens,” the Ambassador notes. During the weeks of the 1956 uprising in Hungary, Dutch people expressed their solidarity by holding demonstrations in Amsterdam, Utrecht and The Hague. When the freedom fight was defeated, locals in Amsterdam renamed a main street in the city center as Vrijheidslaan (Liberty Street). ‘’We can build upon our centuries-old relationship and our modern-time cooperation in the European Union; we are in this together for the long haul. I am convinced that there are great opportunities ahead of us in this fortunately peaceful and democratic place: Europe, our common home,’’ the Ambassador concludes.