Hungary under pressure to pick sides in Russia-EU standoff

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Budapest (AFP) - Hungary's maverick Prime Minister Viktor Orban has spent the past year straddling the divide between Russia and his European Union counterparts on the crisis in Ukraine.

But he may soon be forced to pick sides.

On Monday, German Chancellor Angela Merkel is set to visit Budapest for the first time since Orban came to power five years ago. Ukraine is expected to feature prominently in talks between the two leaders.

Two weeks later it will be Russian President Vladimir Putin's turn to have a word in Orban's ear -- one that is unlikely to chime with that of Merkel.

Hungary joined the EU in 2004 but under Orban the former communist country has begun pulling away from Brussels and moving closer to Moscow.

A quarter of a century after he shot to prominence in protests during the final days of communism, Orban is now considered as one of Putin's closest European allies.

"Orban has manoeuvred Hungary into international isolation, a diplomatic no-man's land," said Andras Biro-Nagy, co-director of the Policy Solutions Institute.

"The consensus on strategic commitment towards the West no longer exists in Hungary," Biro-Nagy told AFP.

Merkel will be one of the few Western leaders to have visited the nationalist premier, who cited Russia last year as an example of the kind of "illiberal" democracy he envisaged in Hungary, fuelling allegations of his creeping authoritarianism.

Slow to condemn Russia's annexation of the Crimea peninsula from Ukraine, Orban nonetheless supported EU sanctions against Russia -- but he has also voiced unease about them.

Last year, he said that the bloc had "shot itself in the foot" by damaging commercial relations with Moscow.

In a sign of growing alarm over Orban in Washington, President Obama last year included Hungary on a blacklist of countries harassing foreign-funded civil groups.

The US also banned six Hungarian officials, including the head of the national tax office, from entering the US, for alleged corruption.

A furious Orban ordered the US to stop "meddling" in central Europe.

- Eastern Opening -

"How to deal with EU member Hungary is a difficult test case for both Brussels and Berlin," Peter Balazs, left-wing foreign minister between 2009 and 2010, told AFP.

Balazs labels as "dubious" some of the deals Hungary has struck with Putin as part of Orban's "Eastern Opening" policy.

Last year, he signed a 10-billion-euro ($12-billion) loan deal with the Kremlin to expand Hungary's sole nuclear plant.

Orban also changed laws to smooth the way for Moscow's South Stream gas pipeline project - which was later cancelled by Putin -- to bypass Ukraine en route to Hungary, which relies heavily on Russian gas.

Then, just before winter, Orban switched off reverse gas flows to Ukraine for three months, claiming he needed to top up domestic reserves.

As the fighting between government forces and pro-Russian rebels in eastern Ukraine intensifies, triggering around round of EU sanctions on Russia this week, analysts expects Merkel to press Orban to toe the EU line.

"She's trying to keep EU unanimity vis-a-vis Russia, but it is more difficult with premiers like Orban seemingly on Putin's side," Csaba Toth, analyst at the Republikon Institute, a Budapest think tank, said.

If any European country can keep Orban looking westward it's Germany.

Europe's biggest economy is Hungary's biggest trading partner by a long shot. Furthermore, Merkel's Christian Democrats are in the same centre-right grouping in the European Parliament as Orban's Fidesz.

And if Hungary's economy is doing well, it is partly thanks to the approximately 6,000 German firms that provide jobs for around 300,000 people, including carmakers Audi and Daimler.

Merkel is not expected to publicly rebuke her host in Budapest, although Berlin sources have hinted she may openly criticise his recent remarks urging strict curbs on immigration.

"Besides managing Ukraine and Russia, and the fallout from last Sunday's Greek election, Merkel does not want to waste political resources on disciplining a small EU member state," says Daniel Hegedus, an analyst with the Berlin-based German Council on Foreign Relations.

But, behind closed doors, Hegedus says her message will be clear.

"Securing energy security is one thing, but Hungary should not weaken the EU's and Berlin's position on Ukraine, and should not become Russia's Trojan horse inside the EU".

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