Peter Magyar

Published on
14/04/2026 – 15:39 GMT+2

Viktor Orbán has positioned Hungary as a European centre for Chinese electric vehicle manufacturers, while disregarding the EU’s tariffs on them.

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Now his political successor, Péter Magyar, appears less inclined to reverse that policy in a radical way.

At a press conference on Monday following a landslide victory against Orbán, Magyar praised China as “one of the most important, largest, and strongest countries in the world.”

“I am very happy to travel to Beijing, and we are very happy to welcome Chinese leaders here in Hungary,” he added.

Magyar also said he would “review” Chinese investments in Hungary – particularly on electric vehicles – but “not with the aim of shutting them down or preventing them from happening.”

In recent years, Hungary was eager to attract Beijing’s largeness, with BYD building its first European passenger EV factory in Szeged in 2024 and major firms such as CATL, NIO and EVE Energy investing heavily in the country.

But that open-door policy has increasingly clashed with the EU’s push to tighten scrutiny of Chinese investments, as China floods Europe with low-cost imports and as many as 600,000 job losses are projected in the EU in the bloc’s auto sector this decade amid intensifying competition from Chinese manufacturers.

Magyar will also have to deal with concerns over alleged forced labour involving Chinese workers at Hungarian plants of EV giant BYD, as well as a recent European Commission probe into unfair subsidies at the same site. Those developments have tarnished the company’s reputation and raised concerns over Beijing’s investments.

Driving more value from investment in Hungary

At his press conference on Monday, the leader of Hungary’s Tisza party did not enter details. But he made clear that Hungary would align its policy more closely with Brussels.

“Rather, the goal is to ensure that those projects comply with European Union and Hungarian environmental regulations, health procedures, and labour safety standards, and contribute to the performance of the Hungarian national economy,” Magyar added.

He also appeared determine to distance himself from Orbán’s wariness of a recent European Commission proposal on “Made in Europe,” which targets China.

The draft law, currently discussed by EU governments and MEPs, would impose stricter conditions on foreign direct investment above €100 million in sectors such as batteries, electric vehicles, solar panels and critical raw materials.

Under the proposal, investors from countries holding 40% of global market share in a given sector would be required to hire at least 50% of EU workers. Additional conditions could include foreign ownership caps below 49%, joint ventures with European partners and technology transfers.

“What we do not want — and will not accept — is for foreign companies to come, receive significant Hungarian state support, employ very few Hungarians, create little to no added value for the Hungarian economy, and at the same time endanger the quality of Hungary’s land, air, and water,” Magyar added, signalling his intention to align policy more closely with Brussels.

The Budapest Stock Exchange jumped over 3% to a record high of more than 136,000 points on Monday as markets priced in the end of 16 years of Viktor Orbán’s time in power and the potential return of Hungary to a more mainstream European path.

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Increased investor appetite pushed the country’s largest listed companies, including OTP Bank, MOL, Richter, and Magyar Telekom to gain between 2%-5% by 1 p.m. CET.

The move contrasts with broader European markets, which are trading lower, digesting the failure of US-Iran negotiations over the weekend with no indication of further talks.

At the election on Sunday, Péter Magyar’s Tisza party secured 138 seats in the 199-seat Hungarian parliament, securing a supermajority and fuelling expectations of a seismic shift in the country’s politics.

Magyar, a former Orbán ally turned fierce critic, has promised to restore democratic checks and balances and unlock €17 billion in EU funds frozen over democratic backsliding under Orbán’s government.

This could be accompanied by access to low-cost loans for defence and infrastructure, fuelling the fragile growth of the Hungarian economy.

Speaking to Euronews, Timothy Ash, a senior emerging markets strategist at RBC Global Asset Management, explained that “the market is reacting to a combination of uncertainty dissipating, as there was a real concern of election results being contested, and renewed optimism for policy changes that should align Europe”.

“Magyar will need better relations with the EU. There are lots of structural funds that will probably get released, and the market knows the economic policy team well,” he added.

Ash also said that the likely pick of András Kármán as the new finance minister, “a very credible person,” will further stabilise the country’s near-term growth.

Kármán is currently Tisza’s economic advisor and previously served as a member of the board of directors at the European Bank for Reconstruction and Development (EBRD).

Investors appear to view the result as removing a long-standing political risk premium that had weighed on Hungarian assets.

The two-thirds parliamentary majority secured by Tisza will allow swift legislative changes, including the potential removal of sector-specific windfall taxes that had squeezed banks, energy firms and retailers.

Morgan Stanley and other analysts have noted that such a shift could lift Hungary’s GDP growth potential by 1 to 1.5% in the coming years through higher investment and restored EU transfers.

Hungarian currency strengthens on reform optimism

The Hungarian currency joined the rally, climbing to its strongest level against the euro in more than four years.

The EUR/HUF rate fell to 366.64, its lowest since April 2022, while the forint also gained sharply against the US dollar.

Market observers attribute the currency’s strength to expectations of reduced political uncertainty and renewed foreign capital inflows once EU funds resume.

However, Ash explained to Euronews that “Hungary has a very high real rate compared to, say, Poland. I think the central bank has maintained very high real rates because of political risk”.

“They were very concerned about maybe the currency weakening around elections, but are very eager to have a stable currency.”

Last month, the National Bank of Hungary held its benchmark rate at 6.25%, whereas in Poland, for example, it is currently steady at 3.75%.

“Maybe we’ll see a normalisation of real rates in Hungary towards [those closer to] Poland, and that means rate cuts, probably. Investors will likely focus on rates more than the currency as Hungary will also need economic stimulus to catalyse growth,” Ash added.