Hungary vs. Ukraine

Ukraine was the center of the first eastern Slavic state, Kyivan Rus, which during the 10th and 11th centuries was the largest and most powerful state in Europe. Weakened by internecine quarrels and Mongol invasions, Kyivan Rus was incorporated into the Grand Duchy of Lithuania and eventually into the Polish-Lithuanian Commonwealth. The cultural and religious legacy of Kyivan Rus laid the foundation for Ukrainian nationalism through subsequent centuries. A new Ukrainian state, the Cossack Hetmanate, was established during the mid-17th century after an uprising against the Poles. Despite continuous Muscovite pressure, the Hetmanate managed to remain autonomous for well over 100 years. During the latter part of the 18th century, most Ukrainian ethnographic territory was absorbed by the Russian Empire. Following the collapse of czarist Russia in 1917, Ukraine achieved a short-lived period of independence (1917-20), but was reconquered and endured a brutal Soviet rule that engineered two forced famines (1921-22 and 1932-33) in which over 8 million died. In World War II, German and Soviet armies were responsible for 7 to 8 million more deaths. Although Ukraine achieved independence in 1991 with the dissolution of the USSR, democracy and prosperity remained elusive as the legacy of state control and endemic corruption stalled efforts at economic reform, privatization, and civil liberties.

A peaceful mass protest referred to as the "Orange Revolution" in the closing months of 2004 forced the authorities to overturn a rigged presidential election and to allow a new internationally monitored vote that swept into power a reformist slate under Viktor YUSHCHENKO. Subsequent internal squabbles in the YUSHCHENKO camp allowed his rival Viktor YANUKOVYCH to stage a comeback in parliamentary (Rada) elections, become prime minister in August 2006, and be elected president in February 2010. In October 2012, Ukraine held Rada elections, widely criticized by Western observers as flawed due to use of government resources to favor ruling party candidates, interference with media access, and harassment of opposition candidates. President YANUKOVYCH's backtracking on a trade and cooperation agreement with the EU in November 2013 - in favor of closer economic ties with Russia - and subsequent use of force against students, civil society activists, and other civilians in favor of the agreement led to a three-month protest occupation of Kyiv's central square. The government's use of violence to break up the protest camp in February 2014 led to all out pitched battles, scores of deaths, international condemnation, a failed political deal, and the president's abrupt departure for Russia. New elections in the spring allowed pro-West president Petro POROSHENKO to assume office in June 2014; he was succeeded by Volodymyr ZELENSKY in May 2019.

Shortly after YANUKOVYCH's departure in late February 2014, Russian President PUTIN ordered the invasion of Ukraine's Crimean Peninsula falsely claiming the action was to protect ethnic Russians living there. Two weeks later, a "referendum" was held regarding the integration of Crimea into the Russian Federation. The "referendum" was condemned as illegitimate by the Ukrainian Government, the EU, the US, and the UN General Assembly (UNGA). In response to Russia's illegal annexation of Crimea, 100 members of the UN passed UNGA resolution 68/262, rejecting the "referendum" as baseless and invalid and confirming the sovereignty, political independence, unity, and territorial integrity of Ukraine. In mid-2014, Russia began supplying proxies in two of Ukraine's eastern provinces with manpower, funding, and materiel driving an armed conflict with the Ukrainian Government that continues to this day. Representatives from Ukraine, Russia, and the unrecognized Russian proxy republics signed the Minsk Protocol and Memorandum in September 2014 to end the conflict. However, this agreement failed to stop the fighting or find a political solution. In a renewed attempt to alleviate ongoing clashes, leaders of Ukraine, Russia, France, and Germany negotiated a follow-on Package of Measures in February 2015 to implement the Minsk agreements. Representatives from Ukraine, Russia, the unrecognized Russian proxy republics, and the Organization for Security and Cooperation in Europe also meet regularly to facilitate implementation of the peace deal. More than 13,000 civilians have been killed or wounded as a result of the Russian intervention in eastern Ukraine.

19 counties (megyek, singular - megye), 23 cities with county rights (megyei jogu varosok, singular - megyei jogu varos), and 1 capital city (fovaros)

counties: Bacs-Kiskun, Baranya, Bekes, Borsod-Abauj-Zemplen, Csongrad-Csanad, Fejer, Gyor-Moson-Sopron, Hajdu-Bihar, Heves, Jasz-Nagykun-Szolnok, Komarom-Esztergom, Nograd, Pest, Somogy, Szabolcs-Szatmar-Bereg, Tolna, Vas, Veszprem, Zala

cities with county rights: Bekescsaba, Debrecen, Dunaujvaros, Eger, Erd, Gyor, Hodmezovasarhely, Kaposvar, Kecskemet, Miskolc, Nagykanizsa, Nyiregyhaza, Pecs, Salgotarjan, Sopron, Szeged, Szekesfehervar, Szekszard, Szolnok, Szombathely, Tatabanya, Veszprem, Zalaegerszeg

capital city: Budapest

Hungary has transitioned from a centrally planned to a market-driven economy with a per capita income approximately two thirds of the EU-28 average; however, in recent years the government has become more involved in managing the economy. Budapest has implemented unorthodox economic policies to boost household consumption and has relied on EU-funded development projects to generate growth.

Following the fall of communism in 1990, Hungary experienced a drop-off in exports and financial assistance from the former Soviet Union. Hungary embarked on a series of economic reforms, including privatization of state-owned enterprises and reduction of social spending programs, to shift from a centrally planned to a market-driven economy, and to reorient its economy towards trade with the West. These efforts helped to spur growth, attract investment, and reduce Hungary's debt burden and fiscal deficits. Despite these reforms, living conditions for the average Hungarian initially deteriorated as inflation increased and unemployment reached double digits. Conditions slowly improved over the 1990s as the reforms came to fruition and export growth accelerated. Economic policies instituted during that decade helped position Hungary to join the European Union in 2004. Hungary has not yet joined the euro-zone. Hungary suffered a historic economic contraction as a result of the global economic slowdown in 2008-09 as export demand and domestic consumption dropped, prompting it to take an IMF-EU financial assistance package.

Since 2010, the government has backpedaled on many economic reforms and taken a more populist approach towards economic management. The government has favored national industries and government-linked businesses through legislation, regulation, and public procurements. In 2011 and 2014, Hungary nationalized private pension funds, which squeezed financial service providers out of the system, but also helped Hungary curb its public debt and lower its budget deficit to below 3% of GDP, as subsequent pension contributions have been channeled into the state-managed pension fund. Hungary's public debt (at 74.5% of GDP) is still high compared to EU peers in Central Europe. Real GDP growth has been robust in the past few years due to increased EU funding, higher EU demand for Hungarian exports, and a rebound in domestic household consumption. To further boost household consumption ahead of the 2018 election, the government embarked on a six-year phased increase to minimum wages and public sector salaries, decreased taxes on foodstuffs and services, cut the personal income tax from 16% to 15%, and implemented a uniform 9% business tax for small and medium-sized enterprises and large companies. Real GDP growth slowed in 2016 due to a cyclical decrease in EU funding, but increased to 3.8% in 2017 as the government pre-financed EU funded projects ahead of the 2018 election.

Systemic economic challenges include pervasive corruption, labor shortages driven by demographic declines and migration, widespread poverty in rural areas, vulnerabilities to changes in demand for exports, and a heavy reliance on Russian energy imports.

After Russia, the Ukrainian Republic was the most important economic component of the former Soviet Union, producing about four times the output of the next-ranking republic. Its fertile black soil accounted for more than one fourth of Soviet agricultural output, and its farms provided substantial quantities of meat, milk, grain, and vegetables to other republics. Likewise, its diversified heavy industry supplied unique equipment such as large diameter pipes and vertical drilling apparatus, and raw materials to industrial and mining sites in other regions of the former USSR.

Shortly after independence in August 1991, the Ukrainian Government liberalized most prices and erected a legal framework for privatization, but widespread resistance to reform within the government and the legislature soon stalled reform efforts and led to some backtracking. Output by 1999 had fallen to less than 40% of the 1991 level. Outside institutions - particularly the IMF encouraged Ukraine to quicken the pace and scope of reforms to foster economic growth. Ukrainian Government officials eliminated most tax and customs privileges in a March 2005 budget law, bringing more economic activity out of Ukraine's large shadow economy. From 2000 until mid-2008, Ukraine's economy was buoyant despite political turmoil between the prime minister and president. The economy contracted nearly 15% in 2009, among the worst economic performances in the world. In April 2010, Ukraine negotiated a price discount on Russian gas imports in exchange for extending Russia's lease on its naval base in Crimea.

Ukraine's oligarch-dominated economy grew slowly from 2010 to 2013 but remained behind peers in the region and among Europe's poorest. After former President YANUKOVYCH fled the country during the Revolution of Dignity, Ukraine's economy fell into crisis because of Russia's annexation of Crimea, military conflict in the eastern part of the country, and a trade war with Russia, resulting in a 17% decline in GDP, inflation at nearly 60%, and dwindling foreign currency reserves. The international community began efforts to stabilize the Ukrainian economy, including a March 2014 IMF assistance package of $17.5 billion, of which Ukraine has received four disbursements, most recently in April 2017, bringing the total disbursed as of that date to approximately $8.4 billion. Ukraine has made progress on reforms designed to make the country prosperous, democratic, and transparent, including creation of a national anti-corruption agency, overhaul of the banking sector, establishment of a transparent VAT refund system, and increased transparency in government procurement. But more improvements are needed, including fighting corruption, developing capital markets, improving the business environment to attract foreign investment, privatizing state-owned enterprises, and land reform. The fifth tranche of the IMF program, valued at $1.9 billion, was delayed in mid-2017 due to lack of progress on outstanding reforms, including adjustment of gas tariffs to import parity levels and adoption of legislation establishing an independent anti-corruption court.

Russia's occupation of Crimea in March 2014 and ongoing Russian aggression in eastern Ukraine have hurt economic growth. With the loss of a major portion of Ukraine's heavy industry in Donbas and ongoing violence, the economy contracted by 6.6% in 2014 and by 9.8% in 2015, but it returned to low growth in in 2016 and 2017, reaching 2.3% and 2.0%, respectively, as key reforms took hold. Ukraine also redirected trade activity towards the EU following the implementation of a bilateral Deep and Comprehensive Free Trade Agreement, displacing Russia as its largest trading partner. A prohibition on commercial trade with separatist-controlled territories in early 2017 has not impacted Ukraine's key industrial sectors as much as expected, largely because of favorable external conditions. Ukraine returned to international debt markets in September 2017, issuing a $3 billion sovereign bond.

Ukraine's telecom market continues to face challenges resulting from the annexation of Crimea by Russia and unrest in eastern regions; developing telecom market has attracted international investors from Russia, Turkey, and Azerbaijan; government plan emphasizes improvement of domestic trunk lines, international connections, and a national mobile-cellular system; operators moving from 3G services to 4G, but some areas still use 2G; LTE services available in cities; FttP networks taking over DSL platforms; government approved plan in 2020 for 5G migration and operator is developing IoT capabilities; improvement of licensing requirements for operators and positive reforms for users; importer of broadcasting equipment from China (2021)

Ukraine's media landscape is dominated by oligarch-owned news outlets, which are often politically motivated and at odds with one another and/or the government; while polls suggest most Ukrainians still receive news from traditional media sources, social media is a crucial component of information dissemination in Ukraine; almost all Ukrainian politicians and opinion leaders communicate with the public via social media and maintain at least one social media page, if not more; this allows them direct communication with audiences, and news often breaks on Facebook or Twitter before being picked up by traditional news outlets

Ukraine television serves as the principal source of news; the largest national networks are controlled by oligarchs: TRK Ukraina is owned by Rinat Akhmetov; Studio 1+1 is owned by Ihor Kolomoyskyy; Inter is owned by Dmytro Firtash and Serhiy Lyovochkin; and StarlightMedia channels (ICTV, STB, and Novyi Kanal) are owned by Victor Pinchuk;  a set of 24-hour news channels also have clear political affiliations: 112-Ukraine and NewsOne tacitly support pro-Russian opposition and are believed to be controlled by political and business tycoon Viktor Medvedchuk; pro-Ukrainian government Channel 5 and Pryamyi are linked to President Petro Poroshenko; 24 and ZIK are owned by opposition, but not pro-Russian, politicians; UA: Suspilne is a public television station under the umbrella of the National Public Broadcasting Company of Ukraine; while it is often praised by media experts for balanced coverage, it lags in popularity; Ukrainian Radio, institutionally linked to UA: Suspilne, is one of only two national talk radio networks, with the other being the privately owned Radio NV

bilateral government, legal, technical and economic working group negotiations continue in 2006 with Slovakia over Hungary's failure to complete its portion of the Gabcikovo-Nagymaros hydroelectric dam project along the Danube; as a member state that forms part of the EU's external border, Hungary has implemented the strict Schengen border rules

1997 boundary delimitation treaty with Belarus remains unratified due to unresolved financial claims, stalling demarcation and reducing border security; delimitation of land boundary with Russia is complete and demarcation began in 2012; the dispute over the boundary between Russia and Ukraine through the Kerch Strait and Sea of Azov is suspended due to the occupation of Crimea by Russia; Ukraine and Moldova signed an agreement officially delimiting their border in 1999, but the border has not been demarcated due to Moldova's difficulties with the break-away region of Transnistria; Moldova and Ukraine operate joint customs posts to monitor transit of people and commodities through Moldova's Transnistria Region, which remains under the auspices of an Organization for Security and Cooperation in Europe-mandated peacekeeping mission comprised of Moldovan, Transnistrian, Russian, and Ukrainian troops; the ICJ ruled largely in favor of Romania in its dispute submitted in 2004 over Ukrainian-administered Zmiyinyy/Serpilor (Snake) Island and Black Sea maritime boundary delimitation; Romania opposes Ukraine's reopening of a navigation canal from the Danube border through Ukraine to the Black Sea