OMRI DAILY DIGEST
No. 168, 29 August 1995

HUNGARIAN LIBERALS THREATEN TO QUIT RULING COALITION. Hungary's Alliance
of Free Democrats (SZDSZ) is threatening to leave the ruling coalition
over a proposal to name a deputy prime minister to oversee the economy,
Radio Budapest and international agencies reported. The liberals argue
that such a post would diminish the power of Finance Minister Lajos
Bokros, whose controversial austerity package aimed at dealing with the
country's large budget deficit enjoys strong support from the SZDSZ.
Prime Minister Gyula Horn has stressed he intends to establish the post,
despite opposition from the coalition partner. He has also said he is in
favor of appointing trade union leader Sandor Nagy, who is generally
regarded as leader of the Socialist Party's left wing, which is opposed
to both the austerity package and market reforms that result in job
losses. The Socialists have a narrow majority in the parliament, but it
is unclear what the party's pro-market wing would do in the event of a
split with the SZDSZ. -- Jan Cleave, OMRI, Inc.

HUNGARIAN PARTY CALLS FOR BREAK WITH ROMANIA. International agencies on
28 August reported that Hungary's Smallholders' Party has called on the
government to break off diplomatic relations with Romania. The call came
at a weekend meeting of opposition parties in Hungary. Prime Minister
Gyula Horn, who was present at the meeting, called for a continued
dialogue and diplomatic efforts to improve relations with Romania. --
Michael Shafir, OMRI, Inc.

HUNGARIAN PARTY OF GYPSIES DEMANDS PARLIAMENTARY REPRESENTATION. Albert
Horvath, leader of the Hungarian Party of Gypsies, hand-delivered a
letter to Premier Gyula Horn demanding that the government guarantee
Gypsies parliamentary representation, MTI reported on 28 August. He said
he had to resort to delivering the letter to the Socialist Party
headquarters because he had written so many already and not received an
answer. Horvath cited constitutional paragraphs promising minorities
representation in the parliament as well as equal political and cultural
rights. He pointed out that the unemployment rate for the minority
stands at 80% and that many Gypsies earn only 6,700 forint ($55).
Without parliamentary representation, he said his party was unable to
try to make changes. Some Romani and Gypsy parties do not use the name
"Roma" in order to include those groups that do not speak Romani. --
Alaina Lemon, OMRI, Inc.

HUNGARIAN, SLOVAK PREMIERS TO DISCUSS SLOVAK LANGUAGE LAW. Gyula Horn
and Vladimir Meciar plan to meet to discuss the draft of a controversial
Slovak language law during the Central European Free Trade Agreement
meeting in the Czech town of Brno on 11 September, Hungarian media
reported on 28 August. The draft language law would require all schools,
including those predominantly or exclusively attended by members of the
Hungarian minority, to teach in the Slovak language. An estimated
600,000 ethnic Hungarians live in southern Slovakia. -- Jan Obrman,
OMRI, Inc.

MORE REFUGEES EXPECTED IN VOJVODINA . . . A peace conference in the
Hungarian town of Szeged, attended by nongovernmental representatives
from 15 countries, has expressed fears that another 70,000 Krajina Serbs
will be settled in Vojvodina, which has large Hungarian, Croatian, and
other Central European minorities, Hungarian TV1 reported on 27 August.
Meanwhile, Hina on 28 August said that 565 ethnic Croatian refugees
arrived in Croatia from Vojvodina on 28 August. The mass expulsion of
Croats and Muslims from Banja Luka and other areas in northwestern
Bosnia continued on 28 August, Croatian Radio reported. Some 300 people
crossed the River Sava from Srbac to Davor, and more refugees are
expected to arrive. -- Fabian Schmidt, OMRI, Inc.

. . . BUT MINISTER FOR MINORITIES SEES NO DIFFICULTIES. Margit Savovic,
rump Yugoslav minister without portfolio in charge of civil liberties
and minority rights, has denied that Serbian refugees in Kosovo and
Vojvodina will disturb the ethnic balance there, Tanjug reported on 27
August. Savovic charged "certain countries" with using the refugee
crisis to "interfere in Yugoslavia's internal affairs." Vjesnik on 29
August said that paramilitary troops under internationally wanted war-
criminal Zeljko Raznjatovic, alias "Arkan," have begun press-ganging
refugees in Serbia for deployment in eastern Slavonia. -- Fabian
Schmidt, OMRI, Inc.

VAN DER STOEL IN ROMANIA. Amid renewed tension in Romanian-Hungarian
interethnic relations in Transylvania, Max van der Stoel, the OSCE High
Commissioner for Ethnic minorities, began a four-day visit to Romania on
28 August, Radio Bucharest announced the same day. He met with leaders
of the Hungarian Democratic Federation of Romania and is also scheduled
to meet with Prime Minister Nicolae Vacaroiu, Chamber of Deputies
chairman Adrian Nastase, Foreign Minister Teodor Melescanu, government
coordinator of the Council for National Minorities Viorel Hrebenciuc,
and deputy justice and education ministers. Van der Stoel will also
participate in a symposium on international legislation for national
minorities. -- Michael Shafir, OMRI, Inc.

[As of 12:00 CET]

Compiled by Jan Cleave

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N E W S L E T T E R

from the Daily Bulletin of the Hungarian News Agency MTI
distributed by the Department for Press and International Information
Ministry of Foreign Affairs, Republic of Hungary

H-1394, Budapest P.O.B. 423.
Telephone: 36 (1) 156-8000
Telefax: 36 (1) 156-3801
No. 160                                                         28 August 1995


Prime Minister's Press Conference - Details

        Hungarian Prime Minister Gyula Horn held a press conference on
Friday in Budapest, at which he spoke about his meetings with the
leaders of the four parliamentary opposition parties: the Hungarian
Democratic Forum (HDF), the Christian Democratic People's Party
(CDPP), the Federation of Young Democrats - Hungarian Civic Party
(FYD-HCP), and the Independent
Smallholders" Party (ISP).

        As regards his meeting with ISP Chairman Jozsef Torgyan, the
prime minister said Torgyan handed over a long list of complaints,
which he complemented verbally, however, when asked what solutions
the ISP offered, no concrete proposals were made apart from the usual
"stirring, slogan-like" generalities.

        Horn said the leaders of the parliamentary groups of the
opposition parties had agreed to continue similar consultations, and
a six-party meeting may be held next week.

        He said it was his firm intention to hold continuous dialogue
with representatives of society, and employers and employees,
voluntary organizations and the Churches.

        As regards what was said during the meetings, Horn said he had
reported on the high-level meetings planned with the Romanian and
Slovak governments, and the Hungarian initiatives relating to the
situation of Vojvodina Hungarians.

        He said he had had a serious disagreement with ISP Chairman
Torgyan, who advocates breaking off Hungarian-Romanian diplomatic
relations because of the recent Romanian legislation on education,
which puts the Hungarian minority at a severe disadvantage.

        The prime minister said such a proposal would do more harm than
good, and could have serious consequences for the Hungarians in
Romania. Breaking off diplomatic relations was not the solution, he
said.

        With respect to the situation along the Yugoslav border, Horn
said steps are being taken that will ensure that Hungary's border
will not be crossed or her territory used for military action.
Hungary has not taken sides in the conflict and has kept out of all
the events of the war.

        Horn also discussed ways to improve the work of Parliament and
speed up legislation. The opposition politicians agreed with him that
legislation on the economy, such as the reform of the state budget
and eliminating the black economy, should receive priority in order
to resolve the economic crisis and speed up the transformation of the
economy.

        The prime minister declined to answer any questions about the
state of the coalition, citing the agreement concluded with his
coalition partners, the Alliance of Free Democrats. All he would say
was there had always been disagreements since the coalition was
formed, but, in his view, the two parties should settle these
differences together.

* * *

 Key Economic Figures - Statistical Office

         Following a revival earlier in the year, economic growth
slowed down in the last months of the first half of the year, the
pace of growth in investment has also slowed down, and output in the
construction industry has also declined, the Central Statistical
Office (KSH) informed MTI on Friday.

        According to the KSH report, industrial production in the first
quarter of the year was 10 per cent up on that over the corresponding
period of 1994, however, the rate of growth was only around 7 per
cent in the second quarter. In the first half of the year, the
construction industry's performance was 1.5 per cent down on that
registered last year over the same period.

        In the first six months of 1995, investment went up by 30 per
cent as compared with that over the same period in 1994. Retail sales
fell by 5 per cent in the first half of the year, imports rose by 2
per cent and exports remained at last year's level.

        The net earnings of employees were 14 per cent higher in the
first half of 1995 than in the corresponding period of 1994. However,
due to inflation, real earnings were 11 per cent less than those
registered over the same period last year.

        The foreign trade balance continued to worsen: the trade
deficit had risen to USD 2.3 billion by the end of June, which
accounts for 43 per cent of the export revenues over the same period.
At the end of the first six months of 1994, the deficit was USD 1.8
billion, accounting for 40 per cent of export revenues then. The
deterioration is mainly due to the increase in imports while exports
have stagnated.

        The deficit in the balance of payments on current account
amounted to nearly USD 2 billion over the first five months (January-
May), which is USD 538 million more than last year. The trade deficit
and interest payments are the underlying causes of this.

        The budget deficit was nearly HUF 195 billion at the end of
July. The high cost of debt servicing and the absence of the forecast
privatization revenues are the main reasons for this.

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A tovabbterjesztest a New York-i szekhelyu Magyar Emberi Jogok
Alapitvany tamogatja.

           [*]   [*]  [*]   [*]  [*][*]    [*][*][*]
           [*]   [*]  [*]   [*]  [*]  [*]  [*]
           [*][*][*]  [*][*][*]  [*][*]    [*][*] 
           [*]   [*]  [*]   [*]  [*]  [*]  [*]    
           [*]   [*]  [*]   [*]  [*]   [*] [*]

Reposting is supported by Hungarian Human Rights Foundation News
and Information Service.
*****************************************************************