Hungary is a flat country for the most part with good soil and lots of freshwater. For an inland country these are blessings, but they require defense. Eastern Europe has been caught between Western Europe and Russia for the last two hundred years and as Russia’s empire grew that middle ground location has been more and more difficult to defend. Since 1990 Hungary has fostered a free-market economy and reoriented its defense posture, allying with Western Europe. In recent years, farming, which has always played a significant role in Hungary’s economic growth has played a smaller part than prior to independence from Soviet control.
Like all the other communist countries around the world, that are reorienting towards a free market, Hungary has had difficulties. The agricultural economy was privatized soon after 1990. One hundred and twenty collective state farms have been restructured and privatized, although the actual restructuring process of many of those farms is not yet complete. One third of those farms were liquidated, a quarter of the hundred and twenty are still under state ownership and the rest were privatized. The thing about privatizing collective farms is that it requires the development of a market for farm land. After all, in a free market system farm land is sold on an open market, and thus far the market for farm land in Hungary is in an embryonic condition.
Individual private farms now use more than half the agricultural land in Hungary and produce nearly sixty percent of the agricultural output. Farming corporations and newly created farming co-operatives occupy respectively, 18 percent and 28 percent of the land and together they produce approximately forty-three percent of Hungary’s agricultural output. What is new in all of this farm restructuring is the emergence of medium sized farms. Under Soviet control, Hungary had large collective state farms and very small farms, but few medium sized farms. For the emergence of a land market medium sized farms are an advantage. If the agricultural system supports medium sized farms then smaller farms can purchase land in order to grow into medium size land holdings and presumable thereby earn larger profits.
During the Soviet era about ninety percent of all farmland was organized into collective and state-owned farms. On collective farms several families combined to run the farm and shared the earnings from the farm’s output. State owned farms were directly owned and managed by the government. In 1990, the new independent government began returning farmland to private hands and also introduced ways of compensating those who had lost their private holding during the communist era. Unfortunately, soon after privatization began, Hungary experienced severe droughts which, in combination with elimination of state farm subsidies, caused a decade long drop in agricultural production.
Hungary’s leading agricultural crops are: corn, wheat, sugar beets, barley, potatoes, and sunflower seeds. Hungary also produces grapes and wine, one of which are the famous Tokay region wines. Other popular specialty food items coming from Hungarian farms are goose liver, paprika, and salami. Hungary is a net positive exporter and almost nine percent of those exports are food products, while a little over five percent of Hungarian imports are food products. Most import and export of Hungarian agricultural and food products are to other European countries.
Military Protection Reordered
An agricultural cycle requires productive land (soil) to be protected. The Hungarian military is called the Honvedseg, which translates to, “corps of homeland defenders.” Before the east-west orientation of Europe after the rise of France, Germany, Holland and England in the 17th and 18th centuries, Hungary was a middle-ground between Northern Europe and the Ottoman Empire to the South. The military was organized to defend against incursions from the South. Since 2007, the Hungarian military is organized as a unified command structure. With a unified command, the military is more adaptable to defend in whatever direction is required. The ministry of Defense maintains political and civil control over the army.
In 1999 Hungary became a member of NATO and has subsequently provided airbases and support for NATO actions in Kosovo, Serbia and Iraq. As a NATO member, Hungary’s military is tied to Western Europe and no longer part of the Russian orbit of influence. This is the most significant change in Hungary’s military situation. It’s not that Hungary is no longer a middle-ground location, it’s that the loyalty is now with a west looking alliance structure and no longer eastern looking and the organizational structure is adaptable for defense in various circumstances.
Hungary has made several significant modernization purchases of military equipment since 1990. Along with purchases, some of Hungary’s older military equipment, like it’s battle tanks were taken out of service. The purchases have been for aircraft, such as Gripen fighters, two seat and one seat airplanes and helicopters. There were also replacement of military land vehicles like the old GAZ 4x4s with more modern Iveco LMV type vehicles. The military is adapting to it’s new NATO membership by restructuring to a more adaptable mobile military that can deploy where needed in the NATO area of influence.
The combination of privatization in support of a free-market economy and the shift from the Russian orbit of influence to the west looking NATO alliance are the two biggest recent changes in Hungary’s agricultural cycle. These changes have not been easy or smooth because of the severe 2008 economic recession, which had a big impact in Hungary and due to drought. What is interesting about Hungary’s agriculture is how it adapts to its surrounding political and social circumstances. It’s made these changes many times over the centuries and the changes of the last few decades are probably a first volley in the shifting politics of the larger European and Mediterranean regions.