The parliamentary elections which took place on 6 April brought an overwhelming victory for the former PM Orban’s centre-right Fidesz party. Fidesz won 45% of the vote, followed by the five-party left-leaning coalition (26% of the votes) and by the far-right Jobbik party, which emerged with around 20%. According to the new electoral system installed by the previous government, the Fidesz result will translate in a two-thirds majority of the parliamentary seats, the threshold permitting further constitutional changes.

Impact on country risk

The continuity of the Fidesz ruling should bring another four years of uncertainty and unpredictability in  terms of economic and fiscal policies, without any opposition forces able to threaten it. Measures disadvantaging foreign-invested sectors, such as the energy, telecom and banking ones, are likely to remain in place or being strengthened and to weigh on the business climate. While constitutional amendments  made during the previous legislature were viewed as threatening the independence of the judiciary, freedom of religion, freedom of the press and other democratic values by the European institutions and human rights associations, the reinforced presence of the far-right party in parliament is also likely to give still more support to Fidesz for adopting more nationalistic and Eurosceptic positions.

Analyst: Florence Thiéry, f.thiery@credendogroup.com