Hungary backs away from Russia-backed bank following U.S. sanctions

14 April, 02:32 PM
Viktor Orban and Vladimir Putin at a meeting in 2018 (Photo:Kremlin)

Viktor Orban and Vladimir Putin at a meeting in 2018 (Photo:Kremlin)

Responding to the introduction of U.S. sanctions, the Hungarian government is resigning from the International Investment Bank (IIB) – a Russia-controlled financial institution, the Hungarian State Secretary responsible for international communications, Zoltan Kovacs, wrote on Twitter on April 13.

The government has also recalled its employees that were delegated to IIB offices.

The move comes after the U.S. Treasury Department introduces sanctions on April 12 against Russian oligarch Alisher Usmanov and the Budapest-based IIB.

“The IIB’s presence in Budapest enables Russia to increase its intelligence presence in Europe, opens the door for the Kremlin’s malign influence activities in Central Europe and the Western Balkans, and could serve as a mechanism for corruption and illicit finance, including sanctions violations,” the Treasury explained the move.

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According to Kovacs, “the [Hungarian] government discussed the situation that had developed in the wake of the sanctions and established that while the IIB had played an important development role in Eastern and Central Europe, in response to the U.S. sanctions, the bank’s purpose had lost its meaning.”

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