Hungary set on closer ties with Russia, U.S.: foreign minister

Hungary's foreign minister

By Krisztina Than and Marton Dunai

BUDAPEST (Reuters) – Hungary favors closer ties with Russia and also expects links with the United States to improve markedly under President Donald Trump, whose criticism of NATO’s strategy on terrorism it endorses, its foreign minister said on Friday.

In an interview with Reuters days before Russian President Vladimir Putin visits Budapest to discuss closer energy ties, Peter Szijjarto also said the European Union’s sanctions regime against Moscow was ineffective and should be scrapped.

“Hungary’s position on the sanctions is that (they are) useless,” Szijjarto said, estimating Hungary had lost export opportunities worth $6.5 billion since they were introduced in place in 2014.

“Should we be happy with Russia’s economy declining? No, we regret that,” he said, adding that Budapest did not view Moscow as a threat.

Hungary, a member of NATO and the EU, has remained on good terms with Russia under the sanctions regime, imposed following its annexation of Crimea in March 2014 and its subsequent involvement in the separatist conflict in Ukraine.

Prime Minister Viktor Orban has in the past criticized the sanctions, and his overall relations with EU authorities have been less smooth, with Budapest notably defying Brussels over the latter’s attempt to introduce a quota system for hosting refugees.

Speaking in English, Szijjarto said the sanctions had also damaged the wider European economy and failed politically as they had not persuaded Russia to honor the four-power Minsk agreement to end the fighting in eastern Ukraine.

His preference would be for “really high level” talks to find new footing for relations with Russia.

“I don’t see Russia as a threat on Hungary. I understand and respect that our Polish friends, Baltic friends have another position on that… Russia would not attack any NATO member state. I don’t think it would be in Russia’s interest.”

TALKING ENERGY

Szijjarto said Hungary, which will host Putin on Feb. 2, is already looking at ways to extend cooperation on natural gas supplies with Russia beyond 2021.

“We have to start now,” he said, adding Budapest would like to develop alternative energy sources but Russia was far more reliable than European partners, which had failed to build the necessary infrastructure to reduce reliance on Russian gas.

Hungary is also pressing ahead with the construction of two new power blocks at its Paks nuclear plant, a 10 billion euro deal with Moscow that has come under scrutiny from Brussels, with a state aid probe still pending.

Once that probe gives the green light, “we will start (construction) immediately,” Szijjarto said.

Budapest also expects a “massive improvement” in ties with Washington, he said, agreeing with Trump’s view that NATO had failed to defend successfully against the threat of terrorism.

“Currently if we speak about threats …I see ISIS as a threat… A non-state actor is the most serious threat to the civilized world. And in this regard, I think yes, NATO could have a bigger role.”

Hungary’s Prime Minister Viktor Orban clashed with the Barack Obama administration over what critics said was an erosion of democratic values by his government.

Last year Orban was one of the first international leaders to endorse Trump, who, Szijjarto said would no longer “interfere into the internal political issues of Hungary.”

“Now as the new President made it very clear that export of democracy is out of the focus of US foreign policy… this kind of pressure… will disappear,” he said.

(editing by John Stonestreet)

NATO, Russia and trade top the agenda for Trump talks with Britain’s May

Theresa May before meeting Donald Trump

By Steve Holland and Elizabeth Piper

WASHINGTON (Reuters) – U.S. President Donald Trump and British Prime Minister Theresa May, who share an unusual bond as the products of anti-establishment uprisings, will sit down on Friday for what could be a difficult search for unity on NATO, Russia and trade.

The meeting will mark Trump’s first with a foreign leader since taking power a week ago, and it could go a long way toward determining how crucial Trump considers the traditional “special relationship” between the two countries.

Trump rode an anti-Washington wave to win on Nov. 8, and May gained power in July after the “Brexit” vote that has put her country on a path to separate from the European Union. The meeting will conclude with a joint White House news conference.

Trump has declared NATO obsolete and expressed a desire for warmer ties with Russia. May considers the trans-Atlantic alliance crucial and is skeptical of Russian President Vladimir Putin.

They both want to begin work on a bilateral trade agreement, which for May would provide proof of stability amid the Brexit breakup and for Trump would support his belief that he can negotiate one-on-one trade pacts.

“They both need this to be a success,” said Heather Conley, a European expert at the Center for Strategic and International Studies think tank.

Trump, she said, “needs to demonstrate that he has a command of issues” while May “needs to hear strong messages of support for her vision of a Britain that works for everyone, a global Britain.”

May, in a speech to Republican lawmakers gathered in Philadelphia on Thursday, suggested she saw the need for some reforms in NATO and for more countries to pay more to the alliance to help fund it, which has been Trump’s main complaint about NATO.

“America’s leadership role in NATO – supported by Britain – must be the central element around which the alliance is built,” May said.

But she said that EU nations “must step up” to ensure NATO remains the cornerstone of the West’s defense.

Trump and May also seem somewhat at odds over how to deal with Russia. In her speech, May said Western leaders should “engage but beware” of Putin and should not accept Putin’s claim that Eastern Europe is now in his sphere of influence.Trump, on the other hand, wants a strong U.S. relationship with Russia to fight Islamic State militants.

“I don’t know Putin, but if we can get along with Russia, that’s a great thing,” Trump told Fox News’ Sean Hannity” on Thursday. “It’s good for Russia, it’s good for us.”

(Reporting by Steve Holland and Elizabeth Piper; Editing by Leslie Adler)

Anxious world leaders seek clarity on Trump policies

Donald Trump arriving at election night speech

By Angus MacSwan

LONDON (Reuters) – World leaders reacted to Donald Trump’s victory in the U.S. presidential election with offers to work with him tinged with anxiety over how he would deal with a host of problems, from the Middle East to an assertive Russia.

Several authoritarian and right-wing leaders commended the billionaire businessman and reality TV star who against the odds won the leadership of the world’s most powerful country.

Trump, who has no previous political or military experience, sent conciliatory signals after his upset of Democratic rival Hillary Clinton, pledging to seek common ground, not conflict, with the United States’ allies.

During his election campaign, Trump expressed admiration for Russian President Vladimir Putin, questioned central tenets of the NATO military alliance and suggested Japan and South Korea should develop nuclear weapons to shoulder their own defense burden.

Putin was among the first to send congratulations after Trump declared victory.

Ties between Washington and Moscow have become strained over the conflicts in Ukraine and Syria, and allegations of Russian cyber attacks featured in the U.S. election campaign.

“We heard the campaign statements of the future U.S. presidential candidate about the restoration of relations between Russia and the United States,” Putin said.

“It is not an easy path, but we are ready to do our part and do everything to return Russian and American relations to a stable path of development.”

Among other issues causing concern among allies are Trump’s vows to undo a global agreement on climate change, ditch trade deals he says have been bad for U.S. workers and renegotiate the nuclear accord between Tehran and world powers which has led to an easing of sanctions on Iran.

Iranian Foreign Minister Javad Zarif urged Trump to stay committed to the Iran deal. Iranian President Hassan Rouhani said the election result would have no effect on Tehran’s policies and the nuclear accord with six world powers could not be dismissed by one government.

Elsewhere in the Middle East, Israel’s Benjamin Netanyahu, who had a poor relationship with President Barack Obama, said he hoped to reach “new heights” in bilateral ties under Trump.

Obama and Netanyahu sparred over the issue of Israeli settlements, while Trump has said they should expand.

Palestinian President Mahmoud Abbas also congratulated Trump, but analysts said his rule may be profoundly negative for Palestinian aspirations.

And despite Trump’s negative rhetoric about Muslims during his campaign, including threats to ban them from the United States, Egyptian President Abdel Fattah al-Sisi said he hoped the business magnate’s election would breathe new life into U.S.-Egyptian ties.

UNCERTAINTY

In Britain, where Trump’s victory had echoes of last June’s referendum in which voters showed dissatisfaction with the political establishment by voting to leave European Union, Prime Minister Theresa May said the “enduring and special relationship” between the two countries would remain intact.

Nigel Farage, a leader of the Brexit campaign who spoke at a Trump rally during the election campaign, tweeted: “I hand over the mantle to @RealDonaldTrump! Many congratulations. You have fought a brave campaign.”

But some European officials took the unusual step of denouncing the outcome, calling it a worrying signal for liberal democracy and tolerance in the world.

“Trump is the pioneer of a new authoritarian and chauvinist international movement. He is also a warning for us,” German Vice Chancellor Sigmar Gabriel told Funke newspaper group.

Some leaders are smarting from insults that Trump doled out in the past few months, such as calling German Chancellor Angela Merkel “insane” for allowing more than 1 million migrants into the country last year.

“We’re realizing now that we have no idea what this American president will do,” Norbert Roettgen, a conservative ally of Merkel and head of the German parliament’s foreign affairs committee, told German radio. “Geopolitically we are in a very uncertain situation.”

President Francois Hollande said France wanted to begin talks with Trump immediately to clarify his stance on international affairs.

“This American election opens a period of uncertainty,” Hollande said.

French officials had openly endorsed Clinton and warned that Trump’s “confused” foreign policy objectives were alarming for the rest of the world.

“The U.S. is a vital partner for France and what’s at stake is peace, the fight against terrorism, the situation in the Middle East, economic relations and the preservation of the planet,” Hollande said.

But like-minded right-wing European parties that are hoping to make inroads of their own in 2017 — a year in which Germany, France and the Netherlands hold elections, and Italy and Britain could also do so — hailed Trump’s victory.

“Their world is falling apart. Ours is being built,” Florian Philippot, a senior figure in France’s far-right National Front (FN), tweeted.

CHINA CONCILIATORY

In Asia, Chinese President Xi Jinping sent a message with a conciliatory tone, telling Trump that Beijing and Washington shared responsibility for promoting global development and prosperity.

“I place great importance on the China-U.S. relationship, and look forward to working with you to uphold the principles of non-conflict, non-confrontation, mutual respect and win-win cooperation,” Xi told Trump, who said on the campaign trail to take on China and to tax Chinese imports to stop currency evaluation.

South Korea expressed the hope that Trump would maintain current U.S. policy of pressuring North Korea over its nuclear and missile tests. Seoul was concerned Trump may make unpredictable proposals to North Korea, a ruling party official said, quoting top national security officials.

A Japanese government official, speaking before Trump clinched the election, urged him to send a message as soon as possible to reassure the world of the United States’ commitment to its allies.

“We are certainly concerned about the comments (Trump) has made to date about the alliance and the U.S. role in the Pacific, particularly Japan,” the Japanese official said.

(Reporting by Reuters bureaus in Europe, Asia and the Americas, Editing by Sonya Hepinstall and Angus MacSwan)

Top diplomats from U.S., Japan, South Korea to meet on North Korea

World leaders from US, Japan, and South Korea

By Tony Munroe and Ben Blanchard

SEOUL/BEIJING (Reuters) – U.S. Secretary of State John Kerry will meet with his Japanese and South Korean counterparts in New York on Sunday to discuss responses to North Korea’s latest nuclear test, South Korea’s foreign ministry said on Wednesday.

The three countries are pushing for tough new U.N. Security Council sanctions on North Korea after the isolated country on Friday conducted its fifth and largest nuclear test.

The blast was in defiance of U.N. sanctions that were tightened in March.

China, the North’s chief ally, backed the March resolution but is more resistant to harsh new sanctions this time after the United States and South Korea decided to deploy a sophisticated anti-missile system in the South, which China adamantly opposes.

South Korea said Foreign Minister Yun Byung-se and his counterparts Kerry and Japanese Foreign Minister Fumio Kishida will meet during the annual U.N. General Assembly to discuss putting further pressure on North Korea.

The United States wants China to do more, with U.S. Defence Secretary Ash Carter last week singling out the role he said China should play in curbing its neighbor.

TESTING TIMES

North Korea has been testing nuclear weapons and ballistic missiles at an unprecedented rate this year under young leader Kim Jong Un.

On Tuesday, Chinese Foreign Minister Wang Yi spoke with South Korea’s Yun by phone, expressing Beijing’s opposition to the North’s latest nuclear test but also reiterating opposition to the planned deployment of the Terminal High Altitude Area Defense (THADD) anti-missile system in the South, China’s foreign ministry said.

China is North Korea’s most important diplomatic and trade partner and refuses to cut the country off completely, fearing it could collapse.

Beijing’s official People’s Daily newspaper on Wednesday called the United States a troublemaker and said it has no right to lecture China about taking responsibility for reining in North Korea as tensions on the peninsula are a direct result of U.S. actions.

In a commentary, the ruling Communist Party’s official paper said the United States was pretending it had nothing to do with the North Korea issue and was putting the blame on others.

“People have reason to doubt whether Washington is willing to make the effort to push the North Korea issue in the direction of a resolution,” the paper said.

China and Russia have pushed for a resumption of six party talks on denuclearization in North Korea. The talks, which also involve Japan, South Korea and the United States, have been on hold since 2008.

Washington has said it is willing to negotiate with the North if it the country commits to denuclearization, which Pyongyang has refused to do.

Japanese Prime Minister Shinzo Abe will seek Cuba’s help in responding to North Korea’s nuclear and missile programs during a rare visit to Havana next week, a spokesman said.

(Editing by Lincoln Feast)

Italy’s Renzi signs potentially huge business deals in Iran

Iran and Italy Leaders

ROME (Reuters) – Italy and Iran signed deals potentially worth billions on Tuesday when Prime Minister Matteo Renzi visited Tehran seeking a strong Italian foothold in a nation hungry for infrastructure investment as it emerges from financial isolation.

Renzi was accompanied by a delegation of some 60 business leaders in sectors including, energy, railways and defense, and by Italy’s export agency and state lender which pledged billions of euros in credit lines and guarantees.

Three months ago President Hassan Rouhani made Italy his first stop in Europe as he sought to drum up investment in the Iranian economy, which rejoined the global trading system in January following a deal to lift crippling sanctions in exchange for limiting its nuclear activities.

“The end of sanctions is a historic step not only for Iran but for the whole region,” Renzi told reporters in Tehran with Rouhani standing by his side.

“We are committed to making sure the efforts of the international community are accompanied by mutual trust and by the immediate relaunch of economic links.”

Business delegations from other European countries are expected in Tehran in coming weeks, but Italy is well positioned to win contracts that could deliver a much needed export boost for its chronically sluggish economy.

Enel said it signed a memorandum of understanding with the National Iranian Gas Export Company on possible future cooperation in natural gas, liquefied natural gas and related infrastructure, that could lead to long-term gas supplies for its power stations.

The Enel deal was one of seven signed by Renzi and Rouhani, Iranian state television said. Renzi was due to return to Rome on Wednesday.

Oil major Eni has an agreement that allows it to take oil from Iran in payment for previous investments while oil service group Saipem, expected to clinch a new deal on Tuesday, had already signed preliminary deals in January that a source said at the time could be worth $4-5 billion.

Italy’s state railways company, Ferrovie dello Stato, said it signed a “framework of cooperation” agreement to build two high-speed lines in Iran. The contract could be worth some 3 billion euros, a source close to the matter said.

Italy’s state-run lender Cassa Depositi e Prestiti will offer credit lines of 4 billion euros to companies building oil and gas infrastructure, while export agency SACE will guarantee loans and offer trade financing of 4.8 billion euros, a SACE statement said.

($1 = 0.8758 euros)

(Reporting by Steve Scherer and Stephen Jewkes, additional reporting by Sam Wilkin in Dubai, Isla Binnie in Rome and Francesca Landini in Milan, editing by Isla Binnie and Robin Pomeroy)