The small-town mayor, long a loyal foot soldier for Hungary’s governing party, recently committed what he described as “political suicide,” throwing himself in the path of an enormous $7.8 billion Chinese battery factory project promoted by his dissent-intolerant prime minister, Viktor Orban.
“It is like lying in front of a steamroller,” Zoltan Timar, the mayor of Mikepercs, said of his decision to side with residents opposed to the project, which his Fidesz party championed. “I just hope it won’t roll over me too soon.”
The factory, which would be the biggest of its kind in Europe, is the fruit of a yearslong diplomatic and economic tilt by Mr. Orban away from the West toward countries like China and Russia. It promises to put Hungary at the center of a wrenching and, for some, highly profitable green transition, with electric cars leading the way.
But residents in Mikepercs, a Fidesz stronghold in eastern Hungary, are seething over the arrival on nearby farmland of bulldozers and dump trucks preparing the way for the Chinese plant. Many worry the project would create pollution, drain their water supply and bring an influx of Chinese and other foreign workers.
“Pocketknives have opened up in everyone’s pocket,” said Eniko Pasztor, a pensioner and opponent of the factory, using a Hungarian phrase used to express anger.
Two public hearings on the venture, held in the nearby city of Debrecen in January, descended into chaos amid fistfights and shouts of “traitor” directed at officials by residents anxious about their future health and property values.
Taman Polgar Toth, a journalist with a local news site, Debreciner, said he “had never seen anything like it — hundreds of people yelling and fighting.”
Demonstrators protested against the planned factory, holdings signs with phrases like “Clean water and air” in Debrecen in February.Credit…Attila Kisbenedek/Agence France-Presse — Getty Images
Behind the noise, however, lie two of the most consequential and closely entwined issues of the day: China and climate change. Disagreement over what to do about either has thrust tiny Mikepercs (population: 5,300) into a global ruckus.
In a push to dominate new technologies vital to the reduction of carbon emissions, China has lavished tens of billions of dollars’ worth of tax breaks and other subsidies on its electric carmakers.
It is now the world’s biggest maker of batteries for electric vehicles, led by Contemporary Amperex Technology Ltd., or CATL, the company behind the Hungarian project.
China’s dominance of the industry has raised alarm in the United States, where a recent battery-factory project involving CATL in Virginia collapsed after Gov. Glenn Youngkin denounced it as a “front for the Chinese Communist Party.” In Europe, there have been warnings about the risks of dependence on Chinese battery manufacturers.
CATL already has a $2 billion plant in Germany that was widely welcomed, but its plans for the larger one in Hungary has left it at odds with the nearly half of the country’s population that, according to a survey this week, wants new battery plants banned.
Mr. Orban’s courtship of China and its investors is part of Hungary’s “Eastern Opening,” a policy he announced in 2010 in an abrupt turn away from his previous role championing democracy, human rights and Tibet’s exiled spiritual leader, the Dalai Lama.
The shift has delighted Beijing. On a visit last month to Budapest, the Hungarian capital, China’s senior foreign policy official, Wang Yi, praised Hungary for its “China-friendly policy.”
Two public hearings on the factory, held in Debrecen, a larger city near Mikepercs, descended into chaos amid shouts of “traitor” directed at officials, as well as fistfights.Credit…Akos Stiller for The New York Times
Many other European countries have soured on China, in part because of its support for Russia over the war in Ukraine. But Hungary — already isolated from its NATO and European Union allies because of its equivocal stand on the war — has doubled down.
“He is the last man standing as a friend of China in the European Union,” said Tamas Matura, a foreign relations scholar at Corvinus University in Budapest.
When Hungary announced the battery plant last August, it trumpeted it as the biggest foreign investment in the country’s history.
Previous Chinese megaprojects in Hungary, notably a nearly $3 billon high-speed railway between Budapest and Belgrade, the capital of neighboring Serbia, have been mired in delays and accusations of corruption relating to secret contracts for Mr. Orban’s allies in business.
Now, the battery plant has been met with stiff opposition, first from local residents, and then from opposition politicians and civil society activists.
They were joined last week by the governor of Hungary’s central bank, Gyorgy Matolcsy, a former Fidesz stalwart who accused Mr. Orban’s government of stoking inflation by pursuing economic growth through large foreign investments in basic manufacturing, like battery plants. Hungary has become a manufacturing hub for German carmakers, Asian companies like Samsung, which has a battery plant near Budapest, and others foreign corporations.
The new Chinese battery factory is expected to create 9,000 jobs, but some economists say the macroeconomic gains, like years of robust growth, from such projects are offset by the inflation they help fuel. Hungary has Europe’s highest annual rate of inflation, running at around 25 percent.
Eniko Pasztor, a pensioner and opponent of the factory, worries what might happen to the well water in her garden in Mikepercs.Credit…Akos Stiller for The New York Times
Gergely Karacsony, the mayor of Budapest, a prominent liberal critic of both Mr. Orban and China who has renamed several streets in the capital to give them names like “Free Hong Kong Road,” said the “huge Chinese factory is a symbol of Hungary’s model of capitalism” based on what he said were “low wages, low environmental standards and low protection for workers.”
“In Hungary, we have socialism for the elites and capitalism for the masses,” he said.
More worrying for the government is the public rift, small but highly unusual, that has opened up within the ranks of Fidesz.
Mr. Timar, the mayor of Mikepercs, won 100 percent of the vote in the last election in 2019, his fifth victory in a row for the party.
Struggling to contain discontent among its supporters, Fidesz has deployed its vast media apparatus to paint the furor over the battery plant as the work of outside agitators funded by the Hungarian-born financier George Soros, the governing party’s go-to villain, and “fake” residents mobilized by the opposition.
But Fidesz’s problems began last November, when a group of women in Mikepercs, angry that they had not been consulted about the Chinese project, organized a street protest, the first of many.
Ms. Pasztor, the pensioner, joined other women to form Mothers of Mikepercs, a group that wants to halt construction of the factory until residents have reliable information about what it would mean for their water supply, noise levels and pollution. Another big question they have is where the plant’s workers would come from, since unemployment in the area is nearly nonexistent.
The factory, which would be the biggest of its kind in Europe, is the fruit of a yearslong diplomatic and economic tilt by Mr. Orban toward countries like China and Russia.Credit…Akos Stiller for The New York Times
The mayor, Mr. Timar, held a town-hall meeting and invited CATL to address local concerns. The company, he said, told him it was “too busy” to send someone to answer questions.
Asked about the meeting, a spokesman for the Chinese company, Fred Zhang, said CATL “communicates regularly” with the mayor and has been “actively responding to questions and concerns from local residents.”
Many of the concerns, he added, “are misinformation and misunderstanding. We intend to strengthen our communications with local communities in the future.”
Ms. Pasztor said she has nothing against China but did not want neighborhood houses turned into dormitories for Chinese and other foreign workers, a widespread concern after years of anti-immigrant fear-mongering by Mr. Orban and his party’s media machine.
The Fidesz mayor of Debrecen, Laszlo Papp, a strong supporter of the Chinese factory, acknowledged that many locals were upset but said this was largely because there “is a lot of fake information” about how much water the plant would use, where factory workers would come from and other issues.
He added that it was important to keep an eye on long-term economic development and not be distracted by “momentary shifts in the public mood” driven by political rivalries. “You can’t run a city on the basis of mood and feelings,” he said.
The Chinese factory, its supporters say, is vital for the whole country.
“The green transition is inevitable, and we want to be part of it,” said Mate Litkei, director of the Climate Policy Institute in Budapest, hailing the Chinese investment as an important contribution to the shift away from fossil fuels.
Laszlo Papp, the mayor of Debrecen, said that “a lot of fake information” about how much water the plant would use and other issues was causing some locals to oppose the plant.Credit…Akos Stiller for The New York Times
Mr. Litkei said that Hungary needed to ensure there were enough batteries on hand before 2035, when a European Union ban on the sale of new gas and diesel cars will start.
Mercedes-Benz Group, which has a big factory in Hungary, welcomed CATL’s plans, saying it would be the “first and biggest customer of the new plant’s initial capacity.”
When CATL in January opened a much smaller battery factory in Germany, it met with no opposition from local residents or German environmentalists, whose Green Party is part of the coalition government in Berlin.
In Hungary, however, politics have become so polarized and toxic, with Fidesz for years vilifying environmental activists as agents of Mr. Soros, that neither side trusts the other.
Hungarian environmentalists see electric cars as a big improvement on carbon-emitting vehicles, but point to the damage caused by the mining and processing of lithium, cobalt and other hazardous materials used to make batteries.
On top of that, said Peter Ungar, co-chairman of the Green Party of Hungary, factories like the one next to Mikepercs consume vast amounts of water and energy and cover arable land with concrete. CATL’s Hungarian plant would cover an area around the size of 400 football fields.
“Batteries are not our salvation,” Mr. Ungar said. “Nor is China.”
Barnabas Heincz contributed reporting from Budapest, and Keith Bradsher from Beijing.