A $1.5 million roundabout shows the ‘urbanist economy’ from nowhere

The sign proudly announces that the roundabout near Zalaegerszeg in western Hungary was built with 500 million forints (about $1.5 million) in funding from the European Union.

The roundabout was built to serve a container terminal on a new railway line that would help give this landlocked part of Central Europe better access to the sea. Instead of passing through Budapest, the capital of Hungary, goods from the Adriatic coast will quickly transit through the west of the country to Slovakia, the Czech Republic, Poland and beyond.

But there is a problem. Even after years of construction of the roundabout, there is no railway. Instead, the roundabout is an unused area, waiting for the Hungarian government to build a railway that will make it useful.

Critics of Prime Minister Viktor Orbán say the EU-funded construction projects are a monument to the economic system his government built during his 16 years in office. Urban’s electoral success, they say, relentlessly demonized the EU – painting it as a decadent, liberal, corrupt force in Hungary – happily accepting large sums of money from it.

Much of the money came from initiatives to help poorer, more recent members of the bloc – many of which were part of the Warsaw Pact – catch up with their wealthier neighbors to the west. But, ahead of Sunday’s crucial parliamentary election, the opposition is asking what Hungary has to show for all this investment, pointing to what they see as vanity projects, and unfinished or unnecessary construction projects.

“Orban was the last rent-seeker in the European Union in the 2010s. It was a conscious strategy,” Christian Orban (no relation), founder of Orions, an investment firm in the region, told CNN. He also highlighted the government’s success in reducing its allocated funds compared to its neighbours, adding that Orbán “has been able to bring in huge amounts of EU money”.

The roundabout near Zalaegerszeg, first reported by Hungarian search site Atlatszo, is one of tens of thousands of projects in Hungary that have received EU funding since Viktor Orbán came to power. Regional Development Minister Tibor Navrassis told Hungary’s parliament last year that the EU had financed 52,000 projects in the country during the 2014-2020 budget period.

The director of the corruption research center Budapest, Istvan Janos Toth of Zalegerszeg, said the roundabout is a prime example of a “white elephant” – a construction project that is expensive to build, and often to maintain, but that offers little value.

“Without European funding, Orbán cannot establish this kind of system,” Toth told CNN.

The anti-corruption organization Transparency International has listed Hungary as the most corrupt country in the European Union. CNN has reached out to Hungary’s foreign ministry and the prime minister’s office for comment. The Hungarian government generally denies allegations of corruption or accuses its opponents of being corrupt themselves.

Work on the roundabout began during the current EU budget period, which runs until 2027. After purchasing a patch of land, Metrans, a logistics company operating in the area, planned to build a container terminal to connect with the new railway, which is also slated for construction.

In a ceremony in 2021, Hungarian Foreign Minister Peter Szijjártó laid the foundation stone of the new terminal. By the end of 2023, the local municipality – with the help of EU funds – had built a roundabout to support logistics around the terminal, Zalaegerszeg Mayor Zoltan Balaiz told CNN.

But when CNN visited the site in April, there was no evidence that planned railway construction had begun. Balaiz said the project is still in the public procurement stage. Whoever wins the procurement contract will have more than two years to build the track, Atlatszo reported, meaning the railway – if built – may not be ready until 2029.

The roundabout near Zalaegerszeg is not the only unfinished or unsupported project in Hungary to receive EU funding. David Pressman, former US ambassador to Hungary, said during his tenure that construction projects don’t always live up to their billing.

“A stark view from another ‘Forest Canopy Walkway’ in Hungary’s EU-funded Hatvan,” he wrote on social media in 2024, posting pictures of himself standing on the walkway — with no forest in sight.

Other examples, reported by Hungarian media, include a “lookout tower” that is meant to provide a viewpoint for tourists, but stands at less than a meter high.

Critics say Hungary is littered with such projects, often financed by the same entity against Orbán Rails.

“Instead of fighting an open economy, Orbán points to usurping outside powers … that threaten Hungarians and Hungarianness,” Pressman told CNN.

“It is much easier for the leader of the most corrupt country in the European Union to talk about the ‘clash of civilizations’ than to explain the extraordinary wealth his family has amassed and the suffering his people and his economy have suffered,” he said.

‘Interference’ claims

The issue of EU funding is playing an important role in the campaign for Sunday’s parliamentary elections.

Since 2022, the European Commission has frozen funding over concerns about Hungary’s democratic backsliding and judicial independence. As of last year, about €18 billion ($21 billion) in funds are blocked — representing about 10% of the country’s GDP. At the end of last year, members of the European Parliament again expressed concern about Hungary’s violation of the rule of law, as well as corruption and “misuse of EU funds”.

Economist Kristian Orbán said that the flow of EU funds during Orbán’s first decade in office meant that “he was able to get rid of many things, including corruption, including neglect of public services, because he was able to constantly improve the livelihoods of people who were not used to it.” Now that those EU funds are blocked, that deal is falling apart, he said.

Orban and his allies, including US Vice President JD Vance, who traveled to Budapest this week to support the prime minister, have accused the EU of meddling in Hungary’s election. The Commission maintains that EU members must uphold the rule of law in order to receive funding.

Peter Magyar, leader of the opposition Tisza party, has promised to free up EU payments, allaying the bloc’s concerns about Hungary’s democratic backsliding. He has waged a massive campaign against corruption, accusing Orbán and his allies of enriching themselves and impoverishing the country. Still, Magyar will face a tough challenge to meet the EU’s demands and unlock some funds before the August 31 deadline.

Tisza has held a double-digit lead over Orban’s Fidesz party in most polls for more than a year. Although Magyar’s victory would mark the end of what corruption expert Toth described as Orbán’s “bite-the-hand-that-feeds-you” approach to the EU, Hungary still needs financial support from Brussels, including Jálaegerszeg.

Mayor Balaiz said that once the Hungarian government builds the planned railway, his municipality will be able to build a second roundabout around the container terminal to support logistics. It will cost another 954 million forints (about $3 million), he told CNN — also from EU funds.

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