Hungary pulls out of Russia linked IIB, one day after US sanctions

Budapest, Hungary: A day after Washington imposed sanctions on the organisation and many of its employees, Hungary’s government said on Thursday that it is leaving the Budapest-based International Investment Bank (IIB), which is headed by Russia. “The government discussed the situation and found that although the IIB played an important development role in Central and Eastern Europe, the operation of the bank lost its meaning as a result of the imposed American sanctions,” said a statement by the Hungarian Ministry for Economic Development sent to AFP. “Therefore, the government is recalling the persons holding positions in the IIB and delegated by the Hungarian state, as well as withdrawing from the international financial organisation,” it added. The IIB and three of its top executives – a Hungarian and two Russians – who reside in Hungary have been sanctioned, according to David Pressman, the US ambassador in Budapest, on Wednesday. The officials were among dozens who had recently been added to a US list of organisations and people subject to sanctions as part of an effort by Washington to limit Russians’ access to the global banking system. Under Prime Minister Viktor Orban, who had strong connections with Russian President Vladimir Putin before the Ukraine conflict, the IIB relocated its headquarters to Budapest in 2019. The bank’s other EU backers – Bulgaria, Czech Republic, Romania and Slovakia – have quit the lender since Russia’s invasion of Ukraine. The other members, besides Russia itself, are Cuba, Mongolia and Vietnam. Pressman said the presence in Budapest of “this opaque Kremlin platform in the heart of Hungary threatens the security and sovereignty of the Hungarian people, their European neighbours and their NATO allies”. Orban has drawn fierce criticism from both EU and NATO allies for his neutral stance on Russia’s war in Ukraine. “We have concerns about the continued eagerness of Hungarian leaders to expand and deepen ties with the Russian Federation despite Russia’s ongoing brutal aggression to Ukraine and threat to transatlantic security,” Pressman said Wednesday. With the sanctions “the US is demonstrating that we will take action in response to Hungary’s choices,” he said. Founded in 1970 by the Soviet Union to foster links within the communist bloc, the IIB is registered as an official Russian state organ. Billed as a version of the London-based European Bank of Reconstruction and Development (EBRD) – albeit smaller – the bank distributes loans to firms and projects in member countries. Read all the Latest News, Trending News,  Cricket News, Bollywood News, India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.