Row over plan for huge Fudan University campus in Budapest

Hungary has officially signed an agreement with Fudan University, Shanghai – one of China’s most prestigious institutions – allowing work to begin on a branch campus in the Hungarian capital Budapest.

But the signing comes amid a raging row over taxpayer funding of the campus and claims by opposition Hungarian politicians that it will encroach on Budapest’s own plans for a big increase in accommodation for local students.

Under the deal signed in an online ceremony on 27 April by Hungary’s Innovation and Technology Minister László Palkovics and Fudan University President Xu Ningsheng, Hungary agreed to provide the land, buildings and facilities for the new Fudan Hungary campus – China’s first branch campus anywhere in Europe – set to open to students in 2024.

“The parties welcome that research institutes of Fudan Hungary University might contribute to attract numerous Chinese large enterprises to Hungary and as a result R&D centres may be established,” the Hungarian ministry said in a statement.

These could generate “significant development investments and thus substantial economic stimulation effects to the Hungarian economy”, it said.

Hungary already has a large number of Chinese businesses and is a hub for Chinese companies to enter the European Union market. China is also building a major high-speed railway line connecting Budapest with Belgrade as part of China’s Belt and Road Initiative to open up new markets to Chinese firms.

“Hungary has the biggest Chinese community in Central and Eastern Europe. Most of the Chinese investment in the region is located in Hungary. We have the Bank of China here and [other] Chinese banks,” said Tamas Matura, assistant professor at Corvinus University of Budapest and an expert on China’s relations with Central and Eastern Europe. He also pointed to major Huawei offices in the city and a secondary and elementary Chinese-Hungarian bilingual school.

“Generally speaking, political relations have been pretty good between the two sides for 15 years or so, and that might be a crucial issue because this is a time when tensions between the West and China are on the rise,” Matura told University World News.

“I imagine the leadership of Fudan University would be concerned nowadays about [a possible branch campus in] Berlin, Paris or other major Western cities, because sooner or later, they might be targeted by political tensions and scrutiny, and that is a risk for China,” said Matura, referring to the reputational risk faced by China in setting up a branch campus of one of its most prestigious universities in Europe.

“Any trouble could easily put the Chinese, the university’s leadership in a very odd position. So they have to be careful.”

Matura added: “In this regard Budapest seems to be like a political safe space, not only because of the various political relations between the Hungarian government and the Chinese government, but also because seemingly the Hungarian government is ready to contribute financially an enormous amount of money to bring Fudan University to Budapest.”

According to the document signed on Tuesday, after a memorandum of understanding was signed in December 2019, Fudan Hungary campus will set up four faculties – economics, social studies, medicine and engineering, employing 500 teachers and with a planned intake of 6,000 to 8,000 students. The university will also promote joint research and educational projects with other European universities, it said.

Graduates, who will be mostly masters students, will receive a double Hungarian and Fudan University degree.

Corvinus University of Budapest already has a double degree MBA programme with Fudan since 2019, which graduated its first students a few months ago.

Row over campus site

However, government documents leaked prior to the signing have led to strong protests and open conflict between the government and the mayor of Budapest, Gergely Karácsony, after the documents showed Hungary would incur massive debt for the construction and facilities.

Opposition politicians criticised the project after Hungarian investigative news outlet Direkt36 obtained government documents showing it would cost as much as €1.5 billion (US$1.8 billion) – more than the country’s entire annual higher education budget in 2019, making it one of the largest investments into Hungary’s higher education in recent decades.

The construction would use largely Chinese building materials and Chinese labour, and would be partly financed through a Chinese loan, which Hungary would pay for, according to Direkt36 in its report published on 6 April.

The documents indicate the campus construction contract would be awarded to China State Construction Engineering Corporation without a proper bidding process, which Direkt36 described as a manoeuvre to avoid European Union regulations on open tendering.

China plans to contribute an unspecified amount to the university foundation’s capital and then pay for the annual operating costs of the campus.

According to Direkt36, capital needed for the land – reportedly worth €2.3 million – and the construction will be provided by the Hungarian state.

“Chinese money comes to Hungary and goes back to China immediately through that construction company,” noted Matura, describing it as typical of projects under China’s Belt and Road Initiative.

“I think this financial mechanism might have played an important role in that [decision]” for Fudan to come to Hungary. “It’s a good opportunity for Fudan to get the full campus for free,” according to Matura.

“It is taxpayers’ money in the long run because we have to repay the loans,” Matura added. “Hungarian taxpayers will pay for the entire project, and that is very, very strange.”

Others have noted that for such a vast proportion of government higher education spending to go towards a single foreign campus project did not look like a good deal for taxpayers, particularly if a majority of students are likely to be Chinese, either recruited directly or under a joint programme where students spend part of the programme in Shanghai.

Clash between the government and municipality

The plans for Fudan Hungary have led to a major clash between the government and the municipality of District 9, the area designated for the Fudan campus. The land was originally allocated to the €1.6 million Student City programme, a government plan agreed by the Municipality of Budapest to provide low-cost housing for 8,000 to 10,000 university students and teachers in a former industrial zone.

District 9’s mayor, Krisztina Baranyi, said earlier in April that the investment would exclusively serve the interests of a private university as the government was “not only handing over the property but is also building on it, then handing over the university and its associated facilities to the Chinese”.

Last week, Budapest’s mayor, Karácsony, a leader of the opposition leftist Green Party and a former prime ministerial candidate, who is likely to challenge current Prime Minister Viktor Orbán in upcoming elections next year, said his administration was prepared to cancel the 2023 World Athletics Championships to be held in Budapest if the Student City was not built in its entirety.

Karácsony said he had ethical problems with indebting young people “just for Hungary to serve Chinese influence acquisition in Europe”, and characterised the money being invested by the government in the Fudan project as going towards the Chinese Communist Party instead of Hungarian university academics.

The ministry statement on Tuesday noted that the campus project was “in harmony” with the municipal scheme to build a hostel complex for students. The statement said there was “no contradiction” between the two projects.

Minister Palkovics has claimed that the original plans for the area, besides student accommodation and community facilities, included “associated development projects such as research institutes”.

But Karácsony has posted pictures of the plans which contradict official statements. According to the plans, the Fudan campus will be constructed in a portion of the Student City originally designated for residences and offices.

“Because, according to the lead documentation coming from the engineering [department of] government, the total size of the university would be something like half a million square metres (50 hectares). Nobody understands why it needs to be so big,” said Matura, pointing to a lack of transparency over the plans.

Matura noted that the government was “steamrolling” the project through parliament with a new law enacted last week on the financing of the project. The mayor of District 9 is proposing to hold a referendum on the use of the land.

“That referendum cannot really decide the fate of the project, legally speaking, but would give a very strong message,” Matura noted, adding that the government could try to stop a referendum using coronavirus rules on gatherings.

Technology and faculty strengths

But others have pointed to the benefits of the Fudan campus, including Fudan’s prestige as a top 100 university in global rankings and being among the top three in China. Some local union organisations fear it will siphon off some of Hungary’s top academics with higher pay and top-notch science facilities and technology programmes.

The agreement signed Tuesday says: “The parties shall facilitate the settlement of R&D centres of Chinese companies and the investments of further Chinese companies in cooperation with research institutes to be set up in the frame of Fudan Hungary University.”

It points to a focus, among other subjects, on “international studies and geopolitics, as there is an increasing global demand for foreign policy professionals who have a comprehensive knowledge of Chinese culture and are experts in global roles and relations”.

According to Tuesday’s statement from Fudan and the government, Fudan could “contribute to improving Hungarian higher education through a healthy competition between universities and involving renowned foreign professors”.

It also stated that the new institution wanted to encourage joint research and educational projects with Hungarian and European universities.

However, the European Commission has warned against using branch campuses and other types of collaboration to access European Union research funding.

Hungarian universities are underfunded and lecturer salaries are low, Matura noted. “Fudan has an immense amount of money; their annual budget is around twice as high as the total combined budget of all Hungarian universities. And they have the prestige. I believe they would hire a lot of high-ranking and high-profile professors and experts to teach in Hungary. Of course, they will send a lot of Chinese professors as well.”

Fudan University has some 4,500 faculty and 30,000 students in Shanghai.

“In fields of technology, we have a lot to learn from the Chinese. Some people have already mentioned that Huawei would be a natural partner for Fudan Hungary to set up some kind of research centre. In fields like artificial intelligence, or 5G or 6G [telecommunications networks], they can bring a lot of expertise to Hungary that would benefit not only Hungary, but maybe the whole European Union,” Matura said.