This week, the Hungarian government under Prime Minister Viktor Orbán confirmed it has secured a billion-euro ($1.09 billion) loan from Chinese banks, which Budapest must repay in three years.

The loan, finalized in April, came ahead of Chinese leader Xi Jinping’s visit to Hungary, where he and Orbán signed over a dozen bilateral agreements.

Following Hungary’s assumption of the EU Council presidency, Orbán and Xi met again in July during Orbán’s efforts to address the Russian invasion of Ukraine.

This loan is reportedly the largest in modern Hungarian history and is causing concern among observers familiar with China’s exploitative lending practices through the Belt and Road Initiative (BRI).

While this loan does not appear to be part of the BRI, it is intended for infrastructure projects and involves the China Development Bank, the Export-Import Bank of China, and the Bank of China’s Hungarian branch, all at a variable interest rate, Breitbart News has reported.

Politico notes that Orbán’s government, grappling with high public debt due to ambitious social programs, views China as a key ally in a multipolar world and has focused on strengthening trade and academic ties while avoiding criticism of China’s human rights abuses.

Written by B.C. Begley