The Ages of the Impexes

Publications of the Institute for Hungarian Studies 1.

author: Zsuzsanna Borvendég

By the beginning of the 1970s, an economic interest group strengthened in Hungary which had an increasing influence on the operation of the one-party state. With the support of the secret service and the help of financial experts, the heads of the state foreign trade companies, the ‘Impexes’ were given the unique opportunity in the Eastern Bloc to freely establish businesses in the capitalist West by connecting to a western financial network. By boosting intermediary trade and establishing a network of offshore-type companies they switched on their money pump to systematically plunder and indebt Hungary. The Kádárian secret service – especially the military intelligence – transferred black money into secret bank accounts via an uncontrollable system of secret commissions and ‘constitutional costs’ to be able to partly finance the acquisition of forbidden COCOM-listed items for Moscow. 

The way how Hungarian companies deceived the alert American intelligence when they smuggled state-of-the-art technologies to the eastern side of the Iron Curtain is reminiscent of an episode of a spy film. The activity of the network was tainted with economic abuses and financial frauds. The network also invaded the energy sector and embezzled hundreds of millions of dollars from the country with the help of the ‘oil mafia’ of the time. As the change of political system was drawing closer, the network paid more and more attention to nurturing a new political elite loyal to them.