Subscribe here: [ Ссылка ] Hungary has backed the EU into a corner, blocking Ukraine aid and a global tax deal until it unlocks billions in EU funds.
Viktor Orbán has taken the EU hostage, essentially demanding billions in exchange for lifting vetoes on everything from Ukraine aid to a global corporate tax deal.
The billions are, according to the Hungarian leader, EU funds his country deserves as an EU member. But Brussels has been withholding them over concerns about Budapest’s erosion of democratic values, insisting Hungary first make a number of changes.
Now, the two sides are moving toward an agreement: The EU is expected to soon unlock the money after Hungary promised to adopt a set of reforms. EU leaders insist the revisions will reverse the country’s waning democratic norms and better protect the bloc’s cash from falling into corrupt hands. Budapest insists it is genuine about fulfilling its pledge.
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Left unspoken is a major factor driving the negotiations to a conclusion: Orbán has been blocking some of the EU’s most pressing initiatives, including an urgent €18 billion aid package for Ukraine and a worldwide deal to set a minimum corporate tax rate. His gambit? Get Brussels to hand over Budapest’s EU money.
“This is blackmail, pure and simple,” said an EU diplomat.
The stakes are high. In a no-deal scenario, Brussels risks losing face if it can’t deliver the promised aid to Kyiv or a global tax agreement it championed. EU officials are also loath to push Hungary’s struggling economy over the edge — and don’t want to be seen as deepening divides while war rages nearby.
EU affairs ministers are set to discuss Hungary's rule-of-law issues at a meeting in Brussels on Friday, and their finance colleagues will formally have a say on whether to release the money on December 6. But the eventual outcome already seems prebaked.
“They've done checkmate,” said an EU diplomat.
Hungary has until Saturday (19 November) to implement the 17 measures requested by the European Commission in September as a precondition for not suspending around €7.5 billion from the EU’s long-term budget in due to corruption and rule of law issues.
“Corrupt Swamp”
The words are harsh.
– Nothing has happened during these two months, says Spanish Eider Gardiazabal from the social democratic party group S&D.
– For twelve years, we have seen (Hungarian Prime Minister Viktor) Orbán promise changes and each time it has gotten worse, says German Daniel Freund from The Greens/EFA.
Decision pending
In terms of money, it is about EU support of the equivalent of 80 billion kroner, which Hungary risks being without. The EU’s other member states in the Council of Ministers are expected to make a decision on the issue within a month.
If the EU Parliament were to rule, it would be a resounding no.
– The facts on the table are that it is clear that the council must freeze or cut funding to Hungary, says Finnish Petri Sarvamaa from the Christian-democratic conservative party group EPP.
During the work on the EU’s long-term budget for the years 2021-2027, the member states agreed to introduce a special rule of law mechanism that will make it possible to stop EU money to member states that do not comply with basic rule of law principles. Formally, the money must be able to be withheld to avoid misuse of EU funds.
Decisions on measures against a country must be taken by the EU’s Council of Ministers if there is support from a qualified majority, i.e. at least two-thirds of the member states.
Poland and Hungary have strongly opposed the mechanism and taken it to the European Court of Justice, which however ruled in February this year that it was adopted correctly, within the framework of the EU’s powers.
