Hungary signals to EU that it may lift veto on funding for Ukraine − Politico

Hungary has signalled to the European Union that it is ready to withdraw its opposition to new long-term funding for Ukraine.

Source: European Pravda, citing Politico

Details: Several European diplomats and officials, speaking to the publication, have reported that Hungarian Prime Minister Viktor Orbán is approaching a compromise on the use of funds from the European Union budget to support Ukraine, even if it does not meet the demands he put forward after the EU summit in December 2023.

In December, Orbán blocked a four-year funding package for Ukraine worth €50 billion. The publication notes that since then, both sides have been engaged in delicate negotiations to find a solution for approving assistance at the EU leaders' summit on 1 February.

Diplomats and officials say that, despite the lack of consensus within the EU regarding Hungary's demands, the European Union is confident that an agreement can be reached in the coming weeks.

While there is some willingness in Brussels to offer certain concessions to Orbán to reach a deal, most national capitals have rejected Hungary's attempt to split the financing for Ukraine into annual tranches, requiring unanimous approval each year.

Because, in practice, this would give Orbán the right to block EU funding for Ukraine annually or demand concessions from Brussels in exchange for lifting the veto. An EU diplomat called it "very unlikely" that member states would decide to give Hungary "the chance of regular blackmailing".

Another proposal from Hungary involves a mid-term review of financing in 2025. However, even this option is deemed unacceptable by strong supporters of Kyiv, as it would once again "create chaos" in 12 months. Sources noted that this contradicts the logic of the EU's seven-year budget, which aims to ensure stability and predictability.

Sources say a potential compromise could involve the European Commission reimbursing Hungary for interest payments on loans obtained post-pandemic. The Commission is also considering introducing an "emergency brake", allowing any country opposing financing for Ukraine to suspend payments and defer discussions to the EU leaders' summit. However, this option would not allow any EU member state to veto payments.

The consensus is that any final compromise must include certain concessions to Hungary – sufficient for Orbán to claim victory at home. 

Two diplomats noted that Budapest's repeated veto on funding for Ukraine would prompt EU capitals to call for the application of the so-called Article 7 procedure, which could suspend Hungary's voting rights in EU decision-making.

Background: On 16 January, Hungarian Prime Minister Viktor Orbán once again expressed his opposition to the European Union’s plan to commit €50 billion to four years of macro financial aid for Ukraine, saying that help for Ukraine should not "harm the EU's budget".

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