Hungary set to receive millions in EU money despite Orban’s threats to veto Ukraine aid

Sign up for the View from Westminster email for expert analysis straight to your inbox

Get our free View from Westminster email

Hungary is set to receive 900 million euros ($981 million) in European Union money, the EU’s executive arm said Thursday, despite the Hungarian prime minister’s attempts to scupper the bloc’s support for Ukraine.

That money comes from the bloc’s REPowerEU program aimed at helping the 27 EU nations recover from the energy crisis that followed Russia’s invasion of Ukraine last year, and reduce their dependance to Russian fossil fuels.

The proposal to unlock the money in pre-financing came as Orban – a frequent critic of the EU and often at odds with European leaders over his government’s record on the rule of law – threatens to derail Ukraine’s ambition to join the bloc, and to block the disbursement of a planned 50 billion euros ($54.5 billion) in aid to Kyiv.

EU leaders will meet in Brussels next month to discuss the opening of formal negotiations on Ukraine’s future accession.

EU member countries have now four weeks to endorse the European Commission’s decision and greenlight the disbursement of money.

The total value of the Hungary’s post-pandemic recovery plan, which includes the REPowerEU chapter, totals 10.4 billion euros ($11.3 billion) in loans and grants. The Commission insisted that Hungary must achieve rule of law reforms for the bulk of that money to be released.

“The Commission will authorize regular disbursements based on the satisfactory completion of the reforms to ensure the protection of the Union’s financial interests, and to strengthen judicial independence, as translated into 27 ‘super milestones,’” the Commission said in a statement.

Hungary, a large recipient of EU funds, has come under increasing criticism for veering away from democratic norms. The Commission has for nearly a decade accused Orban of dismantling democratic institutions, taking control of the media and infringing on minority rights. Orban, who has been in office since 2010, denies the accusations.

Orban has also repeatedly angered the EU since Russia started its war in Ukraine last year. He has criticized the sanctions adopted by member countries against Russia as being largely ineffective and counter-productive, and last month met Vladimir Putin in a rare in-person meeting for the Russian president with a leader of a European Union country.

Last December, the EU froze billions of euros in cohesion funds allocated to Hungary over its failure to implement solid rule-of-law reforms. Although Hungary insists it doesn’t link EU funds to other issues, many in Brussels see its veto threats regarding aid to Ukraine as Orban’s bid to blackmail the bloc into releasing billions in regular EU funds and pandemic recovery cash that has been held up.

The Commission also gave a positive assessment of Poland’s revised recovery plan earlier this week, paving the way for the payment of 5.1 billion euros ($5.56 billion) to Warsaw. The announcement came a month after an election in Poland secured a parliamentary majority to pro-EU parties aligned with Donald Tusk, who is expected to become Poland’s next prime minister. He traveled to Brussels last month to meet with top officials and repair Warsaw’s ties with the bloc, aiming to unlock funds that have been frozen due to democratic backsliding under the outgoing nationalist government.