Bloomberg has learned that Hungary will abandon its objections to the creation of a military aid fund for Ukraine with an annual budget of 5 billion euros. Politico named the reason.
Hungary will abandon its veto, which opens the way to an agreement on modernizing a mechanism aimed at stable arms supplies to Kyiv. Budapest said it would not stand in the way of reaching consensus at the ambassadorial meeting, according to sources familiar with the discussions. EU on Wednesday.
Edition does not provide an explanation for the sharp change in the position of the Hungarian government. In December, Budapest famously vetoed a separate €50 billion economic support package for Kyiv, forcing EU leaders to meet again on February 1 in Brussels to reach a compromise with Hungary or circumvent the Hungarian ban.
Budapest is also blocking the release of the last 500 million tranche from the European Peace Fund. Foreign Minister Peter Szijjarto said his country could consider supporting the funds after a meeting with its Ukrainian counterpart scheduled for Monday.
The EU wants to reform the €5 billion military aid fund for Ukraine. Under the current funding mechanism, known as the European Peace Fund, member countries are reimbursed for weapons they send to Ukraine. The size of the fund has been increased several times, but the decision to allocate and disburse funds requires unanimous support. The EU Foreign Office has proposed:
“It is necessary to reach political agreement as quickly as possible on the proposed goal of increasing the overall financial ceiling of the EMF by 5 billion euros specifically earmarked for Ukraine.”
The proposal aims to reconcile the various positions by changing the management of the fund, including fixing reimbursement rates and providing a higher bonus for joint initiatives between European and Ukrainian industry.
Meanwhile, Politico reported on Friday that EU leaders are ready to deprive Hungary of its voting rights in the EU Council if Hungarian Prime Minister Viktor Orban blocks the approval of 50 billion euros in financial aid to Ukraine at the February 1 summit.
The publication notes that European diplomats, after many years of a soft approach to Budapest, made it clear that the “nuclear option” is removing Hungary from the voting process in the EU – it is no longer unthinkable if it jeopardizes the security of Ukraine, a candidate country for joining the European Union. Five European officials and diplomats said other countries in the bloc were ready to move against Budapest, a historic move for leaders who rely on cohesion and unanimity. One EU diplomat said, as quoted by the publication:
“If Orban again blocks the agreement (on the budget and 50 billion euros for Ukraine) at the February summit, invoking Article 7 to strip Hungary of voting rights could be a realistic option.”
As is known, Article 7 of the Treaty of European Union provides for the possibility of suspending the voting rights of a member state if it is found to be in serious breach of the fundamental principles of the EU. At the same time, according to the publication, some countries in Central and Eastern Europe are hesitant to invoke Article 7 because they fear that in the future they themselves may face similar scrutiny on rule of law issues.
On Friday, January 26, Reuters, citing an unnamed official, notedthat negotiations between EU countries on approving financial assistance to Ukraine worth 50 billion euros are complicated due to the “inflexible” position of Hungary on the eve of the summit.
According to the source, due to the fact that Hungary’s position “was not flexible on this issue,” “negotiations are becoming somewhat more difficult.” He added that among other EU member states that want to provide more aid to Ukraine, there is a growing level of disappointment with Hungary, and the alternative ideas of Hungarian Prime Minister Viktor Orban – for example, providing aid subject to unanimous approval annually – are not acceptable for other Member States:
“No EU member state wants to be in a situation where it has to go through a unanimity process to help Ukraine.”
Prime Minister Ukraine Denis Shmygal said that previously all 27 member states of the European Union agreed to support a four-year program for Ukraine for €50 billion Ukraine Facility and expects approval of the program on Wednesday: “On February 1, we expect the EU to approve a new four-year program to support Ukraine for 50 billion euros Ukraine Facility. Previously, we can say that all 27 members of the European Union agreed to support this program.”
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