EU Has "Plan B" If Hungary Vetoes Eur 50 Billion in Aid to Ukraine

Friday, 10 November 2023

Sources within the European Union say that the EU will be able to bypass any Hungarian veto and provide Ukraine with EUR 50 billion in aid.

The European Commission has proposed expanding budget support to help Ukraine pay salaries and cover other costs. The 27 EU member states are due to vote on the package at a summit on 14-15 December.

However, some fear the aid could be blocked by Hungarian Prime Minister Viktor Orbán, who maintains close ties with Moscow and has objected to such support in the past. Such payments out of the common EU budget require the unanimous support of all member states.

Two EU officials have said that if Budapest does use its veto, the EU has a way around it by asking each of the other EU governments to come up with their own aid package for Kyiv. Together, the bilateral packages will amount to the same amount of EUR 50 billion.

"Hungary risks overstretching its luck. We'd prefer to have them on board but there comes a point when people get fed up with Budapest holding everyone hostage. The workaround is tiresome but we have it if need be," Reuters cited one EU official as saying.

A second EU official, who also spoke to Reuters anonymously, agreed with him. "The issue of money for Ukraine will be solved one way or another, Kyiv will get EU support," the official said.

"If Hungary becomes an obstacle to the needed unanimity to do it via the EU budget, member states will find another way, like an intergovernmental agreement or national guarantees," that official said.

Last year, Hungary vetoed a similar proposal to provide Ukraine with EUR 18 billion in financial aid in 2023.

After months of wrangling, Budapest agreed to the package after securing what it said were concessions from the European Union on aid to Hungary.

Asked whether the EU would go down that road again if Hungary blocked aid, European Trade Commissioner Valdis Dombrovskis said at a press conference on 9 November: "Last year, we were indeed discussing 'Plan B'... But we were able to avoid this scenario last year. I hope we will also be able to avoid this scenario this year."

Bloomberg reported on 10 November that an alternative proposal would include national guarantees of member states to attract financing in the markets if Budapest blocks the review of the EU's long-term budget, which includes aid to Ukraine.

Last month, the Financial Times reported that high-ranking EU officials are considering unfreezing about EUR 13 billion to Hungary of the EU funds currently blocked due to unresolved rule of law issues.

This move should encourage Budapest to agree to increase the EU budget for 2024-2027, including the allocation of EUR 50 billion for Ukraine for this period, the FT says.

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