EU unlocks Hungary funding on eve of Ukraine summit

The EU released €10.2 billion of funding for Hungary on Wednesday (13 December), the eve of a summit on support for Ukraine that Hungarian Prime Minister Viktor Orbán has threatened to derail.

The European Commission insisted Hungary had undertaken measures to improve the judiciary’s independence, therefore meeting the requirements to access the money.

Although the green light had been expected, it quickly sparked outrage, with EU lawmakers accusing the commission of giving in to Hungary’s “blackmail”.

It is, however, far from clear that Brussels’s gesture will avert a dispute between the EU leaders.

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It will be the million-euro-question when EU leaders gather in Brussels on Thursday for the toughest summit of the year: What is it that Hungary’s Prime Minister Viktor Orbán really, really wants?

The leaders will be in Brussels from Thursday to discuss renewing their support for Ukraine, with a macroeconomic package of €50 billion and the start of EU accession negotiations with Kyiv on the table.

Orbán has threatened to veto both measures, which would condemn the summit to failure and leave Ukraine — and its neighbour Moldova, also hoping for membership talks — out in the cold almost two years after Russia launched an all-out invasion of Kyiv’s territory.

Hungary insists it has principled objections to Kyiv’s move for membership, arguing that President Volodymyr Zelenskyy’s wartime administration has not done enough to fight corruption.

Budapest is demanding a “strategic discussion” on ties with Kyiv before any decision.

#Ukraine’s swift accession to the European Union would have devastating consequences for European #farmers, the EU’s budget and European security. It serves the best interests of neither Hungary, nor the European Union, therefore we cannot support it! #EUCO pic.twitter.com/ddgKSPEqsX

— Orbán Viktor (@PM_ViktorOrban) December 13, 2023

But many in other EU capitals suspect that Orbán is exploiting the summit and the power of his veto on enlargement to blackmail Brussels into resuming Hungary’s suspended transfer payments.

EU officials have denied the latest move was to appease Orbán.

Under the right-wing authoritarian nationalist, Hungary stands accused of breaching EU standards of democracy and the rule of law, and tens of billions of euros in funding are blocked.

‘Disastrous signal’

“Von der Leyen is paying the biggest bribe in EU history to the autocrat and Putin-friend Viktor Orbán. The signal is disastrous: Viktor Orbán’s blackmail pays off,” German MEP Daniel Freund said on social media.

The chiefs of the parliament’s four groups wrote a letter to commission head Ursula von der Leyen to oppose the funds’ release, noting that the conditions had “not been fulfilled”.

Members of🇪🇺Parliament *furious* with 🇪🇺Commission releasing these funds to Hungary, one calling it "the biggest bribe in EU history"

National governments in🇪🇺Council are insisting they have nothing to do with this and they "trust" the Commission's coincidentally-timed decision. pic.twitter.com/RN7i3JzaID

— Dave Keating (@DaveKeating) December 13, 2023

Criticism was not just limited to the parliament.

“The European Commission cannot claim to uphold democracy in the EU if it is not serious about sanctioning those that breach its values,” Vitor Teixeira of Transparency International, said.

“Today’s decision sends the opposite signal: that destruction to democratic society can go unpunished if mere cosmetic reforms are undertaken,” Teixeira said.

In December 2022, the EU suspended a total of around €21.7 billion of cohesion funds planned for Hungary for the period 2021 to 2027, pending the completion by Budapest of a certain number of reforms.

Hungary did carry out some judicial reforms aimed at restoring the power and independence of the National Judicial Council and limiting the government’s ability to challenge court rulings.

These measures came into force in June.

Meanwhile, around €11.7 billion would remain frozen pending progress regarding conditions for awarding public contracts, protecting academic freedom, ensuring the rights of LGBTQ people and accepting migrants’ right to claim asylum.

In a separate procedure, the EU has suspended a further €10.4 billion designed to fund Hungary’s post-Covid recovery plan, pending more reforms.