EU leaders meeting in Brussels on Thursday (1 February) are likely to propose holding an annual debate on a planned €50 billion Ukraine aid package, but without the possibility of a yearly veto, in a bid to overcome opposition from Hungary, according to draft summit conclusions.
EU leaders are set for a make-or-break summit in Brussels to try to get Hungary’s Prime Minister Viktor Orbán to drop his opposition to the desperately needed funding for Ukraine after he prevented a decision at a summit in December.
In recent weeks, EU officials have been trying to thrash out a compromise with Hungary to get an agreement on the four-year package for Ukraine as part of a broader overhaul of the bloc’s budget.
In the latest version of the draft summit conclusions, seen by Euractiv, EU leaders are expected to say they could hold yearly debates on how the EU money is being spent by Ukraine, based on reports by the European Commission.
“The European Council will hold a debate each year on the implementation of the facility with a view to providing guidance on the EU approach towards the situation stemming from Russia’s war of aggression against Ukraine,” states a new version of the text, which emerged from a meeting of EU ambassadors on Wednesday.
This would not give Hungary a veto right, but could present an olive branch towards Budapest, which has requested to have a mechanism to voice its concerns.
Over the past few months, Budapest has been pushing for such an option, with Orbán saying he would give his approval if he is given the chance to impose a veto each year.
However, as this goes against the idea of predictable funding for Ukraine, EU counterparts have called that a “red line” they are not willing to cross.
They instead proposed only an annual “debate” on the subject, which EU diplomats say is the maximum concession they would be willing to make to secure a deal at EU27.
It remains unclear if Orbán, who will take part in Thursday’s summit, will agree to such a deal.
On Wednesday, Hungary’s EU ambassador told his counterparts Budapest still wanted the veto mechanism.
According to EU diplomats, Budapest also does not wish to contribute to higher servicing costs of joint EU borrowing for the recovery fund, arguing it had still not received its EU funds, withheld over concerns about the rule of law in the country.
As Hungary’s recovery funds remain frozen and the scheme runs out in 2026, Budapest has also requested to extend the life of the programme by two years until 2028.
EU diplomats and officials argue that neither an exemption from contributing to higher interest costs nor an extension of the recovery fund programme is legally possible.
Should Orbán refuse to drop his veto on Thursday, and given that most EU countries have voiced their preference for a solution at EU27, including Hungary, EU diplomats have started to signal they are more willing to move towards a solution at EU26, outside the EU budget, to secure Ukraine funds.
“If a solution at 27 is impossible, then we will have to move at 26,” one EU diplomat said on Wednesday.
Such an option would be more expensive complex, and more politically challenging, but still possible, using the same method the EU employed to pay out €18 billion to Kyiv in 2023, EU diplomats said.
This would require the remaining EU26 to set up two separate intergovernmental schemes to allow the bloc to transfer grants and loans to Ukraine for the rest of the period.
A failure to adopt the Ukraine aid package unanimously would also throw in doubt the prospects for adopting an additional €4 billion for migration and defence, which is part of a broader EU budget review, by EU27 leaders.
[Edited by Zoran Radosavljevic]
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Source: euractiv.com
