© Getty Images The decision to grant a loan requires unanimity among the 27 EU member states.
Hungary has put a stop to a €90 billion EU credit line for Ukraine , previously sanctioned by the European Parliament the week before. In the absence of this credit, Ukraine will encounter a fiscal shortfall during the second trimester, the Financial Times reports .
The Hungarian EU representative lodged an objection last Friday against issuing debt guaranteed by the EU’s financial plan, according to four sources with knowledge of the situation. The authorization of the loan necessitates a unanimous agreement among the EU’s 27 member nations.
The publication emphasizes that Hungary, Slovakia, and the Czech Republic had earlier consented to assist Ukraine, but only under the stipulation that they bear no responsibility for interest payments or loan repayment. These costs would be assured by the remaining 24 EU countries. Nevertheless, a unanimous verdict remains crucial for the European Commission to utilize the designated EU budget reserve to secure borrowing and extend loans to Ukraine.
This action unfolds as Hungary gears up for its April elections, where Prime Minister Viktor Orban might face a setback. Public opinion surveys indicate that the opposition party, Tisza, spearheaded by Peter Magyar, holds a lead of roughly 10 percentage points over Orban’s Fidesz party.
To reiterate, on February 11, the European Parliament endorsed three pieces of legislation that would enable Ukraine to secure a 90 billion euro credit for the period spanning 2026 and 2027. From this loan, 30 billion euros are earmarked for macro-financial assistance, or budget backing, facilitated through the EU Mechanism for Ukraine. An additional 60 billion euros are aimed at reinforcing Ukraine’s defense capabilities and bolstering the procurement of military hardware and defense resources from the defense sectors of Ukraine, the EU, and the European Economic Area.