In Brussels, European Union leaders are attempting to convince Hungarian Prime Minister Viktor Orban to join a proposal to provide stable funding to Ukraine. If Orban does not agree, the EU leaders are prepared to provide the cash to Kyiv without the participation of Hungary. The plan is to offer Ukraine 33 billion euros in loans and 17 billion euros in grants to cover their needs from 2024-2027. This funding is meant to aid Ukraine as they fight against Russia’s invasion and would come from the EU budget, providing Kyiv with more predictable funding than they have received in the past.
Since Moscow’s invasion of Ukraine in 2022, the EU has been assisting Ukraine through intergovernmental deals that require national approvals every year. This method is more costly and complex than funding through the EU budget. The stability of the four-year financing from the EU budget is crucial, especially given potential issues with financial assistance from the United States due to infighting in Congress.
To use the EU budget for this plan, all 27 member countries must agree. However, Hungary, which has close ties with Moscow, wants the ability to veto the disbursements every year. The other 26 EU countries have rejected Hungary’s demand, leading to a stand-off since December. The summit on Thursday is the final opportunity to reach a deal before reverting to the less predictable financing methods used previously.
Ukraine is expected to run out of cash for normal state functions in March, so time is of the essence for the EU to make a decision. In an effort to address Orban’s demands, the leaders will propose holding an annual debate on how the EU aid is spent by Ukraine, without giving Hungary the right to veto the funding.
The draft proposal for the Thursday meeting stated, “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.” It remains unclear if Orban will agree to this compromise. Orban’s ambassador to the EU expressed at a preparatory meeting on Wednesday that Budapest still wanted veto power.
($1 = 0.9249 euros)
(Reporting by Jan Strupczewski; Editing by Tom Hogue)
