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May 29, 2024

EU Leaders Seek Breakthrough on Ukraine Aid as Orbán Softens Stance

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Jan 31, 2024

Orbán Signals Willingness to Compromise Ahead of Key Summit

Hungarian Prime Minister Viktor Orbán has indicated he is ready to soften his stance blocking €18 billion in financial support for Ukraine ahead of a key EU summit this week, providing a glimmer of hope that a compromise deal can be reached.

Orbán has objected to the aid package, saying the EU’s plan to fund it through joint borrowing unfairly forces Hungary to subsidize the war effort against its will. His veto has frustrated other EU leaders who see continued robust support for Ukraine as critical at this phase of the conflict with Russia.

However, in recent days Orbán’s tone has shifted. His chief of staff Gergely Gulyás stated “there is a good chance” to make progress at the summit if Hungary’s concerns about the structure of the aid package can be addressed.

This slight softening comes as Orbán faces intense pressure from EU leaders. According to leaked documents, the European Commission had drafted radical plans to cut Hungary’s access to regional funding and even trigger a punitive procedure under Article 7 of the EU Treaty.

High Stakes as EU Seeks Unity Amid Conflict in Ukraine

The timing of the standoff with Orbán has raised the stakes heading into Thursday’s summit in Brussels. Over the past year, EU unity and determination has been crucial in maintaining staunch support for Ukraine against Russia’s invasion.

A failure to unlock the €18 billion in 2023 would deal a symbolic blow, even as member states have already provided Ukraine bilaterial assistance. It would also shift the dynamic ahead of further decisions on long-term support Ukraine will need to rebuild and develop its institutions.

Several EU officials have framed the summit as a critical juncture:

Official Comment
European Council President Charles Michel “Our unity, solidarity with Ukraine and the Ukrainian people are at stake”
German Foreign Minister Annalena Baerbock “We need quick progress here because every day counts for the people of Ukraine”
Lithuanian President Gitanas Nauseda “There is no time for internal disputes and disputes, unity must be ensured”

Meanwhile Russian state media is playing up divisions, with former president Dmitry Medvedev accusing the EU of “eating itself up from within.” China has also seized on the rift, with state newspapers arguing it shows Europe’s Russia policy being “taken hostage by eastern European countries.”

Paths Forward: Controversial Options Face Obstacles

If Orbán refuses to drop his opposition, the EU is exploring several paths to unlock the financing without Hungary:

Enhanced Cooperation: This allows a group of at least 9 member states to collaborate in areas outside EU structures using the EU budget. However others like Belgium warn isolating Hungary may set a dangerous precedent.

Intergovernmental Solution: Member states provide Ukraine the €18 billion through their own guarantees, bypassing EU structures and Hungary’s veto. But this approach also has significant political and technical hurdles.

Article 7 Proceedings: This allows the EU to suspend certain membership rights over breaches of rule of law. But actually deploying it requires unanimity minus the targeted state, which Poland may still block to defend its regional ally.

Rule of Law Conditions: The EU is already holding up €5.8 billion in pandemic recovery funds from Hungary over corruption concerns. Further leveraging these funds risks being seen as “blackmail.”

Budget Cuts: The European Commission was exploring cutting regional funds to Hungary by 70%, according to the leaked documents. However this idea was not further detailed and would be an escalation.

These controversial options underscore there are no easy options if Hungary refuses to agree to some form of compromise. But for now EU diplomats say the focus is still on negotiating with Orbán to keep external unity intact. No option will be forced through without broad consensus.

Deal Contours: What Might a Compromise Entail?

If Orbán follows through signalling increased flexibility, what could a compromise at the summit look like?

Most likely it would entail some adjustments to the structure of the aid package, such as:

  • Guarantees or options for member states to limit future joint EU borrowing through the fund.
  • Giving Hungary flexibility to provide its share through alternate channels like bilateral aid.
  • Modifying reporting obligations around the aid dispersal.

There is likely room for creativity in these procedural aspects. However Hungary agreeing to drop wholesale objections is still seen as more important for the initial unblocking.

The timing and format for dispersing future tranches will be another key variable. Less wealthy member states do want to avoid over-extension, so Orbán’s argument for greater national control of yearly budgets holds some logic.

Draft summit documents point to making the Ukraine funding an annual discussion topic, rather than pre-committing full amounts. This incremental approach may offer middle ground.

Fallout Regardless of Result

Whatever happens at the summit, relations between the EU and Hungary seem set for further turbulence.

If no agreement is reached, punished measures against Hungary lose appeal due to being politically divisive or legally questionable.

But EU officials warn leaving such defiance unaddressed risks encouraging similar behavior from other governments down the line. It also further erodes external credibility in defending democracy and rules.

Even if Orbán backs down for now, he has inserted uncertainty around long-term Ukraine financing. Germany and France reportedly pushed for a 6-12 month pre-commitment, but lost that fight early to Hungary’s pressure. This shortening of time horizons itself aids Russia’s goal of waiting out Europe’s resolve.

Most experts see Orbán using this rift to reinforce his credentials opposing EU overreach ahead of April elections in Hungary. This summit is likely to entrench “pole position against Brussels” as a durable plank of his political platform for years to come.

So while this week’s breakthrough would kick vital Ukraine funding into motion, Europe’s simmering ideological divides seem poised to enter a new chapter.

Conclusion

In conclusion, the way EU leaders navigate Hungary’s objections will have profound geopolitical implications. It will signal to Ukraine the durability of Europe’s economic backbone, but also to Russia the solidity of Europe’s political union.

Compromise may come on technical aspects of the aid package under debate. But reconciling the deeper discord around budgets, values and allegiances under the surface will likely prove far more elusive.

For Ukraine and eastern members like Poland and the Baltics, this rift threatens to further entrench doubts that western Europe fully grasps the gravity of the threat looming on NATO’s borders.

Yet for Orbán, the political incentives to position as a brake against Brussels are only set to grow stronger. Far from closing paths for other states to follow suit, this episode may lay fresh stones marking that route ahead.

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AiBot scans breaking news and distills multiple news articles into a concise, easy-to-understand summary which reads just like a news story, saving users time while keeping them well-informed.

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By AiBot

AiBot scans breaking news and distills multiple news articles into a concise, easy-to-understand summary which reads just like a news story, saving users time while keeping them well-informed.

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