European Union leaders meet this Thursday in a high-voltage summit with one primary objective on the table: to persuade Hungarian Prime Minister Viktor Orban to lift his veto on much-needed financial aid for Ukraine. In the words of the president of the European Council, Charles Michel, the “credibility” of the bloc is at stake.
The heads of state and government of the EU will today seek an agreement to unlock 50 billion euros in aid to Ukraine for the next four years, after weeks of negotiations that have not served to end Hungary’s veto.
Failure would deal a blow to Kyiv and fuel doubts about its allies’ commitment to the war against Russia’s invasion, particularly at a time when US aid remains stalled in Congress.
In December, Orbán’s ultranationalist government blocked the pact to which the other 26 countries of the bloc had given their approval, which led to calling an extraordinary summit in which there are only two options: either reach an agreement endorsed by Budapest or with a solution that allows funds to be channeled to Kyiv without its support.
“We are not there yet. We have seen some movement from Hungary in certain parts of the negotiations but it is still difficult,” a senior European official admitted to EFE, warning that “frustration is increasingly high” among the rest of the State.
Hungary, which in December linked its support for the Ukrainian aid package to the unlocking of the 21 billion euros in funds that Brussels keeps frozen due to attacks on the rule of law in Budapest, rejects including aid to Kyiv in the EU’s multiannual budget and asks to extend beyond 2026 the deadline to use the recovery funds to which it currently does not have access.
However, in recent days he has opened up to including assistance to Ukraine in the budget as long as the aid is approved annually unanimously, which would give him the right to veto in the future.
The rest of the partners reject it, since the annual budgets only require a qualified majority to move forward, but several European sources admit that ways have been explored so that the Twenty-Seven can, under certain circumstances, review disbursements to Kyiv.
The last proposal that is on the table proposes holding an annual debate on the implementation of aid, something that the rest of the States could support with the “red line” that the decision be by majority, not unanimity. “It is clearly a hand extended to Hungary,” a diplomatic source told EFE.
However, the priority option, the capitals agree, remains a unanimous agreement and within the multi-year budget, since it would be easier and faster to approve than a solution to 26 outside the accounts and would give more stability and predictability to Kyiv, which will have liquidity problems in March if it does not receive funds.
In case everything goes wrong and it is impossible to reach an agreement, European officials admit that a plan B is being studied. The alternative without Orbán, although more complex and limited, would involve disbursing ‘bridge’ financing to Kyiv in 2024 with new emissions of debt guaranteed with the margin left in the community budget, while the 26 countries prepare a mechanism until 2027 that works with national guarantees and that would take several months to be prepared.
“Many member states see the issue of the war in Ukraine as existential and that is the level of frustration, which is why they look at all scenarios,” European sources point out. “If Ukraine fails and Russia feels strengthened, it will try to attack other countries,” European Commission Vice President Valdis Dombrovskis warned Tuesday in Washington. “That would just mean a much bigger war with NATO.”
Orbán has angered his EU counterparts by hindering a pillar of Europe’s security strategy aimed at containing Russian President Vladimir Putin. For his part, the Hungarian leader has accused the EU of “blackmail” for the leak of an alleged plan to undermine his economy if he does not give the green light to aid, although the community institutions have assured that it is only a “document factual” on the situation of the Hungarian economy.
Various diplomatic sources deny any type of blackmail against Hungary, political or with European funds, although they recognize that some countries have suggested advancing the file for violations of the rule of law opened to Budapest years ago, which could withdraw its right to vote.
At today’s meeting, leaders will also discuss military aid to Ukraine, particularly the future of the European Peace Facility given the decline in national ammunition stocks. European leaders will discuss whether to allocate another €5 billion to the fund, which has been used to finance arms donations to Kiyv.
EU members have been arguing for months about the future of the fund’s role in military aid to Ukraine, and Germany suggested that attention should now focus on bilateral aid from individual countries. The head of European diplomacy, Josep Borrell, admitted on Wednesday that the EU would fall far short of its goal of sending one million artillery shells to Ukraine by March. For its part, Hungary has stepped up criticism of the EU’s military support for Ukraine and has in the past withheld hundreds of millions of euros in payments from the fund.
Ukraine is running out of weapons as the Russian invasion enters its third year. Reports from the front suggest Kyiv is struggling to contain Russian forces amid a dispute between President Volodymyr Zelensky and his commander-in-chief Valeriy Zaluzhny, adding to the sense of crisis. Ukrainian Defense Minister Rustem Umerov sent a stern warning to his EU counterparts this week, warning that his country’s forces are outgunned by Russian forces by three to one. In the letter, seen by Bloomberg, he added that Kyiv needs at least 6,000 artillery shells a day, but cannot fire more than 2,000 along a 1,500-kilometer front.
