Hungarian veto on the EU's €50bn aid package to Ukraine has been withdrawn with unexpected ease today

HUNGARY - In Brief 01 Feb 2024 by Istvan Racz

---

Quite unexpectedly, but very positively from investors' point of view, today's extraordinary EU summit ended with a deal accepted by all member states, that means also by Hungary, in just a few hours after its start. Effectively, member states approved the original December proposal to provide Ukraine with a €50bn aid package in grants and loans over the 2024-2027 period, from within the EU's common budget, with a few relatively minor changes. The latter included the preparation of an annual report, based on which the EU Council will hold a debate on the use of the facility and on the potential need of its amendment. In addition, the EU Council will ask the European Commission to prepare a proposal on the potentially needed amendments of implementation regarding the facility after two years. However, decision on these matters will not grant a veto right to member states as Hungary originally proposed. Following the meeting, PM Orbán said that in the last hours before the meeting, Hungary received a proposal they could accept. Guarantees had been given that the money will be used reasonably and that the blocked part of Hungary's grant and credit quota will not be used up for the support of Ukraine. However, there is no sign at all that Hungary would have got any closer to the EU unblocking the currently frozen part of Hungary's cohesion policy and RRF quota. There is one minor item, although a long time demand from Hungary, that the EU spend an extra €2bn on the compensation of member states' cost attached to the handling of illegal migration and related border control. Hungary will likely get up to €300m from this extra fund, as compensation for the costs of the fence ...