Hungary and Poland are giving up their fiscal veto; great news but be careful for now

HUNGARY - In Brief 09 Dec 2020 by Istvan Racz

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Today's obviously great news was the announcement of an agreement between the EU's German Presidency and Hungary / Poland on the latter two members' intended fiscal veto. The two governments are prepared to give up their intention to veto the EU's fiscal package, in exchange for three concessions made by the the EU (essentially by donor countries):- the list of possible reasons for which the new conditionality mechanism can be activated would be limited to factors which directly have to do with the EU's financial interests, and the conditions would be more exactly defined (actually an explanatory attachment would be issued);- whenever the EU Commission proposes the activation of the mechanism, the targeted member would have a right to take the issue to the European Council's summit; and- the effective introduction of the mechanism would be postponed until the European Court decides if it is in line with EU law.The agreement, if it goes through the European Council summit meeting over the next two days and the European Parliament also endorses it, would create a win-win situation: it would give a last-minute go ahead to the EU budget, instead of a much smaller emergency budget, the recovery package could be launched as well, and Hungary and Poland would not be left out of the latter. Yes, donor countries could not activate the conditionality mechanism immediately, and yes, Hungary and Poland, against which the mechanism has been invented in the first place would have to learn to live with the existence of the latter. But at least PM Orbán would most probably stave off the risk of losing lots of EU funds and running into a humiliating defeat in EU politics before the 202...