Hungary Open to Lifting Ukraine Aid Veto If EU Unfreezes Funds

(Bloomberg) — Hungary is prepared to lift its veto on a massive European Union funding proposal for Ukraine in return for billions in financing the bloc has been withholding from Budapest over democratic backsliding, Prime Minister Viktor Orban’s chief political adviser said.

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The government in Budapest is holding up a four-year €50 billion ($54 billion) support package for Kyiv that would start next year as part of a broader fight over the EU’s budget at a meeting of leaders starting Thursday. The remarks from Balazs Orban, who’s unrelated to the premier, suggest Hungary is seeking to extract a heavy price for its consent that may be hard for the rest of the bloc to accept.

“Hungary’s EU funding and Ukraine’s financing are two separate issues,” Balazs Orban, who serves as the premier’s political director, told Bloomberg in an interview on Tuesday. “But if the EU insists that Ukraine’s financing should come from an amended EU budget, then the two issues become linked.”

He also said that Hungary remains opposed to a full four-year aid plan and would prefer the EU offer financing to Kyiv for a single year with no amendments to the budget. Budapest would also “consider contributing” to the package, he said.

Budapest is raising the stakes just as the EU is expected to release about €10 billion of financing by Wednesday after the government passed laws to strengthen the court’s independence.

But Orban said he wants the the EU to hand over the full amount — around €30 billion — that was suspended last year on rule of law and graft concerns. As it stands now, that rest is to remain suspended until the country meets almost two dozen other demands, from ensuring academic freedom to protecting LGBTQ and asylum rights.

As part of the bargaining over aid to Ukraine, Hungary would consider an EU proposal to boost financing for border protection — a recurring demand from Budapest — as well as additional EU subsidies to make the bloc’s economies more competitive, Balazs Orban said.

Read more: Hungary Floats Splitting Ukraine Aid After US Cash Is Blocked

The EU money is crucial for Kyiv, which is trying to shore up western support to continue funding its counter-offensive against invading Russian forces. Until now, Hungary has blocked all issues related to Ukraine, clouding the prospects for an agreement at the summit. Premier Orban has twice written to the head of the European Council, urging him to drop Ukraine membership talks from the agenda of the summit.

Orban’s close relationship with Russian President Vladimir Putin and the Kremlin even after the invasion of Ukraine has triggered scathing criticism from EU and NATO allies.

Ukraine membership in the EU remains a “red line” for Budapest, Balazs Orban said. He said the EU should offer a strategic partnership because Hungary considers that Ukraine hadn’t met the criteria to start membership. The government wants the EU to postpone the opening of accession talks to avoid sending a negative signal to Ukraine, he said.

“Sending a negative signal to Ukraine is the opposite of what Hungary wants,” Balazs Orban said.

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