EU Plans Economic Retaliation if Hungary Blocks Financial Aid to Ukraine

Written by Henrik Rothen

Jan.29 - 2024 10:27 AM CET

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Photo: lev radin / Shutterstock.com
Photo: lev radin / Shutterstock.com
EU Plans Economic Retaliation if Hungary Blocks Financial Aid to Ukraine.

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The European Union is reportedly prepared to take economic retaliatory actions against Hungary if Budapest obstructs the provision of new aid to Ukraine at this week's European Council summit.

This confidential strategy, outlined by Brussels and cited by the Financial Times, was highlighted by Reuters on Monday.

The accessed document suggests that if an agreement is not reached by February 1, the EU aims to target Hungary’s vulnerabilities. The plan includes targeting job markets, the national currency, and the country's development.

Brussels has even outlined a strategy to explicitly target Hungary’s economic weaknesses, destabilize its currency, and trigger a collapse in investor confidence. This aggressive approach aims to impact Hungary's labor market and development, should Budapest persist in refusing to lift its veto on aid for Kiev.

The Financial Times report, citing an EU officials' document, stated that in the absence of an agreement by the deadline, other heads of state and government would "publicly declare that, in light of the Hungarian Prime Minister's unconstructive behavior, it is unthinkable for the EU to provide funds to Budapest."

Hungarian Minister for European Affairs, Janos Boka, told the newspaper that Budapest is not aware of such financial threats but stated that Hungary "will not yield to pressure."

Hungarian Prime Minister Viktor Orban had dropped his veto in the European Council in December against starting Ukraine's EU accession negotiations. However, he blocked a €50 billion EU financial aid package for Ukraine for the next four years.

This decision came amid Budapest's tensions with Kiev over the rights of the Hungarian minority in the Transcarpathia region and the European Commission's freezing of European funds to Hungary, whose government is accused by Brussels of violating the rule of law.

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