EU Mulls Hungary Payout on Eve of Ukraine Summit

Brussels is expected to unlock 10 billion euros in EU funding for Hungary on Wednesday,  Dec. 13, the eve of a summit on support for Ukraine that Hungarian Prime Minister Viktor Orban has threatened to derail.

The European Commission can expect to be accused of backing down in its standoff with Orban, and it is far from clear that the gesture will avert a dispute between leaders.

EU leaders will be in Brussels from Thursday to discuss renewing their support for Ukraine, with a 50-billion-euro macroeconomic package of 50 billion euros ($54 billion) and a promise of formal membership talks on the table.

Orban has threatened to veto both measures, which would condemn the summit to failure and leave Ukraine -- and its neighbour Moldova, also hoping for membership talks -- out in the cold almost two years after Russia launched an all-out invasion of Kyiv's territory.

Hungary insists it has principled objections to Kyiv's move for membership, arguing that President Volodymyr Zelensky's wartime administration has not done enough to fight corruption.

Budapest is demanding a "strategic discussion" on ties with Kyiv before any decision.

But many in other EU capitals suspect that Orban is exploiting the summit and the power of his veto on enlargement to blackmail Brussels into resuming Hungary's suspended transfer payments.

Under the right-wing authoritarian nationalist, Hungary stands accused of breaching EU standards of democracy and the rule of law, and tens of billions of euros in funding are blocked.

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But, according to sources close to the debate, Brussels will unfreeze around 10 billion euros -- just under half the blocked funds -- on Wednesday.

This, the European Commission will argue, is not to appease Orban after his summit threat but because Hungary has responded to some of its concerns.

Vera Jourova, vice president of the European Commission for Values and Transparency, said Brussels had received its final set of answers from Hungary under a mechanism to impose rule of law conditions on economic cohesion funds.

"Now as we speak, the commission is doing the final work on the assessment, so that the decision can be taken. I will not tell you of how the decision will look like at this moment," she said.

Jourova would not go further, but officials speaking on condition of anonymity predicted that the funds would be unfrozen -- and human rights defenders and members of the European Parliament expressed dismay that Orban appears to be getting his own way.

MEP Stephane Sejourne, president of the liberal block Renew Europe, said: "We are against the release of any European funds for Hungary. We have no guarantee that there will be a return to sustainable democracy in Hungary.

"The future of the European Union, Ukraine and Moldova cannot be held hostage by one man," he said of Orban.

- Final questions -

"A bad decision that will be regretted," Marta Pardavi, co-chair of the Hungarian Helsinki Committee on human rights, said in a social media post. "Won't bring more freedom for Hungarians but will bring less freedom for Ukrainians."

In December 2022, the EU suspended a total of around 21.7 billion euros of cohesion funds planned for Hungary for the period 2021 to 2027, pending the completion by Budapest of a certain number of reforms.

Hungary did carry out some judicial reforms aimed at restoring the power and independence of the National Judicial Council and limiting the government's ability to challenge court rulings. These measures came into force in June.

This could allow, a Brussels source told AFP, around 10 billion euros to be restored to Hungary, starting with a down payment of 500 million, once the "final questions have been resolved".

Brussels is still waiting for Hungary to enact further legal changes to the relations between national courts and European courts.

Meanwhile, around 11.7 billion euros would remain frozen pending progress regarding conditions for awarding public contracts, protecting academic freedom, ensuring the rights of LGBT+ people and accepting migrants' right to claim asylum.

In a separate procedure, the EU has suspended a further 10.4 billion euros designed to fund Hungary's post-Covid recovery plan, pending more reforms.