of the European Union Leaders are meeting in Brussels on Thursday to try to strike a deal with Hungarian Prime Minister Viktor Orban, who is blocking a multibillion-euro fund aimed at securing Ukraine’s funding for years to come.
Talks are deadlocked and the mood towards Mr Orban is negative, with European leaders, unusually united against one of their peers, fed up with his stance on Ukraine and his anti-European rancor.
What’s at stake?
50 billion euro ($54 billion) fund to support Ukraine until the end of 2027.
Ukraine is facing one of its toughest times since Russia’s full-scale invasion nearly two years ago, with US aid lagging and virtually no progress on the battlefield.
Kyiv urgently needs new cash to keep essential services running. EU aid, to be provided in the form of loans and grants over the next four years, will cover both immediate needs and allow Ukraine to plan its long-term budget.
This money is part of ancillary funds, still under negotiation, to supplement the EU budget and pay for things like emergency response to natural disasters. If there is no agreement on funding for Ukraine, other parts of the budget will also be delayed.
Broader issues are at stake. If EU leaders fail to agree on long-term support for Ukraine, it could undermine the bloc’s credibility. And a final break for Ukraine could be difficult to recover from, furthering Hungary’s isolation.
Why is Hungary blocking the deal?
Mr Orban has weakened or suspended most EU decisions related to Ukraine, including sanctions against Russia, which require the unanimous support of all 27 EU countries.
President Vladimir V. Putin’s closest — and perhaps only now — ally in the EU, Mr. Orban says he believes Russia poses no threat to Europe.
Critics say Mr Orban is simply trying to extend his power. The aim, they say, is to use Hungary’s veto as leverage to unfreeze billions of euros in delayed EU funding on Hungary’s violations of EU rules.
Why is the EU-Hungary relationship so bad?
The EU and Hungary have long clashed over policies on the rule of law, corruption and minority rights, but their relationship has hit rock bottom since the outbreak of war in Ukraine two years ago.
The European Commission, which enforces EU rules, believes Mr Orban’s policies at home have eroded democratic protections and that he has diverted EU funds to benefit himself and his allies. Punished Hungary by freezing money it would normally receive—and desperately needs—from the EU
Mr Orban and his officials reject the criticism and say the EU is trying to impose liberal Western values on Hungary that run counter to his vision of his nation’s conservative Christian identity.
Can the EU change Mr Orban’s mind?
Mr Orban’s EU partners have pledged a robust annual review of how money given to Ukraine is spent, but say they will not grant its request for an annual vote in Hungary.
If Mr Orban is really seeking access to frozen EU funding, that seems unlikely.
At the end of last year, the Commission concluded that Hungary had implemented judicial reforms and unfrozen €10 billion. But he said he would continue to withhold the rest, 20 billion euros, because other issues remained unresolved.
While EU officials said the timing of the decision was fortuitous, it came just before EU leaders formally began talks that could lead to Ukraine joining the bloc. Mr Orban had said he would veto such a move, but this time he walked out of the room when the decision was being made, effectively abstaining.
A repeat of this scenario on Thursday is highly unlikely. The Commission has made it clear that it believes that Hungary has not made new progress that would justify the release of more than the committed funds.
What is the best case scenario?
Mr Orban and EU leaders may still find room for compromise on the details of how Ukraine’s fund will operate. Hungary could, for example, be given a financial incentive in the form of a suspension from the small contributions it makes to the EU budget.
This will allow the EU to provide Ukraine with predictable long-term financing. The rift with Mr Orban would be set aside. And leaders could focus on winning to get all EU member states back from Ukraine at a critical time.
What if Mr. Orban doesn’t get on board?
If the talks break down and no fund is announced for Ukraine, EU leaders will be forced to go home and figure out what to try next.
One option is to launch a special fund for Ukraine approved by 26 member states, leaving Hungary out.
This is burdensome and risky, and requires the approval of each government and in some cases parliamentary votes. And it would prolong the uncertainty over Ukraine’s funding and put the division front and center, just what Mr. Putin wants.
A nuclear option would be for the 26 EU states to start a fund for Ukraine without Hungary, legally stripping it of its vote. It is a time-consuming process that has never been used and would drastically escalate the rift between Mr Orban and the rest of the bloc.
This option seems unlikely, as most EU countries are against it.
