Balkans | Hungary vetoes EU financial aid to Ukraine

Opposing the EU as a whole to provide financial support to Ukraine and jointly borrow for this purpose, Hungary argues that each member state should help Ukraine according to its own capabilities.

Hungary rejected the EU countries’ package to provide 18 billion euros in financial aid to Ukraine for next year.

Finance ministers from 27 European Union member states met in Brussels.

On the agenda of the meeting are the funds to be provided to Hungary within the scope of the binding mechanism of the EU budget on condition of the rule of law, the assessment of the Hungarian bailout, the €18 billion financial support package for Ukraine for 2023 and the application of a global minimum corporate tax of 15% for multiple companies. Nationalities, there were different addresses.

At the end of the meeting, Zbenik Stanjora, Minister of Finance of the Czech Republic and the Presidency of the European Union, announced that the package, which includes financial support of 18 billion euros for Ukraine next year, had not been approved.

Noting that the package required unanimously by the EU countries could not be accepted, Stanjura stated that they had started working on a solution that overcame the Hungarian veto and had the support of 26 member states.

Stangora stated that they maintained their goal to start financial support to Ukraine in January.

After Hungary vetoed the aid package to Ukraine, the ministers removed the issue of financing Hungary from the agenda of the meeting. Thus, the European Union countries postponed their decision to send money to Hungary.

The global corporate tax issue, which Hungary opposes, was also not discussed at the meeting. The tax treaty requires that global corporations be subject to a minimum tax rate of 15% from 2023.

Hungary was to receive a €5.8 billion grant from the EU’s recovery funds, which were set up to combat the economic consequences of the COVID-19 outbreak.

Hungary will lose money if EU countries do not agree to the bailout program this year. The €7.5 billion coordination funds, which Hungary is expected to receive from the EU budget, have been frozen due to the rule of law mechanism. Member state approval is required to release this resource.

The EU expects progress from Hungary in releasing funds in various areas such as judicial independence, spending control, anti-corruption and reporting.

Opposing the EU as a whole to provide financial support to Ukraine and jointly borrow for this purpose, Hungary argues that each member state should help Ukraine according to its own capabilities.