The EU is considering an alternative financing plan for Ukraine in case Hungary vetoes the currently proposed €50 billion in aid.
According to Bloomberg sources, the EU has decided to draw up a contingency plan so as not to be dependent on Viktor Orban in providing financial support to Ukraine.
It provides for the provision of guarantees by Member States to raise the necessary resources on the capital market. In this way, Brussels will be able to obtain money if Hungary blocks the approval of the Ukrainian financing package for 2024-2027.
Will Brussels release funds for Hungary?
Orban is postponing the decision on this issue, calculating, among other things, that the EU will release part of the 22 billion euros allocated to Hungary from the EU budget. These funds have been frozen because the European Commission accuses the authorities in Budapest of failing to respect the rule of law and insufficient protection of human rights, and demands reforms.
Orban has already announced that he will not agree to an increase in the EU general budget (largely necessary to guarantee payments to Ukraine) due to the suspension of the payment of funds intended for his country. A month ago, Hungarian representatives said that 25 billion euros is enough for Ukraine for the time being, and that in two years it will be possible to reassess its needs.
According to Bloomberg, Orban’s government wants to assess the size of aid, its effectiveness and risk factors such as corruption in Ukraine. The agency noted that some EU countries are in favor of finding an alternative option to provide financial support to Kiev in order to put pressure on Hungary.
First estimates of Ukraine’s possible admission to the EU
The Financial Times wrote in early October, citing internal European Commission estimates, that Ukraine’s accession to the EU will raise Kiev around 186 billion euros over seven years, making many member states net contributors for the first time.
As “FT” highlights, Ukraine would be eligible, among other things: to receive EUR 96.5 billion from the EU’s Common Agricultural Policy. According to estimates by EU officials, this change would reduce agricultural subsidies for existing member states by around 20%.
Ukraine would also be entitled to €61 billion from EU cohesion funds, which aim to improve infrastructure in poorer member states. At the same time, the Czech Republic, Estonia, Lithuania, Slovenia, Cyprus and Malta would lose the right to use these funds.
Source: Do Rzeczy
Roy Brown is a renowned economist and author at The Nation View. He has a deep understanding of the global economy and its intricacies. He writes about a wide range of economic topics, including monetary policy, fiscal policy, international trade, and labor markets.
