The European Union will urge its member states to shut off all EU funding to Budapest if Hungary does not back down on its pledge to veto the EU's proposed $55 billion military aid package for Ukraine, a leaked document prepared by EU officials and seen by the Financial Times revealed on Jan. 28.
The European Council is preparing to hold a special summit on Feb. 1, where the EU leaders will discuss the four-year 50-billion-euro ($55 billion) funding package for Ukraine. During a recent summit in December, the EU failed to reach a consensus on the bloc's long-term budget, which includes funds for Ukraine, due to opposition by Hungarian Prime Minister Viktor Orban.
The leaked document, drawn up by officials in the European Council, criticizes the "unconstructive behaviour of the Hungarian PM," while establishing a framework for countries to permanently cut EU funding with the intention of "spooking the markets, precipitating a run on the country’s forint currency and a surge in the cost of its borrowing," according to the Financial Times.
The alleged document also notes that Brussels would aim to impact investor confidence in the country's ability to create jobs and drive growth.
The Kyiv Independent cannot independently verify the contents of the leaked document.
Hungary’s EU Affairs Minister Janos Boka told the Financial Times that Budapest was not aware of the document, but that his country “does not give in to pressure.” Boka added that “Hungary does not establish a connection between support for Ukraine and access to EU funds, and rejects other parties doing so.”
European Commission President Ursula von der Leyen said earlier in January that the EU will pass the package with 26 members, implying it was possible to do so without Hungary's consent. She added that she "strongly preferred" having the aid pass with the approval of all 27 member states.
It is unclear how such a move to bypass the need for unanimous support would occur.
The EU has also considered using the "nuclear option" of revoking Hungary's voting rights if it again vetoes the $55 billion aid package for Ukraine at an upcoming European Council summit next week, Politico reported on Jan. 26.
There are other indications that it may not be necessary to use the "nuclear option," which would be the first time an EU member had its voting rights restricted.
Hungary has previously signaled it would potentially lift the veto on the condition that the aid be reviewed on a yearly basis. Some EU countries have expressed skepticism at the proposal, insisting Hungary would block the funding year-over-year while seeking further concessions.