EU | Hungary blocked Ukraine’s 18 billion aid package – Saarikko characterizes the end result as embarrassing

EU countries the finance ministers’ meeting ended on Tuesday in a situation where both Hungary and Ukraine were left hanging from a loose gallows. The multibillion-dollar decisions concerning both countries were moved further into the future, to an unknown moment.

An agreement on Ukraine’s 18 billion euro loan package should be reached quickly, but this decision was blocked by Hungary on Tuesday. The reason is that the finance ministers also have the decision to freeze Hungary’s EU money at the same time.

“For a reason beyond our control, all these matters of the meeting were actually connected to each other. And that connection was made by Hungary, the finance minister Annika Saarikko (Central) said after the meeting.”

In his press conference in Brussels, Saarikko characterized the situation as embarrassing.

“We are committed to assisting Ukraine and these aid decisions are very urgent,” he said.

The member states should reach a unanimous agreement on Ukraine’s aid decision, but not on the freezing of Hungary’s EU funding. However, the possible freezing of Hungary’s funding would also have to be decided by December 19.

The meeting expectations were fully met, because the most important decisions were not made. The final result could already be guessed from the preliminary information that oozed during the meeting.

“When we couldn’t find an agreement on the way in which Hungary could get funding for these stimulus package plans or cohesion funding, there was no possibility to make a decision about assisting Ukraine either,” Saarikko summed up on Tuesday.

Before the meeting, there was no consensus among the member states on whether Hungary’s funding should be frozen as proposed based on the so-called conditionality mechanism. Some countries wanted the EU Commission to make a new assessment, because Hungary has said that it has made reforms that improve the rule of law even after the deadline expired.

The fear that Hungary could block Ukraine’s aid package at the meeting brought pressure, which later turned out to be realistic.

Getting Hungary’s so-called cohesion money depends on whether its weak rule of law jeopardizes the use of EU funds or not. Last week, the Commission was of the opinion that this is still the case.

If the council consisting of the ministers of the member countries takes the same view, Hungary will be left with about 7.5 billion euros of cohesion money hanging in the air. The Commission cannot grant funding based on the Council’s decision if reforms are not carried out.

Cohesion Fund is intended for countries whose gross national income per inhabitant is less than 90 percent of the EU average. In addition, Hungary’s so-called recovery money can also end up in the ice, which raises the stakes even more.

So far, there is no clarity on that, because the knot is being tried to be opened. Saarikko considered the summit organized next week, where the heads of state of the member states will gather, as one possibility. Another option is an extra meeting of finance ministers still in December.

Direct guarantees from other member countries for support to Ukraine could be one way to get the support to the finish line without Hungary.