Brussels After weeks of blockade by Viktor Orban, the EU is able to act again. The 27 EU ambassadors agreed on Tuesday night to approve aid to Ukraine amounting to 18 billion euros and to introduce a minimum tax of 15 percent on corporate profits across Europe.
The agreement was made possible because the Hungarian Prime Minister withdrew his veto. He had tried to blackmail his colleagues: he wanted the EU to release frozen funds for Hungary. This is 7.5 billion euros from the EU budget and 5.8 billion euros from the Corona recovery fund.
However, the EU ambassadors essentially reiterated the position of the EU Commission. The money should only flow when Orban implements effective measures against corruption in his country. As recommended by the Commission, the ambassadors approved Hungary’s Corona recovery plan. This was Orban’s main concern, otherwise the 5.8 billion euros would have expired at the end of the year. However, the money will not be paid out until Hungary has met 27 reform goals, such as creating an independent anti-corruption agency.
The ambassadors also insisted on freezing part of the EU budget for Hungary. This involves subsidies from the European Cohesion Fund, which are used to improve living conditions in structurally weak regions. However, the ambassadors made some concessions to Orban: Instead of the 7.5 billion euros recommended by the Commission, only 6.3 billion are to be withheld.
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Some member states wanted to recognize that Orban has recently shown himself willing to reform. However, the funds will only be released once the anti-corruption measures have been implemented.
Orban’s buckling shows his dependency
The decision is historic, because until now the governments had never applied the so-called rule of law mechanism. This provides that the EU can cut funding for a country in the event of violations of the rule of law.
The EU freezes billions in payments planned for Hungary.
(Photo: IMAGO/Christian Spicker)
Until recently, it was unclear whether the necessary qualified majority would be found in the Council of Member States. The Polish government in particular did not want to set a precedent. After all, she herself could one day find herself in a position where the EU wants to cut funds for Poland.
The fact that Orban finally gave in after weeks of blockade shows that he overdid it. The mood in the EU Council had recently become increasingly aggressive. In particular, the Hungarian veto against the Ukraine aid had outraged the partners. That is why Orban has apparently decided to be content with minimal concessions.
His buckling also shows how urgently he needs the money from Brussels. Given the grim economic situation in Hungary, he could not afford to forego the corona aid of 5.8 billion euros.
>> Read here: The corruption allegations undermine the legitimacy of the EU Parliament – to the delight of Viktor Orban
The nightly agreement was welcomed in the European Parliament. “Too little too late. But member states finally agree that Viktor Orban has gone too far,” tweeted Green MEP Daniel Freund, one of Orban’s harshest critics. “You can’t just threaten to veto everything and then get away with it.”
The FDP MP Moritz Körner said: “The cosiness with the enemies of the rule of law is over. The EU is no longer willing to finance Viktor Orban’s kleptocracy.” The significance of the decision extends far beyond Hungary: “Anyone who ignores the values of the EU must expect painful consequences.”
The provisional agreement reached by the ambassadors now has to be formally approved by the EU Council. This is to be done in writing so that the heads of government can deal with other issues at their summit on Thursday.
The unanimity of all 27 member states is required for the minimum tax and the Ukraine aid. The qualified majority of 15 EU states with at least 65 percent of the EU population is sufficient for freezing the funds to Hungary.
More: Frustration in Hungary – “The government attacks all companies that don’t have legs to run away”