Hungary under pressing threat of freezing European funds

Member States have until December 19 to vote with a qualified majority.

LThe reforms launched by Viktor Orbán may not be enough: The European Commission on Wednesday recommended freezing more than 7.5 billion euros in European funds for Hungary in response to the corruption problems identified in the country.

The European executive has finally chosen to stand firm against the nationalist leader – despite alleged “blackmail” against the latter, with Budapest blocking an 18 billion euro public aid package for Ukraine and a minimum tax on the profits of multinational corporations.

Hungary – which denies any connection between these sanctions and the question of European funds – also opposes new sanctions against Russia, maintains relations with it, and is the only NATO country with Turkey that does not approve this alliance with Sweden. and Finland.

Under pressure from the European Parliament, the European Commission has proposed to member states to decide by December 19, to suspend the 7.5 billion cohesion funds owed to Hungary as part of the 2021 budget.-2027 EU.

The so-called “conditionality” procedure aimed at protecting the European budget from attacks on the law was launched against this country in April, a first for the EU, especially due to “systemic irregularities in the awarding of public procurement”, legal actions and “failures” in terms of the fight against corruption.

The prospect of losing the funds has prompted Hungary to take 17 measures to address Brussels’ concerns, including establishing an “independent authority” to better control the use of EU funds suspected to enrich Viktor Orbán’s relatives.

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But the commission felt that the reforms were not satisfactorily carried out by the November 19 deadline. The European executive set the September deadline to give Hungary a chance to escape the freeze of 7.5 billion euros (about 20% of EU funds due in 2021-2027).

Ball in the court of member states

The European executive has decided to check Hungary’s post-Covid recovery plan (€5.8 billion), but by attaching 27 conditions, including 17 anti-corruption measures and reforms to improve the independence of the judiciary.

“Funding will not be provided until these essential conditions are properly met,” Valdis Dombrovskis, the commission’s executive vice president, told a news conference. The EU executive, who until recently favored a compromise approach by emphasizing Hungary’s progress, has finally hardened his stance.

According to several European sources, the influence of the MEPs, who met in plenary session last week and heavily support the anti-Orban toughness, was decisive. The possibility of an audit movement of the Commission in the absence of a financial freeze has even been mentioned, especially by the Renewing Europe group (centrists). Hungarian negotiator Tibor Navracsics on Tuesday condemned this “enormous political pressure” from the European Parliament.

A year and a half before the European elections, many MEPs are keen to campaign to defend the rule of law in the face of anti-democratic excesses in the EU.

It remains to be seen whether member states will follow this hard line, as they must take their decision by a qualified majority (15 out of 27 countries, representing at least 65% of the total EU population).

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A meeting of the Ministers of Economy and Finance will be held on December 6. While Scandinavian countries and the Benelux have traditionally been sensitive to the rule of law and the fight against corruption, many countries in Eastern and Southern Europe may be more reluctant to freeze funds.

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