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Secret EU plan ‘to sabotage Hungarian economy’ revealed as anger mounts at Orbán

 


Secret EU plan ‘to sabotage Hungarian economy’ revealed as anger mounts at Orbán

 

Brussels’ fury grows over Budapest’s ‘policy of blackmail’ in continuing to hold up £50bn support package

 

Lisa O'Carroll in Brussels

@lisaocarroll

Mon 29 Jan 2024 14.34 CET

https://www.theguardian.com/world/2024/jan/29/secret-eu-plan-to-sabotage-hungarian-economy-revealed-as-anger-mounts-at-orban

 

Officials in Brussels have reportedly drawn up a secret plan to sabotage Hungary’s economy if Viktor Orbán decides this week to again block a €50bn support package for Ukraine.

 

The plan, reported by the Financial Times, reflects the fury mounting across European capitals at what one diplomat called the “policy of blackmail” being pursued by the Hungarian prime minister, who leads the bloc’s most pro-Russia state.

 

The FT said the strategy involved targeting Hungary’s economy, weakening its currency and reducing investor confidence.

 

Orbán blocked the €50bn in Ukraine funds in December, forcing an emergency leaders meeting to be scheduled on Thursday to revisit the matter.

 

According to the FT, the document declares that “in the case of no agreement in the February 1 [summit], other heads of state and government would publicly declare that in the light of the unconstructive behaviour of the Hungarian PM they cannot imagine that [EU funds would be provided to Budapest].

 

Sources on Monday said EU capitals were still hopeful of a deal with Orbán and see the leak as a high-risk political move that could backfire. The Hungarian currency, the forint, depreciated by 0.7% on Monday, briefly down to a low against the euro last seen in October.

 

Hungary’s economy is heavily reliant on the single market, with nearly all its exports going across the border to neighbouring countries. According to European Commission data, intra-EU trade accounts for 78% of Hungary’s exports (Germany 28%, Romania, Slovakia, Austria and Italy all 5%), while 3% goes to the US and 3% to the UK.

 

The EU has already tried to use funds as a tool to force Hungary into line on policies and the application of the rule of law, a basic requirement of membership of the bloc; €20bn of funds are frozen over concerns about LGBTQ+ rights and other issues.

 

János Bóka, Hungary’s EU minister, told the FT that his country “does not give in to pressure” and there was no connection between Ukraine and general access to EU funds. “Hungary has and will continue to participate constructively in the negotiations,” he said.

 

On Monday he wrote on X: “The document, drafted by Brussels bureaucrats only confirms what the Hungarian government has been saying for a long time: access to EU funds is used for political blackmailing by Brussels.”

 

An EU source said: “The reality is Hungary has not really been flexible on this. The member state level of frustration is increasing. It is higher than in December.”

 

Another said Europe was “starting to look weak”, as Hungary repeatedly holds up or tries to block decisions.

 

It is understood the document is a background note written by the secretariat of the council under its own responsibility and may have been leaked to add pressure on Orbán before Thursday’s meeting.

 

On Friday it emerged that several member states were pushing for a triggering of article 7 of the treaty of the European Union to strip Hungary of voting rights if Orbán continues to block EU decisions.

 

Such is the concern about Budapest’s manoeuvres that the European Council president, Charles Michel, abandoned his plans to step down in July amid fears that Orbán could take the chair at summits until a new leader was found.

 

One diplomat warned that using article 7 was a last resort and should not be used despite the anger with Hungary.

 

Another said “something had to be done” especially given that Hungary was due to assume the rotating presidency of the bloc in July.

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