The European Union is considering withholding further funding owed to Hungary to cause a run on its currency and deter foreign investment into the country should Prime Minister Viktor Orbán continue to oppose Brussels’ plans to hand €50 billion in aid to Ukraine from the EU budget.
A confidential document leaked to the Financial Times newspaper revealed Brussels’ intention to turn the screw on Orbán, the bloc’s most prominent dissenter who has consistently argued that any future financial aid to Ukraine should be found without the EU executive demanding increased budget contributions from member states.
According to the U.K. broadsheet, the document, which was produced by an official working within the EU Council, states that should Hungary not comply with the European majority to sanction funding for Kyiv through the EU budget, national leaders will call for all EU funding to Budapest to be suspended due to Orbán’s “unconstructive behavior.”
As a result, “financial markets and European and international companies might be less interested in investing in Hungary,” it adds, acknowledging that such a move “could quickly trigger a further increase in the cost of funding the public deficit and a drop in the currency.”
The European Union has historically resorted to controversial measures to ensure member states toe the line — as seen previously with withheld funds to Hungary and Poland, and the demand by Brussels for Greece to implement crippling austerity measures during the eurozone crisis. However, while formal conditionality has been placed on receipt of EU funds previously, a deliberate attempt to trigger an economic meltdown in a member state refusing to comply with an isolated policy proposal is unprecedented.
The document even highlights what EU officials believe to be frailties within the Hungarian economy to be exploited to bend Budapest to its will, noting its “very high public deficit,” weak currency, and “very high inflation.”
Responding to the news, Hungary’s Minister for European Union Affairs János Bóka insisted his country would not succumb to blackmail.
“This only confirms what the Hungarian government has been saying for a long time: access to EU funds is used for political blackmailing by Brussels,” Bóka wrote on X.
“Hungary does not link the support for Ukraine and access to EU funds and rejects other actors doing so.
“Hungary has been and will continue to participate constructively in the negotiations, but will not give in to blackmail,” he added.
Koskovics Zoltán, a geopolitical analyst at the Budapest-based Center for Fundamental Rights, said the plan was proof that “truly insane maniacs rule in Brussels.”
“The elections cannot come soon enough,” he added.
