FT: The EU threatens to undermine Hungaryʼs economy if it blocks the aid package to Ukraine

The European Union will undermine Hungaryʼs economy if Budapest blocks new aid to Ukraine at a summit this week.

The Financial Times writes about this with reference to the EU plan, which the publication has seen.

If Hungary refuses to lift the veto on aid to Ukraine, other EU countries will publicly declare that they will not provide aid to Budapest. This may cause the Hungarian forint to fall and undermine the confidence of investors, who will be less interested in investing in Hungary. The consequence of this may be economic problems — because the economy of Hungary depends to a large extent on foreign funding, in particular on funding from the European Union.

The publication notes that under pressure from other countries, Hungary will agree to a compromise regarding aid to Ukraine. Hungarian EU Affairs Minister János Boca said the country would accept "compromises" as long as they did not affect Hungaryʼs "vital interests" and if the country retained its annual veto. The Financial Times notes that other EU countries have rejected the proposal because they fear that Hungarian Prime Minister Viktor Orbán will try to block aid to Ukraine and seek further concessions every year.

At the same time, Janos added that if a compromise is not reached, Budapest will prefer Hungaryʼs initial proposal for a separate fund for Ukraine outside the EU budget.

Brussels has used financial leverage on EU member states before, for example in the case of Poland and Hungary due to problems with the rule of law, or in the case of Greece during the eurozone crisis. But the strategy aimed at undermining the economy of the EU member state will be a new important step for the bloc.

Three EU diplomats told the publication that many countries supported this plan — the mood in the European Union allegedly became "harder."

• Earlier, Bloomberg wrote that the EU countries are ready to take tough measures against Hungary in case of disapproval of aid to Ukraine. According to the publication, punitive measures may be introduced against Hungary — up to depriving Budapest of the right to vote as an EU member state.