The European Union has prepared a €20 billion back-up plan (or $32.3 billion) in order to bypass objections of Hungary’s Viktor Orban over keeping up funding for war-ravaged Ukraine.
The debt-funded scheme is similar to the €100 billion Covid-19 pandemic fund for EU countries in 2020, but doesn't require guarantees from all member states, only those with the highest credit ratings who will make up the main participants.
In mid-December, Hungary finally allowed the bloc to move forward on EU membership talks for Ukraine by abstaining from the vote instead of a "no" - but still blocked a 50 billion euro package of financial aid for Kiev.
Just before Christmas, Orban reiterated in a speech, "I am convinced that to give Ukraine 50 billion euros ($54.70 billion) from the EU budget for five years... That's a bad decision."
He then explained his position further, saying, "They want to give the money to Ukraine from inside the EU budget, Hungary wants to give it outside the EU budget. They have the possibility - if we don't agree on this - to resolve this outside the budget but don't have the option of resolving this from the EU budget without Hungarian approval."
This newly proposed plan for raising €20-plus billion could prove a lengthy process, however, as it's not expected to result in funds for Ukraine until at least March:
This option does not require guarantees from all 27 EU member states, allowing the inclusion of countries with the highest credit ratings as principal participants.
As unanimous support is not required, the approach would allow the EU to bypass Hungary’s veto. Some countries, including Germany and the Netherlands, may require parliamentary approval to provide national guarantees.
On Wednesday, Kremlin spokesman Dmitry Peskov reacted to the reports by saying that common European taxpayers are starting to realize the degree to which their money is being mishandled by Ukraine.
"Both Europeans and Americans are already well aware of the level of corruption (in Ukraine) and they understand that a fair portion of this money is stolen," Peskov told a press briefing.
Hawks are seeing "hope" in this EU move...
Doesn’t exactly scream war fatigue, does it? “The EU is preparing a back-up plan worth up to €20bn for Ukraine, using a debt structure that sidesteps the objections of Hungary’s Viktor Orbán…” https://t.co/00JHZuIz7v
— Shashank Joshi (@shashj) December 26, 2023
"This money will not be able to change the course of events (in the Ukraine conflict)... This money is allocated to the detriment of EU economies which are already going through difficult times..," he said, at a moment it's being widely recognized that Russia is winning the war amid a severe Ukrainian manpower and ammo shortage.
