EU breaks silence on Hungary’s EUR 16 billion defence loan as approval remains pending

Hungary was the only member state left out of the latest round of EU defence approvals, with its proposal not even mentioned in the official statement. Now, however, the European Commission has finally responded to questions surrounding the fate of the EUR 16.2 billion (around HUF 6,300 billion) loan.

Hungary left without approval in latest round

Under the European Union’s SAFE (Security Action for Europe) programme, €150 billion is available to support defence developments across member states. In recent weeks, several countries – including the Czech Republic and France – received approval for their national plans.

Hungary, however, did not receive approval in this round and was also absent from the official communication released by the Commission.

After weeks of silence, Commission spokesperson Thomas Regnier responded to an inquiry by Economx, stating that Hungary’s plan will be approved once the ongoing evaluation process is completed.

This means the proposal has not been formally rejected. At the same time, no explanation has been provided for the delay, nor any indication of when a final decision may be expected.

“The Commission will approve the Hungarian plan once the ongoing assessment is completed,” said Regnier.

Why is the SAFE loan delayed?

For now, only analytical interpretations are available regarding the delay. Speaking to Economx, Szabolcs Pásztor, research director at the Oeconomus Economic Research Foundation, suggested that the hold-up is unlikely to be due to economic or technical reasons.

According to the analyst, the Commission may be deliberately delaying its decision. On the one hand, it avoids issuing a formal rejection; on the other, it may also be reluctant to make a financially favourable decision for the current Hungarian government close to an election period.

Another factor may be that 15 out of the 19 national plans submitted to the Commission include joint projects with Ukraine. In this context, Hungary’s more critical stance towards Ukraine and its relationship with Russia is viewed critically by several EU actors, which may also be contributing to the delay.

We have previously reported on the recent diplomatic tensions surrounding these ties.

No final decision yet on Hungary’s defence loan

Based on the Commission’s response, Hungary has not been excluded from the programme, and access to the loan remains possible. The key question is timing: no deadline has been given, and it is unclear when the evaluation will be concluded.

Meanwhile, the European Commission has already approved a EUR 1.5 billion work programme under the European Defence Industry Programme, aimed at strengthening both the European and Ukrainian defence industries.

More than EUR 260 million from this package will support the development of Ukraine’s defence industrial base, alongside additional funding for joint EU–Ukraine projects and innovation.

Against this backdrop, it is notable that while several member states and Ukraine are already receiving funding, no decision has yet been made on Hungary’s defence loan.

It also remains unclear what impact the delay may have on Hungary’s defence developments and public finances. The Ministry for National Economy has not yet responded to inquiries on the matter.

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