Ukraine aid in limbo: Why Hungary’s veto could derail European peace efforts!

The Hungarian government persists in obstructing payments from the European Peace Facility. Initially, the government cited Ukraine’s inclusion of OTP on its list of international sponsors of the conflict as justification for the veto. What’s the fate of the Ukraine aid then? 

According to Telex, despite the subsequent disappearance of the list, the government remains steadfast in its stance regarding the Ukraine aid. Foreign Minister Szijjártó now asserts that Ukraine aims to revoke approval for 14 medicines manufactured by Richter, further entrenching their position.

The European Peace Facility operates independently of the EU budget, funded by contributions from Member States. Those who have supplied Ukraine with part of their stocks can receive a 60 per cent reimbursement from this fund.

With each Member state increasing their contributions by EUR 500 Million, the total now stands at EUR 6 billion. However, disbursing payments requires unanimous agreement from their member states, and Hungary’s government has consistently blocked the release of the eighth installment.

This obstruction has persisted, resulting in Hungary’s cumulative blockage of EUR 2 billion. Notable, even if other Member States proposed additional installments, Hungary’s veto o power would extend to those as well.

The rationale for the Ukraine aid veto

Hungary’s initial rationale for the veto centred on Ukraine’s inclusion of OTP on its roster of international war sponsors. With operations in Russia and Ukraine, the bank contested this justification as unjust. Foreign Minister Péter Szijjártó conditioned the lifting of the veto on OTP’s removal from the list.

Upon its removal, he insisted on a face-to-face meeting in Budapest with the compiling prosecutor’s office for assurances that the bank would not be reinstated. However, the relevance of these demands became obsolete when the list itself mysteriously vanished a few days ago.

At the foreign minister’s meeting in Luxembourg, Péter Szijjártó persisted in characterizing the situation as a witch-hunt targeting Hungarian companies. The Foreign Minister stated that:

Until we receive assurances from the Ukrainian side to cease and desist this witch-hunt against Hungarian companies operating in Ukraine, we cannot endorse such measures.

Hungary maintains its stance regarding the Ukraine aid, demanding assurances that Ukraine will refrain from similar actions in the future. Szijjártó has introduced another rationale since then concerning the Ukraine aid.

Szijjártó contends that Ukrainians aim to revoke marketing authorizations for 14 medicines distributed by Richter, emphasizing the lack of justification for such actions. He asserts that Richter has not contravened Ukrainian regulations nor violated any sanctions. Additionally, Szijjártó highlighted that Richter’s operations in Russia comply with all relevant legislation.

According to HVG, theoretically, funds exist to offset expenses borne by Member States but the reality paints a different picture of a shortfall. Péter Szijjártó attempted to assuage concerns by suggesting that individuals could still procure as many weapons as needed for Ukraine, potentially easing tensions. Up to this day, this is all we know regarding the Ukraine aid debate.

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