Stark new EU documents reveal immediate plans drawn up by a European Council official to engineer a financial crisis in Hungary, specifically targeting the country’s currency and debt servicing in a ploy to punish and destabilise the ruling Fidesz government over its position on Ukraine.
The revelations come ahead of a special EU Council meeting Thursday to discuss EU funding for Ukraine. Hungary has come under fire from Eurocrats for blocking EU attempts at sending another €50 billion in financial support to Ukraine, a decision that requires the approval of all member states. PM Viktor Orbán has said EU funding to Ukraine must not come out of the EU’s budget, and that Hungary does not want to engage in collective borrowing and go into debt along with other countries.
The explicit document seen by the Financial Times outlines EU plans to permanently cancel all EU funding going to Hungary. This, the document says, would lead to a situation where “financial markets and European and international companies might be less interested to invest in Hungary.” Withdrawing EU funding could also “quickly trigger a further increase of the cost of funding of the public deficit and a drop in the currency,” the report says.
The plans were defended off the record by various EU officials who declared that Brussels was only retaliating to alleged ‘blackmail’—that is, using the right to disagree given to every member country—from Orbán. The European Parliament has also set in motion plans this month that could strip Hungary of its voting rights at the European Council.
Bóka János, Hungarian Minister for Europe, publicly lambasted the attempt to strongarm Hungary into changing its Ukraine policy Monday morning saying that EU elites were increasingly weaponising access to funding to shift national policy and adding that Budapest would participate constructively in the negotiations, but will not give in to “blackmail” on Ukraine.
While the EU has previously used finance to bring wayward member states into line—as with Greece during the euro zone crisis—many feel the showdown between Brussels and the Orbán government to be accelerating, with Eurocrats continuing to fret ahead of Hungary’s Presidency of the European Council later this year.
The European Commission did not respond to queries raised by The European Conservative at the time of publication about whether the leaked report would constitute financial blackmail of a sovereign member state government.
Whether or not the plans would have the desired effect, they point to the growing hostility of EU leaders towards sovereigntist governments that defend their own national interests.
There are growing diplomatic signs that the EU may use an expected dispute between it and Hungarian officials to trigger Article 7 proceedings and strip Budapest of voting rights on matters such as foreign policy.