The Hungarian government has embarked on another interesting game and Viktor Orbán is about to close a bitter deal in July. The timing is not accidental: although this issue is not on the agenda of today’s and tomorrow’s meeting of EU heads of state and government, all those involved are together for a frank dispute.

Viktor Orbán made a notable announcement before heading to the EU summit in Brussels. The Prime Minister told the MTI that if discussions prevented the Next Generation Fund from operating within the current framework, there was still the possibility for European states to establish this financial fund on an intergovernmental basis. therefore, outside the EU institutions, by intergovernmental agreement. It is about 750 billion euros, financed by the European Commission through a bond issue, that is, a long-term loan, of which 390 billion euros are in the form of grants and 360 billion euros in the form of a loan to help farms in danger from the corona virus. By “debates”, the Prime Minister means that most Member States want a close link between the use of budget money (even for the next generation) and compliance with the rule of law.

In this regard, however, it is important to know that if the EU does not obtain a loan, international financial markets will likely provide financing on much more unfavorable terms, also for Hungary. The EU is the best debtor in this situation, as it includes Hungarian government securities, but even Southern European ones, much lower than its first credit rating, which implies higher interest costs. In other words, Orban’s proposal would impose additional burdens on governments on the brink of bankruptcy.

It is also noteworthy that all the speeches made by the Hungarian government so far have been related to the need to comply with the agreement reached in July this year in all circumstances. However, Viktor Orbán would raise the most important point of this agreement. And it should be mentioned here that German circles have consistently denied in government circles that the Hungarian delegation announced during the negotiations that if they continue to adhere to the rule of law, the Hungarian Parliament will not authorize the Hungarian government to approve EU loans. That’s what Orban was talking about now.

And if Hungary is left out of the Next Generation program, it will lose the non-reimbursable support of some 6 billion euros, this was also confirmed by Gergely Gulyás in Government Info. And this loss of resources would occur when the government, since the outbreak of the epidemic, thinks the EU is not helping troubled Member States.

Of course, it was not only Orban who arrived with great impetus to the EU summit in Brussels from Thursday. Dutch Prime Minister Mark Rutte, whom he only refers to as a “Dutch guy,” said he would block the financial package (including the budget and recovery fund) if Dutch demands to link payments and the status of law. Rutte hopes that the European Parliament will also be very tough on this issue. He indicated that he was not satisfied with the current German proposal, which would in fact limit the scope to financial abuse, meaning that sanctions would only be imposed if the financial interests of the EU were at stake. Rutte put it this way about a possible veto

In theory, anything can happen, but nobody wants that.



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