Poland has reacted with frustration after Hungary blocked a payment of around €2 billion in European Union funds intended to compensate Warsaw for its military aid to Ukraine over the war with Russia.
Hungarian Prime Minister Viktor Orbán’s government is blocking the payment from the European Peace Facility, an off-budget EU instrument designed to reimburse governments that send military aid to Kyiv.
The Hungarians have consistently opposed military aid to Kyiv and Orbán has maintained high-level relations with Russian President Vladimir Putin following Moscow’s invasion of Ukraine in 2022.
Orbán has recently visited both the Russian capital and Kyiv in an effort to facilitate negotiations to end the war. That was criticised by other EU leaders who argued that the Hungarian government was effectively giving succour to the Russians. The Hungarians countered that channels must remain open to both nations if a peace agreement is to be reached.
On July 10, at a NATO summit in Washington, Polish foreign minister Radosław Sikorski told reporters that “Hungary is abusing our trust” and called the Hungarian stance “unfriendly and hostile”. He confirmed that the money blocked by the country was intended to fund the modernisation of Poland’s armed forces.
An unnamed Polish Government official told portal Onet.pl: “If the Hungarians hadn’t blocked payments, we would have already got a lot of money back. In total, we have invested about €4.5 billion in helping Ukraine. We could get about half of it back.” The official claimed Hungary was devising “new excuses” to delay the transfer of the funds, adding that the latest reason Budapest gave involved alleged mistreatment of the Hungarian minority in Ukraine.
Separately, Hungary and the European Commission are at odds over frozen Covid “recovery” funds amounting to billions of euros due to Kyiv.
Polish President Andrzej Duda has been critical of Hungary over its stance on the war. Interviewed by Polish commercial television channel TVN24 Duda said: “In matters of foreign policy, especially when it comes to Ukraine, Poland and Hungary, led by Viktor Orbán, today have two completely polar [opposite] approaches.”
Poland is not the only country affected by the blockage of the funds. The arrears to be paid out by the EU to all countries supporting Ukraine amount to about €9 billion.
In June, the foreign ministers of 26 EU countries decided to by-pass Hungary’s veto on proposed aid to Ukraine, enabling them to grant Kyiv up to €1.4 billion for ammunition and air defences. Still, that only involves frozen Russian financial assets and does not resolve the problem of the Hungarian blockage of other EU funds.
Pressure is likely to be brought to bear on Budapest with a Polish official confirming to Onet.pl that “sharp words will be had” and Hungary was likely to want to extract concessions from the EU on the release of the EU funds.
