EU Eyes Workaround as Hungary Blocks $106 Billion Ukraine Loan Ahead of April Vote

The European Union is weighing ways to bypass Hungary’s blockade of a proposed $106.1 billion loan for Ukraine.

But officials fear that ramping up pressure on Prime Minister Viktor Orbán during Hungary’s election campaign could backfire, according to Politico on February 25. 

Talks were due to continue on February 25 at a meeting of EU ambassadors, after the Council of the EU adopted two documents for the package on February 24, while Hungary blocked a third.

One EU official told Politico that Budapest was seeking to turn the dispute over the loan and its broader confrontation with Brussels into a political trap for Hungary’s opposition ahead of parliamentary elections on April 12. 

Diplomats cited by Politico described Hungary as “even more unpredictable than usual,” and said it remained unclear whether Orbán would revert to a compromise as the election approached.

EU officials told Politico the bloc could escalate by using Article 7 proceedings that can ultimately suspend a member state’s voting rights.

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They said the EU could also lean on steps such as withholding EU funds or launching infringement procedures, though they cautioned these options could take time and fuel Orbán’s campaign narrative.

Hungary has also threatened to block the loan unless Ukraine restores transit of Russian oil to Europe through the Druzhba pipeline

Earlier, it was reported that the European Commission president said the EU would secure the planned loan for Ukraine despite Hungary’s blockage, with the dispute tied to disrupted Druzhba oil flows.

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