Ukraine Celebrates EU Approval Of $54BN Aid Package After Hungary's Orban Caved

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by Tyler Durden
Thursday, Feb 01, 2024 - 11:40 PM

"We have a deal," European Council President Charles Michel announced on X Thursday, declaring that all 27 European Union countries have finally agreed to the additional 50-billion-euro ($54bn) aid package for Ukraine, which was under threat of Hungarian veto.

The unanimous approval "locks in steadfast, long-term, predictable funding for Ukraine" and further demonstrates the "EU is taking leadership and responsibility in support for Ukraine; we know what is at stake," Michel said.

Ukrainian President Zelensky too hailed the 'victory' - stressing that "It is very important that the decision was made by all 27 leaders, which once again proves strong EU unity."

Via Reuters

Zelensky added, "Continued EU financial support for Ukraine will strengthen long-term economic and financial stability, which is no less important than military assistance and sanctions pressure on Russia."

The approval for the funding was reportedly achieved merely within an hour into the special summit of EU leaders which gathered in Brussels on Thursday.

Estonia's leader Prime Minister Kaja Kallas also hailed the "important signal to Ukraine that the EU stands behind you long-term, until victory."

There's also been a lot of backslapping and self-congratulations in Brussels over EU diplomats getting lone holdout Viktor Orban to fold

The European leaders managed to win over Orbán with three additions, diplomats said. There will be an annual report by the European Commission on the implementation of the aid package, there will be a debate at leaders' level on the implementation of the package and, if it is needed, in two years the European Council will ask the Commission propose a review of the new budget, according to the latest version of the draft European Council conclusions.

EU leaders added a line referring to earlier conclusions from December 2020 to guarantee that the way the rule of law in Hungary is evaluated by the European Commission is done in a fair and objective manner.

This is music to Orbán’s ears, as the 2020 text has implications for the €6.3 billion of EU cohesion funds that were frozen for Hungary over rule-of-law shortcomings.

Ron Paul Institute director Daniel McAdams, who worked as a journalist in Budapest throughout the 1990s said that the Orban government "caved" plane and simple...

But McAdams clarified that "I still have great admiration for Orban but this should have been handled differently. I know the exact kinds of internal discussions on this. But you can't be both a bold maverick and a 'team player.' That scumbag Tusk likely tipped the balance."

He added: "Hungary has no real allies in the EU at present, save for perhaps Fico. But even that for historic reasons is not the smoothest of sailing, particularly when suddenly karpatalja is being whispered about. So Orban probably figured this is not the time to go for broke."

And a Rabobank note pointed out the following broader ironies

In Europe, we have disinflation; and deindustrialisation; and Macron, Scholz, and Rutte saying Europe must rearm to help Ukraine beat Russia’s war economy – this from a Chancellor who didn’t arm Ukrainians, and a PM who didn’t arm the Dutch.

At the start of the week, amid Hungary's perceived intransigeance on the Ukraine funding issued, some EU diplomats have begun to complain Europe is "starting to look weak". But Orban beginning on Tuesday began giving off signals that he was ready to soften his stance.