Belgium, (Brussels Morning Newspaper) The European Commission proposed to take on more joint debt to support Ukraine, to which Hungary objected.
The Commission wants to borrow up to 18 billion euro next year to send to Ukraine in the form of concessional loans, according to Reuters reporting on Wednesday.
Ukrainian President Volodymyr Zelenskyy commented on the EC’s proposal, stressing that the move shows solidarity and adding “together we resist Russia’s aggression, together we’ll rebuild Ukraine, together we’ll be in the EU.”
Hungarian Finance Minister Mihály Varga pointed out in a statement on Tuesday “I have made it clear that Hungary is ready to support Ukraine, but we do not wish to contribute to any new loan to be taken up by the EU.”
The EC stressed that proposed support averages 1.5 billion euro per month, which would help Ukraine to cover most of its short-term funding needs next year. According to Ukraine and International Monetary Fund’s estimates, the country will need between 3 and 4 billion euro per month.
The Commission pointed out that the money would help Ukraine to maintain macro-financial stability, rebuild infrastructure and finance key public services. According to the proposal, the EC would borrow the money on the market.
Plan needs EU Council approval
The EU Parliament and the EU Council still need to approve the proposal before the Commission can implement the plan.
Gergely Gulyás, head of Prime Minister Viktor Orbán’s office, reiterated that Hungary is willing to do its part to help Ukraine. He stressed that Budapest prefers a bilateral arrangement to more joint borrowing, reminding that the EU borrowed a lot to support bloc members in the coronavirus crisis.
“Now they ask us again to approve something that we had never agreed with in principle,” Gulyás pointed out and added “there is joint decision making, so if we don’t agree to this, this decision cannot be made.”
Valdis Dombrovskis, European Commissioner for Trade, commented on Hungary’s objection to the Commission’s plan at a press conference.
“We will be discussing… what concerns Hungary has in relation to this proposal and I hope we will come up with a solution,” he concluded.
