EU cuts Hungary’s access to aid over rule of law violations

The European Commission has announced that Hungary forfeited its right to receive approximately 1 billion euros ($1.03 billion) in EU aid due to violations of the rule of law. 

The EU had previously pressured Hungary to amend its laws to address issues of corruption and conflicts of interest, Caliber.Az reports per foreign media.

Budapest was warned that it needed to implement reforms by the end of 2024 to avoid losing the funds. In 2022, the EU initiated "conditionality" proceedings against Hungary, aiming to block payments due to alleged violations of public procurement regulations, citing concerns over a lack of transparency and oversight. Hungary was found to have violated EU standards and core values, and was instructed to implement necessary reforms.

In response, Hungary agreed to undertake certain reforms, which led to the unfreezing of some funds, though 19 billion euros ($20 billion) remained blocked. According to the EU's conditionality regulation, if the suspension is not lifted, the first tranche of suspended funds, totaling €1 billion, will expire by the end of 2024. 

Hungarian Prime Minister Viktor Orbán has been in power in Hungary since 2010, and during his tenure, he has consolidated authority, while many of his allies have accumulated significant wealth.

In the first half of October 2008, the Hungarian authorities applied to the EU, the IMF and the World Bank for financial assistance because Hungary was experiencing serious market turbulences, difficulties in refinancing government and external debt.

In October 2008 it was agreed between the IMF, European Commission staff and the Hungarian authorities that Hungary would receive an overall amount of 20 billion euros in multilateral financial assistance.

By Naila Huseynova