Hungary loses EU funding due to rule-of-law quarrel
(MENAFN) As of January 1, 2025, Hungary has been permanently denied access to over €1 billion ($1.04 billion) in European Union funding due to ongoing concerns over rule-of-law violations, according to a European Commission spokesperson. This marks the first time an EU member state has lost funding permanently under the EU’s "conditionality" mechanism, which was introduced in 2020. The mechanism allows Brussels to suspend funds to countries deemed to be in violation of EU principles on the rule of law.
Hungary has been under pressure from the EU to reform its laws to address issues such as conflicts of interest and corruption. The EU began the "conditionality" proceedings against Hungary in 2022 and blocked funds, citing violations of public procurement rules and lack of transparency. While Hungary has implemented some reforms, about €19 billion in funds remain frozen. The EU's 2024 Rule of Law report highlighted ongoing issues with corruption, media independence, political financing, and conflicts of interest in Hungary, which have not yet been fully addressed.
Hungarian Prime Minister Viktor Orban contends that his government has met all EU demands and vowed to protect the country’s access to the funds. In December, Orban threatened to veto the EU's upcoming seven-year budget if Hungary does not regain access to the blocked money. Meanwhile, Hungary has turned to alternative funding sources, including loans from China, to finance various projects amid the dispute.
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