EU heads of state and government on Friday confirmed their continued support for Ukraine, despite dissent from Hungary and Slovakia, on the second day of their autumn summit in Brussels.
Ukrainian President Volodymyr Zelensky’s video-conference appearance on Thursday, now a ritual at each summit, and the leaders’ broad support for the creation of a facility that would provide Ukraine with €50 billion over four years in grants and loans, set the tone during an evening debate on the mid-term review of the EU budget framework.
Council President Charles Michel stressed that EU support for Ukraine was unwavering and would last as long as necessary.
Concern over dissenters Hungary and Slovakia
To help Ukraine as winter approaches, in addition to the missiles and shells already promised, the EU-27 have pledged to step up their supply of humanitarian aid, including electricity generators, transformers, mobile heating systems and lighting equipment.
Some feared that the situation in the Middle East would overshadow support for Ukraine, especially as two member states had sent out dissonant signals.
Asked about Hungarian leader Viktor Orban, who last week shook hands with Russian President Vladimir Putin in China, and Slovak leader Robert Fico, who announced a halt to his country’s arms deliveries to Ukraine, limiting support to “humanitarian and civilian aid,” the Council president reiterated the need for EU unity.
A summit “is always an exercise in collective intelligence to be united at the end,” he said.
Hungary blocks peace funds
On Thursday, Orban took advantage of the cameras to proclaim his pride in “keeping open” communication with Moscow, claiming a “strategy” in favour of peace. But few leaders reacted, clearly anxious not to give the populist any more fuel.
“I’m not a fan at all. Besides, no one around the table said we shouldn’t help Ukraine,” Belgian Prime Minister Alexander De Croo remarked.
“We can convince these two to support Ukraine” with the €50-billion facility, Estonian Prime Minister Kaja Kallas said.
French President Emmanuel Macron stressed that he had no intention of “judging” the meeting, but that it should not “weaken” the European Union in its support for Ukraine.
Commission President Ursula von der Leyen said that while leaders are "sovereign" and "free to choose" their discussion partners, close coordination and transparency were needed whenever the content of discussions affected the EU and its unity.
Hungary is blocking the release of a further €500 million from the European Peace Facility (EPF), which finances the delivery of arms to Ukraine by EU member states.
New prospects for Poland
Budapest is demanding the removal of the Hungarian bank OTP from the blacklist of Russian war sponsors, as its provisional withdrawal is not sufficient in its eyes. “We are waiting for the Ukrainian delegation to come to Budapest to negotiate, and we are ready for an agreement,” said the Hungarian leader.
The EPF should also be increased by €20 billion for military support to Ukraine, an issue which, although not formally linked to the multi-annual budget, could land with the latter in a major negotiation at the EU's December summit. Orban will undoubtedly return to this issue with his demand for the release of tens of billions of euros from the recovery and resilience facility (RFF) to which his country would be entitled if his government did not undermine democratic values and the rule of law.
Poland is also in this situation, but the prospect of a return to power of the pro-European Donald Tusk, well placed after the mid-October elections, opens up new prospects for Warsaw, further isolating Hungary.
As for the plan to use frozen Russian assets in private financial institutions for the reconstruction of Ukraine, it is not yet ready, after warnings about legal security from the European Central Bank. According to the summit conclusions, EU leaders will ask the EU’s High Representative for Foreign Affairs, Josep Borrell, and the Commission to speed up the presentation of proposals.
Using frozen Russian assets to help Ukraine
Belgium is particularly concerned, as many of the frozen Russian financial assets are held by international financial institutions based in Brussels. The Belgian government has already decided to allocate €1.7 billion in corporate tax revenue from these frozen assets to support Ukraine.
“There are windfall profits being made by a small number of financial institutions in the EU. We are going to propose a way of using the proceeds of these assets. The idea is to bring them together and channel them through the EU budget, en bloc, for the reconstruction of Ukraine," confirmed Commission president von der Leyen.
To further weaken Russia’s capacity for aggression, the leaders are calling for a strengthening of European sanctions, focusing on their effective implementation and on preventing their circumvention. But the twelfth sanctions package has been under discussion for months. In this regard, President Zelensky has called for the Russian oil price cap to be lowered, as “it is clear that it is not working as effectively as was intended” when it was introduced.
This package of sanctions is linked in particular to progress on the ban on Russian diamonds in the EU, the Commission president said.
