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Hungary, Poland veto EU recovery fund over rule-of-law issue

BRUSSELS, BELGIUM – Hungary and Poland have followed through on their threat to veto the EU’s historic €1.8tn budget, which includes €750bn for a COVID recovery fund, over a clause that ties funding with adherence to the rule-of-law in the bloc.

Needing a unanimous vote from all 27 members in order to pass the bloc’s seven-year budget and recovery package, ambassadors meeting in Brussels were thus unable to endorse the massive financial plan aimed at rebuilding Europe’s shattered economy.

The veto is likely to delay the delivery of the much-needed rescue package.

“Hungary has vetoed the budget,” stated the Hungarian government’s notoriously outspoken spokesman for international affairs Zoltán Kovács. “We cannot support the plan in its present form to tie rule-of-law criteria to budget decisions.”

Hungarian Prime Minister Viktor Orbán, whose government has been accused of becoming increasingly authoritarian in style and substance, had sent a note ahead of the meeting to German Chancellor Angela Merkel and French President Emmanuel Macron claiming that the rule-of-law clause “jeopardises trust” between member states.

“The question is whether Poland will be subject to political and institutionalized enslavement,” Poland’s justice minister Zbigniew Ziobro also said. “Because this is not rule-of-law, which is just a pretext, it is really an institutional, political enslavement, a radical limitation of sovereignty.”

Donald Tusk, head of the European People’s Party (EPP) and former Polish prime minister who famously called the current populist government “contemporary Bolsheviks”, denounced the move.

“Whoever is against the principle of the rule of law is against Europe. I expect a clear position on this from all the EPP parties. The opponents of our fundamental values should no longer be protected by anyone,” he tweeted.

German ambassador Michael Clauss, who chaired the meeting, warned that the EU would face “a serious crisis” if the financial package was not quickly adopted and delivered.

“We have already lost a lot of time in view of the second pandemic wave and the severe economic damage,” he added.

Hungary and Poland, who have long been at odds with the EU over the issue of declining democratic norms, are stauchly opposed to the clause that could see them lose billions in EU subsidies should they continue with policies seen as eroding democracy.

The two countries are currently under investigation for undermining the independence of courts, media and non-governmental organisations.

Last month, U.S. President-elect Joe Biden had irritated Polish and Hungarian authorities after comparing their respective governments to “totalitarian regimes” after commentators pointed out that a Biden win in November 2020 could spell trouble for Hungary and Poland, and pave the way for a refocusing of U.S. foreign policy on rule-of-law and democratic values.