Budapest has blocked a new €500 million ($544 million) package of EU financial assistance to Kiev, urging Brussels to redirect its support elsewhere. The eighth tranche from the so-called European Peace Facility (EPF) – a €5.6 billion ($6.08 billion) off-budget fund used to finance and supply foreign militaries – was vetoed by Hungary on Monday.
Budapest told Reuters that it wanted the EPF to keep its original global scope, instead of being used exclusively to finance Kiev amid its ongoing conflict with Moscow.
“Hungary does not agree with the fact that the European Union, along with other existing tools, uses the EPF solely with regard to Ukraine, as this does not allow sufficient funds to be channeled to promote the EU’s interests in other areas,” a government spokesperson wrote in an email to the outlet, adding that the funds should be redirected to other regions, namely to the Balkans or North Africa.
“For the Hungarian government, it is crucial that these issues should be clarified, and that’s why it did not approve the disbursement of the next tranche from the EPF,” the spokesperson concluded.
The EPF was originally established in 2021, with a proclaimed goal of boosting the EU’s ability to maintain peace and strengthen regional and international security. The fund is used to reimburse the bloc’s own members, who send arms and equipment overseas, as well as to directly finance foreign militaries.
However, prior to the beginning of the conflict between Moscow and Kiev in February 2022, the fund was rarely used. A total of less than $125 million was allocated to supply non-lethal military equipment to several nations, including Ukraine. After the hostilities began, however, the EU funneled some €3.6 billion ($3.9 billion) under the EPF scheme to Ukraine in military support.
Budapest has found itself at odds with Brussels over the conflict, taking a neutral stance and refusing to supply Kiev with weaponry. Hungary has also prohibited weaponry shipments heading to Ukraine from going through its territory, as well as opposed the bloc’s anti-Russian sanctions.