The European Commission has stripped 1.04 billion Euro in aid from Hungary in the latest phase of an ongoing political struggle with its errant member state.

The amount of money lost is a blow for Hungary, but the decision also has wider economic and geopolitical implications. Hungarian prime minister Viktor Orbán has consistently flouted EU standards and democratic principles. The question now is whether he has run out of options.

The European Union mobilises and redistributes a vast amount of collective funding to its poorer countries and regions. Since the 1970s, a complex set of funding instruments has emerged under the banner of “cohesion policy”.

For the 2021-27 budgetary period, the EU has allocated 392 billion Euro for cohesion policy, supplemented by 750 billion Euro in grants and cheap loans from the Next Generation EU programme. These funds can be used for the development of infrastructure, environmental protection and support for the private sector (in particular for the green economy).

No other regional institution does anything like this. For poorer countries, these funds can amount to a significant proportion of GDP, and distributing such a large pot of money gives latent power to the European Commission.

The EU is also noteworthy as an institution in that it makes support for democratic values and the rule of law a prerequisite for membership to its club. It considers itself a bulwark of liberal values and constitutionalism: there is not supposed to be any room at the table for authoritarians.

However, the EU was slack in enforcing this rule with Orbán. After he came to power in 2010, the Hungarian prime minister began to institute various repressive and cronyist measures that boosted his personal power and that of his governing party (Fidesz).

Orbán was even accused of directly using EU funds for these purposes. He was protected for some time by membership of the powerful European People’s Party (EPP) in the European parliament and developed his own form of populist Euroscepticism, while raking in money from Brussels.

Eventually, he went too far and alienated his erstwhile allies (leaving the EPP group in 2021), as the commission began to take measures against him.

In 2020, the European Commission introduced the rule of law conditionality mechanism, which made it much easier to suspend or withdraw funds from member states if there are concerns about their commitments to democracy. This was used against Poland and Hungary in 2022. Just to give an idea of the stakes, the former had a total of 136 billion Euro unblocked when its new government agreed to Brussels’ terms.

Hungary also had over 30 billion Euro frozen over the same period. A game of cat and mouse continued, with Orbán threatening and occasionally using his national veto to frustrate European Union action in support of Ukraine. In December 2023, 10.2 billion Euro of cohesion funds were unfrozen, in a rather tortuously worded decision, just before a crucial vote on Ukraine aid and accession. Another 20 billion Euro plus was still withheld, however.

A commission report on the rule of law in Hungary in July 2024 noted that Orbán’s government had made some reforms (under pressure) but still noted systemic problems around issues such as judicial and media independence.

At that time, Hungary also held the EU presidency (which rotates every six months). Orbán was using this position to promote himself on the world stage, visiting Moscow and Beijing to sell a different “European” view and further annoying the EU leadership.

NEXT MOVES

It should be noted that the decision to strip Hungary of its 1.04 billion Euro is in some sense a technical issue. Funds are automatically withdrawn two years after the suspension starts. But it is nevertheless highly significant as it implies that the status quo will not continue. Without change, Hungary could lose the rest of the funds permanently.

The implications of this are manifold. The EU had been accused of tolerating authoritarians in its midst, but this is clearly changing. However, it is changing at a time when more and more nativist populists are coming to power in the EU.

Can the commission maintain its rigorous approach or will pressure from governments soften it up? Donald Trump is a warm ally of Orbán, but it’s not certain that he would be willing or able to help Hungary in this form of dispute. If he does try, that would be a sign that there is some substance to the idea of a global nativist populist alliance.

Orbán himself has reacted angrily to this loss of funds and has threatened to use his national veto more aggressively – which he has threatened to do in the past. Hungary is in an economically fragile position so it is not clear how much of a confrontation he can afford.

Meanwhile, opposition to Orbán is growing within Hungary and the rising opposition leader, Peter Magyar, has declared that he can “unlock” the billions of EU funds still due. This could be a potent election slogan (the next ones are due in 2026). It would also amount to the EU entering Hungary’s domestic political sphere in a very tangible way.

(Author: Patrick Holden, Leader of the Online Masters in International Relations : Security and Development, University of Plymouth)

(Disclosure Statement: Patrick Holden does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment)

This article is republished from The Conversation under a Creative Commons license. Read the original article.
 

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Tbilisi, Georgia:

Georgia’s president, locked in a standoff with her own government, appealed to European countries on Monday to confront what she described as a Russian attempt to impose control on her nation.

President Salome Zourabichvili was speaking after a fourth night of clashes between protesters and police after the governing Georgian Dream party announced last week that it was suspending talks on joining the European Union.

Critics saw that as confirmation of a Russian-influenced shift away from pro-Western policies and back towards Moscow’s orbit, something the ruling party denies.

“We want our European destiny to be returned to us,” Zourabichvili, who has personally remonstrated with riot police, told France Inter radio. “This is the revolt of an entire country.”

Zourabichvili, whose powers are mainly ceremonial, said Russia, already at war in Ukraine, was conducting a “hybrid strategy” against Georgia and other countries such as Moldova and NATO and EU member Romania.

“There is a very strong need for very clear moral and political support” from Europe, said the 72-year-old president, who was born in France to Georgian parents and once served as French ambassador to Georgia.

Kremlin spokesman Dmitry Peskov denied Russia was interfering in the situation in Georgia, which he compared to the 2014 “Maidan” revolution in Ukraine that overthrew a pro-Russian president.

Former Russian president Dmitry Medvedev warned on Sunday that Georgia was “moving rapidly along the Ukrainian path, into the dark abyss”, predicting it would end “very badly”.

The United States and the EU have voiced alarm at what they see as democratic backsliding by Georgia, a South Caucasus country of 3.7 million people that lies at the intersection of Europe and Asia and was once part of the Soviet Union.

The government, which earlier this year enacted a law against “foreign agents” and introduced curbs on LGBT rights, say it is acting to protect Georgia against outside interference and prevent it from being dragged, like Ukraine, into a war with Russia.

Prime Minister Irakli Kobakhidze accused the opposition of “coordinated violence” aimed at overthrowing the constitutional order.

FIREWORKS AND TEAR GAS

On Sunday night, thousands of protesters gathered again in the capital Tbilisi and some tossed fireworks at police, who responded with volleys of water cannon and tear gas.

“I’m here for a very simple reason, to defend my European future and the democracy of my country,” said one of the demonstrators, Nikoloz Miruashvili.

Some protesters stayed out all night, but police eventually ended the standoff by moving them away from the parliament building.

Georgia’s interior ministry said 21 police officers had been injured in the overnight protest, with 113 hurt since the beginning of the current unrest.

Scores of protesters have also been injured in recent days, and the United States has condemned what it called the excessive use of police force.

Georgia’s public ombudsman said 124 out of 156 people arrested at rallies had complained of the police using violence against them, calling this a “very disturbing number”.

Zurab Japaridze, a leader of the opposition movement Coalition for Change, was briefly detained by police but later posted on social media that he had been released.

Hundreds of diplomats and civil servants have signed open letters protesting the decision to suspend talks with the EU and stop receiving any funds from the bloc for four years. At least four Georgian ambassadors have resigned.

Ilia Topuria, a martial arts fighter with a major following in the country, wrote in an Instagram post: “I am opposed to the decision to terminate our accession negotiations to the European Union. I am ashamed to see how the children of Georgia are treated. This is not called freedom.”

Zourabichvili says she will not step down as president when her term expires this month because the parliament that will select her successor was chosen in October elections that the opposition says were rigged.

The election commission says the vote was fair. Prime Minister Kobakhidze on Sunday said Zourabichvili was reacting emotionally to the opposition’s election defeat and would have to leave the presidential palace at the end of the month.
 

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The Hague, Netherlands:

The Dutch data protection watchdog said Monday it hit ride-hailing app Uber with a 290-million-euro ($324 million) fine over the transfer of personal data of European drivers to US servers.

The regulator said the transfers were a “serious violation” of the European Union’s General Data Protection Regulation (GDPR) as they failed to appropriately protect driver information.

“Uber did not meet the requirements of the GDPR to ensure the level of protection to the data with regard to transfers to the US. That is very serious,” Dutch Data Protection Authority (DPA) chairman Aleid Wolfsen said in a statement.

The DPA said Uber collected sensitive information of European drivers, including taxi licences, location data, photos, payment details, identity documents, “and in some cases even criminal and medical data of drivers”.

Over a two-year period, the DPA said, the information was transferred to Uber’s US headquarters without using transfer tools.

“Because of this, the protection of personal data was not sufficient,” the DPA said.

Uber said it would appeal the fine.

“This flawed decision and extraordinary fine are completely unjustified,” an Uber spokesperson said in a statement

“Uber’s cross-border data transfer process was compliant with GDPR during a 3-year period of immense uncertainty between the EU and US. We will appeal and remain confident that common sense will prevail,” the statement said.

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Paris:

Some 60 media and rights organisations on Monday urged the European Union to suspend a cooperation accord with Israel and impose sanctions, accusing it of “massacring journalists” in Gaza.

“In response to the unprecedented number of journalists killed and other repeated press freedom violations by the Israeli authorities since the start of the war with Hamas, Reporters Without Borders (RSF) and 59 other organisations are calling on the European Union to suspend its Association Agreement with Israel and to adopt targeted sanctions against those responsible”, the groups said in a joint statement.

The call came ahead of a meeting by EU foreign ministers in Brussels on August 29.

The period following Hamas’s attack on Israel on October 7, 2023, and Israel’s devastating retaliatory assault on the Gaza Strip “has been the deadliest for journalists in decades”, the letter said.

“More than 130 Palestinian journalists and media professionals have been killed by the Israeli armed forces in Gaza since 7 October. At least 30 of them were killed in the course of their work, three Lebanese journalists and an Israeli journalist have also been (killed) during the same period”, it says.

“The targeted or indiscriminate killing of journalists, whether committed deliberately or recklessly, is a war crime”, it said.

EU’s association agreements with non-member countries are treaties that govern bilateral relations, including trade.

The agreement’s Article 2 stipulates “respect for human rights and democratic principles”, said Julie Majerczak, the head of RSF’s Brussels office.

“The Israeli government is clearly trampling on this article. The EU, which is Israel’s leading trade partner, must draw the necessary conclusions from this and must do everything to ensure that Prime Minister Benjamin Netanyahu’s government stops massacring journalists and respects the right to information and press freedom by opening media access to Gaza,” she said.

Among the signatories were the Committee to Protect Journalists (CPJ) and Human Rights Watch (HRW).

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The European Union’s Carbon Border Adjustment Mechanism (CBAM) will impose an additional 25 per cent tax on energy-intensive goods exported from India to the EU, a new report said on Wednesday.

This tax burden would represent 0.05 per cent of India’s GDP, according to the report titled “The Global South’s Response to a Changing Trade Regime in the Era of Climate Change” by the independent think tank Centre for Science and Environment (CSE).

These findings are based on data from the past three years (2021-22, 2022-23, and 2023-24). CBAM is the EU’s proposed tax on energy-intensive products, such as iron, steel, cement, fertilizers, and aluminium, imported from countries like India and China. The tax is based on the carbon emissions generated during the production of these goods.

The EU argues that this mechanism creates a level playing field for domestically manufactured goods, which must adhere to stricter environmental standards, and helps reduce emissions from imports. But other nations, particularly developing countries, are worried this would harm their economies and make it too expensive to trade with the bloc.

The move has also sparked debate at multilateral forums, including UN climate conferences, with developing countries arguing that, under UN climate change rules, countries cannot dictate how others should reduce emissions.

Avantika Goswami, who leads CSE’s climate change programme, said that India’s CBAM-covered goods exports to the EU accounted for 9.91 per cent of its total goods exports to the bloc in 2022-23. She said 26 per cent of India’s aluminium and 28 per cent of its iron and steel exports were destined for the EU in 2022-23. These sectors dominate the basket of CBAM-covered goods shipped from India to the EU.

In 2022-23, the exports of CBAM-covered goods to the EU made up about one-fourth (25.7 per cent) of India’s total such goods exported globally, which is significant for the industries operating in these sectors. Currently, hydrogen and electricity are not exported from India to the EU. Of India’s total goods exported worldwide, CBAM-covered goods exports to the EU constitute only about 1.64 per cent.

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London:

European Union (EU) regulators on Monday opened a new investigation into Apple’s support for alternative iOS marketplaces in Europe under the Digital Markets Act (DMA), adding that the App Store’s “steering” policies violate the DMA meant to encourage competition.

Margrethe Vestager, who heads competition policy in Europe, said their preliminary position is that Apple does not fully allow steering.

“Steering is key to ensure that app developers are less dependent on gatekeepers’ app stores and for consumers to be aware of better offers,” she said in a statement.

The EU regulators said they are concerned as Apple’s new business model makes it too hard for app developers to operate as alternative marketplaces and reach their end users on iOS.

“We will look into Apple’s new business model – the commercial terms Apple imposes on app developers who want to reach end users on the iOS platform,” said the regulators.

The regulators also said that they have adopted their first preliminary findings in a case of non-compliance.

“And it is again about Apple. About the many ways in which their new terms fall short of the DMA requirements regarding steering users to options outside the Apple App Store. As they stand, we think that these new terms do not allow app developers to communicate freely with their end users, and to conclude contracts with them,” they added.

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Brussels:

EU antitrust regulators on Monday opened their first investigations under the Digital Markets Act into Apple, Alphabet’s Google and Meta Platforms for potential breaches of the landmark EU tech rules.

“The (European) Commission suspects that the measures put in place by these gatekeepers fall short of effective compliance of their obligations under the DMA,” the EU executive said in a statement.

The EU competition enforcer will investigate Alphabet’s rules on steering in Google Play and self-preferencing on Google Search, Apple’s rules on steering in the App Store and the choice screen for Safari and Meta’s ‘pay or consent model’.

The Commission also launched investigatory steps relating to Apple’s new fee structure for alternative app stores and Amazon’s ranking practices on its marketplace.

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Paris:

French President Emmanuel Macron on Friday said France would not rest until the right to abortion, now protected by the French constitution in a world first, was guaranteed in the EU’s rights charter and around the globe.

Macron spoke as hot wax was sealed to a constitutional amendment to formerly inscribe the right to abortion.

The ceremony on International Woman’s Day came after parliament gave its final assent earlier this week.

“France today becomes the only country worldwide whose constitution explicitly protects the right to abortion in all circumstances,” Macron said in front of the justice ministry in the Place Vendome in central Paris.

But “we will not rest until this promise is held everywhere in the world.”

Abortion has been legal in France since 1975, but Macron last year pledged to better protect it after the US Supreme Court in 2022 overturned the United State’s half-century-old right to the procedure, leaving it up to individual states to decide.

In a historic vote, a rare congress of both houses of France’s parliament on Monday gave a green light towards making terminating a pregnancy a “guaranteed freedom” in the basic text, sparking celebration among feminists.

“Today is not the end of the story. It’s the start of a fight,” Macron said.

In Europe, “nothing is set in stone any longer and everything has to be defended,” he said, alluding to “reactionary forces” in other parts of the continent.

“This is why I wish for this guaranteed freedom to resort to an abortion to be inscribed in the European Union’s Charter of Fundamental Rights,” he said.

The sealing ceremony came a year to the day after the president promised to constitutionalise the right.

Justice Minister Eric Dupond-Moretti turned the handle of a 300-kilo (660-pound) 19th century press to stamp a green wax seal on a ribbon attached to the official amendment document.

The sealing is a purely ceremonial procedure, and the amendment will only come into force after its publication in the “Journal Officiel” of new laws.

‘Serve as an example’

The constitutional change has been backed by most of the French public, even if some conservatives remain against it, arguing it’s not a constitutional issue.

No country had so far as clearly safeguarded the right to a pregnancy termination in its basic text, according to Leah Hoctor, of the Center for Reproductive Rights.

Some countries allude to the right, while others explicitly mention abortion, but only in certain circumstances.

Neil Datta, of the European Parliamentary Forum for Sexual and Reproductive Rights, said the French move sent a strong signal.

It “could give momentum to improving abortion legislation, just as the reversal of Roe v. Wade in the United States gave some to anti-abortion groups worldwide,” he said.

France “could serve as an example for progressives in all countries of Europe and beyond to define a course,” he said.

Even without amending the constitution, “they could… improve their legislation.”

National Assembly speaker Yael Braun-Pivet — the first woman in the post — read out the result of Monday’s historic vote, with 780 lawmakers in favour and 72 voting against.

More than 20 of her fellow women parliament speakers from around the world were also in Paris to attend the ceremony.

The last time the seal was used was in 2008, when lawmakers only just approved wide-sweeping amendments under former president Nicolas Sarkozy.

Those changes included limiting a president’s time in office to two terms, as well as better safeguards for press independence and freedom.

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Istanbul, Turkey:

Turkish President Tayyip Erdogan said on Saturday that Ankara could “part ways” with the European Union if necessary when asked about the contents of a European Parliament report on Turkey.

The report, adopted earlier this week, said Turkey’s accession process with the 27-member bloc cannot resume under current circumstances and called for the EU to explore “a parallel and realistic framework” for its ties with Ankara.

Turkey has been an official candidate to join the EU for 24 years, but accession talks have stalled in recent years over the bloc’s concerns about human rights violations and respect for the rule of law.

“The EU is trying to break away from Turkey,” President Erdogan told reporters ahead of a trip to the United States. “We will make our evaluations against these developments and if necessary, we can part ways with the EU.”

Turkey’s Foreign Ministry said earlier this week that the European Parliament report contained unfounded allegations and prejudices and took “a shallow and non-visionary” approach to the country’s ties with the EU.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)