European Union agrees new 50 billion euro aid package for Ukraine

The leaders of the 27 European Union countries sealed a deal on Thursday to provide Ukraine with a new 50 billion euro support package for its war-ravaged economy after Hungary backed down from its threats to veto the move.

European Council President Charles Michel announced the agreement that was reached in the first hour of a summit that he was chairing in Brussels.

“We have a deal,” Mr Michel tweeted.

He said the agreement “locks in steadfast, long-term, predictable funding for Ukraine,” and demonstrated that the “EU is taking leadership and responsibility in support for Ukraine; we know what is at stake”.

Ukrainian President Volodymyr Zelensky welcomed it as a “very important” decision. His country could receive the first tranche of funds as soon as March, once the European Parliament has endorsed the deal.

That Hungary lifted its veto, and so quickly, came as a surprise.

Hungarian prime minister Viktor Orban raised staunch objections to the financial aid package in December and in the days leading up to Thursday’s summit in Brussels.

On the eve of the summit, Mr Orban tweeted: “We will stand up for the voice of the people! Even if the bureaucrats in Brussels blackmail us.”

On Thursday he cast the decision as a victory, saying in a video on Facebook that a review mechanism attached to the funding package would “guarantee the rational use of the funds”, and that EU money being denied to Budapest would not be spent on Ukraine.

“We were afraid that the EU money owed to Hungarians which the commission has not given us yet would sooner or later end up in Ukraine,” he said. “We received a guarantee that Hungary’s money would not be transferred to Ukraine.”

Almost two years after Russia’s invasion of Ukraine, the war has ground to a halt and Ukraine’s economy desperately needs propping up.

But political infighting in the EU and in the United States is depriving Kyiv of a long-term source of funding.

Concern has mounted that public support to keep pouring money into Ukraine has started to wane, even though a Russian victory could threaten security across Europe.

“There is no problem with the so-called Ukraine fatigue issue. We have Orban fatigue now in Brussels,” Polish prime minister Donald Tusk earlier told reporters at the EU summit.

“I can’t understand. I can’t accept this very strange and very egoistic game of Viktor Orban.”

In December, the 26 other leaders agreed on an aid package worth 50 billion euros for this year through to 2027. They also agreed to make Ukraine a candidate for EU membership, which Mr Orban reluctantly accepted.

But the financial package is part of a review of the EU’s continuing seven-year budget, which must be approved unanimously.

An EU official said the leaders agreed that the bloc’s executive branch, the European Commission, would propose a review of the budget in two years, if deemed necessary.

Such a review would not include an opportunity for a future veto, he added.

Mr Orban, the EU leader with the closest ties to Russia, is angry at the European Commission’s decision to freeze his government’s access to some of the bloc’s funds.

The executive branch did so over concerns about possible threats to the EU budget posed by democratic backsliding in Hungary.

In response, Hungary vetoed statements at the EU on a range of issues.

Mr Orban also exported the problem to Nato, by blocking high level meetings with Ukraine until only recently. Budapest is also holding up Sweden’s bid for membership.

“I don’t want to use the word blackmail, but I don’t know what other better word” might fit, Estonian prime minister Kaja Kallas told reporters as she arrived at EU headquarters in Brussels.

“Hungary needs Europe,” she said, highlighting the country’s own economic problems and high interest rates. “He should also look into what it is in it for Hungary, being in Europe.”

Mr Zelensky is scheduled to address the leaders via video link.