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The European Union’s executive is expected to recommend on Sunday the suspension of billions of dollars in funds for Hungary over corruption, the first such case in the bloc under a new “cash for democracy” sanction intended to better protect the rule of law.
The EU introduced the new financial penalty two years ago precisely in response to what it says amounts to undermining democracy in Poland and Hungary, where Prime Minister Viktor Orban subjugated the courts, the media, NGOs and the world academic, in addition to restricting the rights of migrants. , gays and women for more than a decade in power.
The blog has also long denounced Hungary’s public procurement laws for insufficient anti-corruption safeguards that return an excessive rate of single bidders and fuel corruption.
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The Brussels-based European Commission was meeting from 06:30 on Sunday and expected to approve a proposal to suspend up to a tenth of Hungary’s economic funds from the bloc’s shared budget for 2021-2027 for a total of 1.1 trillion dollars.
The proposal would go to EU member states and they would have up to three months to decide on it by majority vote, meaning no country can block the punishment as was the case with the bloc’s previous and ineffective democratic watchdog.
Orban, who calls himself a “freedom fighter” against the worldview of the liberal West, denies that Hungary – an ex-communist country of about 10 million people – is more corrupt than others in the EU.
EU Budget Commissioner Johannes Hahn announces plans for the EU to withhold funds from Hungary until the country is able to demonstrate that corruption is under control, in a speech in Brussels, Belgium, on September 18 of 2022.
(REUTERS/Hedy Beloucif)
It has long refused to change its laws but has now come under pressure to strike a deal with Brussels to secure money for its ailing economy and the forint, the worst-performing currency in the east of the EU.
CORRUPTION
The Commission is already blocking some $6 billion in funds planned for Hungary in a stimulus separate from the economic recovery from COVID, saying the money would otherwise be at risk of being misused.
Reuters documented in 2018 how Orban funnels EU development funds to his friends and family, a practice that human rights organizations say has greatly enriched his inner circle and allowed the 59-year-old to entrenched in power.
Hungary had irregularities in almost 4% of the spending of EU funds in 2015-2019, according to the bloc’s anti-fraud body OLAF, by far the worst result among the 27 EU countries. OLAF said in 2016 that Budapest should pay more than $280 million spent on the Budapest Metro because of “fraud and possible corruption”.
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But complex procedures and political wrangling allowed Hungary to avoid major financial punishment since joining the bloc in 2004, something that may no longer be the case when the EU tests its new preventive sanction.
Orban has also rubbed many in the bloc the wrong way by cultivating close and continued ties to President Vladimir Putin and threatening to deny the EU unity needed to impose and preserve sanctions on Russia for waging war against Ukraine.
