EU finds £17bn funding ‘workaround’ for Kyiv that Orban cannot block

THE European Union has drawn up a £17.4 billion workaround fund to overcome Hungary’s opposition to further support for Ukraine, it has emerged.

Officials were forced to prepare the “Plan B” after Viktor Orban, the prime minister of Hungary, vetoed a £43.5 billion aid package for Kyiv at a EU leaders’ summit in Brussels earlier this month.

Under the new plan, member states would issue guarantees to the bloc’s shared budget to allow the European Commission to borrow money for Ukraine on international markets, the Financial Times reported. Support from Brussels is seen as crucial for propping up Ukraine’s economy while US President Joe Biden’s own aid package remains blocked and a slowdown in Western support has forced Kyiv to downsize military operations.

The Kremlin said any fresh attempts to aid Kyiv would not change the course of the war and would only hurt the bloc’s economy. Dmitry Peskov, the Kremlin spokesman, said it was up to the EU’S taxpayers to realise their money was being misspent.

While the latest scheme is expected to deliver less than the £43.5billion originally promised, it cannot be blocked by Hungary when EU leaders reconvene for emergency talks on Feb 1. It only requires member states to agree to lend a guarantee for the planned loans.

Some countries, including Germany and the Netherlands, would have to secure backing from their national parliaments for the plan.

One downside discussed by officials is that the workaround would only provide low-cost loans to Ukraine, and not grants that do not need to be repaid.