Thread by @Mij_Europe

The EU's geopolitical contribution to 🇺🇦 war was meant to be € & EU integration, while US would lead on the harder (military) stuff. But these 2 pillars of EU support are now unravelling ahead of Dec EU leaders meeting

What's going on? Only read if you want to be depressed 1/

The big prob with € for Ukraine is Germany's fiscal mess, following its constitutional court ruling that €bn parked in off budget vehicles - designed to circumvent strict fiscal rules - are illegal. The big prob w Ukraine's EU path is Hungary. Lets start with latter first 2/

Opening membership negotiations with Ukraine is unanimity. Senior EU officials tell me in order to lift his veto, Orban wants:

-A strategic debate over EU's approach to Ukraine;
-€bn released from Bxl (withheld due to corruption);
-Removal of @vonderleyen after EU elections 3/

-A sweet position for next Hungarian Commissioner when next @EU_Commission forms on 1 Nov 2024;
-Opening of membership negotiations with Bosnia-Herzegovina & acceleration of Western Balkans EU path

Look at this letter outlining some of Orban's demands. Take a deep breath 4/

This creates loads of problems

Prob 1: Orban wants much more than money. So EU's old trick of blackmailing him with €bn isn't likely to work this time. It'll help, but won't be enough

This not least bc EU isn't going to be able to release anywhere near amount Orban wants 5/

Bxl is currently withholding around €37bn from Hungary from three different pots. But only a tiny fraction of this is likely be be released. Why? Bc if @vonderleyen tries to do a dirty deal & unlock more she'll alienate @Europarl_EN whose support she needs for a second term 6/

Prob 2: Some of Orban's concerns re Ukraine are seen as legit & even backed up by Venice Commission. The most imp relates to protection of Hungarian minorities in Ukr. @EU_Commission also agrees more needs to be done here before negs can actually begin 7/

neighbourhood-enlargement.ec.europa.eu/system/files/2…

Prob 3: Many member states share Orban's reservations - about pace at which Ukraine's EU path is progressing - & are conveniently hiding behind Hungary's opposition. Senior EU officials suggest Austrians, Dutch, Greeks, It, Spain, even Poles, French & others sit in this group 8/

As one senior EU official says of Orban's letter “He is saying that on Ukraine, the EU king is naked. Maybe he has a point”

Officials cite suite of unanswered Qs re Ukraine's EU path - contested borders, budgetary impacts, referenda related risks, EU absorption capacity etc 9/

One senior EU official muses over whether EU agri subsidies wd be paid to those parts of Ukr territory Russia currently controls

Concerns like these are being discussed in private but no member state/EU leader will dare air them in public. Not least as war gets bogged down 10/

I haven't been able to find even *one* senior EU official who believes there is a way through for a deal over Ukraine's EU membership prospects in Dec. Orban's opposition is implacable - & providing oxygen, and cover, for others to vent their concerns & for these to surface 11/

What about a deal in March next year? This when @EU_Commission will update on Ukr progress against 7 reforms & cd provide another opp to open accession negs w Kyiv. Perhaps. But officials are also gloomy: 2 months before EU elections, will leaders want to send that signal? 12/

Concern is it'll provide fodder for populists to play up risks of Ukr accession. Remember concerns in France over Polish plumbers? Or Dom Cummings' cynical lie over Turkish migrants in Brexit referendum? One only has to only look at @geertwilderspvv result in Dutch elex... 13/

To see why officials worry. Concern is if Ukraine doesn't get a deal in Dec, electoral constraints will then prevent it happening in March. Hungary has rotating presidency in last 6 months of next yr, so can't happen then. Before you know it, it's 2025. Momentum has been lost 14/

Money is no easier. Put simply: Germany is having to cut €bn from its budget this & next yr - in order of €20bn each yr. The economy was already on cusp of recession: implementing a pro-cyclical fiscal adjustment certainly wont help. A wobbly coalition just got wobblier 15/

In this context, how politically viable is it for Berlin to send more €bns to Bxl? @EU_Commission in July asked for additional €50bn for migration, EU response to US' IRA, emergencies, interest repayments, salaries for staff etc as well as €50bn for Ukraine until 2027 16/

Senior German officials were already skeptical about @EU_Commission non-Ukr €50bn demand but have always been & remain supportive over Ukraine aid. Their suggestion is to decouple (& sign off) Ukraine's €50bn from the @EU_Commission other requests 17/

But other EU capitals - It, Gr, Fr, Spain & many others don't think they can sell heading into EU elections €50bn for Ukr if all their other priorities aren't getting funded. Germany's answer: cut some of unused €430bn in cohesion funds to pay for these other priorities 18/

Berlin's request isn't unreasonable: only 2-3% of cohesion funds have been used so far & we're 1/2 way through current EU budget cycle (runs to 2027). But cohesion countries say they cant sell €50bn for Ukraine if at same time they'll be getting LESS than originally promised 19/

Back to Orban. This is clearly his moment of maximum leverage: all Ukraine issues on leader's table in Dec are unanimity (sanctions, financing & membership negotiations). He clearly wants to exert as much pressure as poss. Officials aren't clear it's game we've seen before 20/

Maybe there's still a deal to be done. But risk is the EU has lost/is losing sight of big picture - imp of its top line commitment/signal to Ukr - as countries squabble over budgetary resources & blackmail by Orban. What US said was the “EU's narcissism of small differences” ENDS