It is worrying that Hungarian prime minister, Viktor Orban, seems set on dealing Ukraine a double whammy at this month’s EU council meeting. He has warned that he will veto plans for the EU to give Ukraine a green light on EU accession, along with EUR50bn in funding for the period 2024-27.

Both would be critical blows to Ukraine’s ability to fund their continuing defence against Russian aggression and to ensure successful recovery and long term development - key to its and actually Europe’s defence against inevitable future Russian aggression.

The lack of EU accession perspective has been the number one break on Ukraine’s economic development over the past 30 years compared to the rest of Emerging Europe. 

I always use the example that Polish, Russian and Ukrainian per capita GDP were comparable in the early 90s, at the outset of transition, at around $3,000 per capita. But by 2013, Poland and Russia’s had risen to $14k but Ukraine’s was still around $3k. Reason? Russia has the commodity price windfall.

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Poland benefited from the EU accession trade/anchor for reform after the EU green lighted it’s accession with ten other prospective Eastern European members in 1994 at the Treaty of Copenhagen, for 2004. It had a blueprint for reform, ticked all the boxes, rolled out the reforms and transformed. Same story actually also for Hungary.

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Ukraine, by contrast, was caught between two systems - neither commodity price beneficiary (it was an importer) and no EU accession anchor. It was in a twilight zone between East and West with no anchor and no real rule of law - exploited by its oligarchic class, rent seeking and enriching themselves at the expense of their populations.

I would also just point out that Orban now says Ukraine is in no position to be given that same EU accession perspective that Hungary was given in 1994 - so he is saying it is back from where Hungary was in 1994. No way! I was a transition economist back then - regularly visiting Hungary, Ukraine and the region - and no way is Ukraine less prepared than Hungary was back then. I would actually say it is now far advanced in so many aspects.

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Now Orban knows all the above as Hungary was gifted the same track as Poland. He knows Ukraine needs that same EU accession development track. So why is he stalling on agreeing to give Ukraine that same EU accession development perspective? In whose real interest is he acting? But keeping Ukraine under-developed, economically weak means social problems and political instability going forward. Putin wins from that, so why would Hungary want that weak Ukraine on its border?

I cannot think it is just about the EUR30bn plus in stalled EU funding to Hungary. What is Orban’s real agenda here?

Surely it’s either he is in cahoots with Putin - sharing his illiberal outlook for Europe and the world which is very different to the current EU values set. Or it is about the money. Or he fears a strong and successful Ukraine on his own border for some other reason, given his own issues around the Hungarian minority in Ukraine.

On the latter just thinking thru what Ukraine’s defeat in the war waged by Russia, or failure to reconstruct post war means? I would say it risks social and political instability in Ukraine - mass out migration of tens of millions of Ukrainians. It makes me wonder here is Orban’s game plan exactly that - creating conditions for a failed state in Ukraine would then enable a Hungarian land grab with Putin of territory in Ukraine with Hungary taking land where ethnic Hungarians currently reside.

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Any other explanations for Hungary doing the dirty on Ukraine, and trouncing the memory of 56’?

What am I missing?

Reprinted from @tashecon blog. See the original here.

The views expressed in this opinion article are the author’s and not necessarily those of Kyiv Post.

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