The new Hungarian government, led by Péter Magyar, has lifted its veto on the use of funds from the European Peace Facility (EPF), through which EU countries receive compensation for weapons supplied to Ukraine. The Hungarian ambassador announced Budapest’s change of position during a meeting of the EU Council’s Political and Security Committee, ending a two-year blockade imposed by former Prime Minister Viktor Orbán. It was reported by Politico, citing six European diplomats who confirmed the lifting of political restrictions that had held up financial payments since early 2023.
The European Peace Facility is a key off-budget EU instrument that reimburses member states for approximately 40% of the cost of weapons, tanks, ammunition, and air defense systems allocated to Ukraine from national arsenals. Since decisions within the fund require absolute unanimity, Hungary’s previous government consistently blocked payments, demanding political concessions from Kyiv. Due to Budapest’s stance, an artificial debt of over 40 billion euros to other EU members had accumulated, sparking serious outrage from major donors, particularly Germany and the Netherlands.
Hungary’s current move allows for the immediate release of the first EUR 6.6 billion for urgent payments. Commenting on the consequences of lifting the veto, one European diplomat noted that countries will now “finally receive some compensation, which will also make the burden-sharing more equitable.”
Budapest’s decision paves the way for stabilizing the funding system for European defense aid. EU defense ministers are expected to discuss the technical details and updated criteria for using these billions of euros in depth next week during an informal meeting in Cyprus. For its part, Ukraine is already calling on its partners to allocate part of the released funds to strengthening air defense, specifically for the procurement of Patriot air defense systems and missiles for them.
Foreign Minister Andrii Sybiha emphasized that these financial flows “can be used for purchases in the US under the PURL program, which is coordinated by NATO,” which will allow for much faster fulfillment of the Ukrainian army’s critical needs on the front lines. According to analysts, the lifting of the veto is an important part of the broader policy of Hungary’s new Prime Minister Péter Magyar to normalize relations with the EU, NATO, and Ukraine.
As a reminder, Hungarian Prime Minister Péter Magyar confirmed that his country will not send troops or weapons to Ukraine.
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