Impact of Ukraine Crisis on Poland-Hungary Differences with EU

2022/03/08 | interview, political, top news

Strategic Council Online - Interview: An expert on Europe affairs, saying that with the EU ruling to punish Poland and Hungary financial challenges will severely affect the two countries, noted: It seems that given the geopolitical developments in Eastern Europe and parliamentary elections In Hungary this year, the European Union will show more flexibility in implementing this ruling.

Ebrahim Bagheri, in an interview with the website of the Strategic Council on Foreign Relations, while referring to the confirmation of the ruling for the punishment of Poland and Hungary by the European Court of Justice, said: Early in 2020, the European Union adopted a regulation entitled “Rule of Law Conditionality” for the EU budgetary package for 2021-2027, which made any funding from the EU budget conditional on member states respecting the rule of law.

Explaining the EU’s accepted definitions of “rule of law”, including the independence of the judiciary, freedom of universities and freedom of the media, he added: Despite some differences in 2015 between the EU and some member states, including Poland and Hungary, regarding the admission quota for immigrants, amendments were made to the judicial laws in Poland in 2021, according to which the domestic laws of Poland took precedence over the laws of the European Union.

The expert on Europe affairs called the independence of the judiciary, freedom of the media and the university among the most important issues criticized by the European Union, and said: The European Union has announced that until the EU’s reform concerning the rule of law is not implemented, the two countries’ budgets from the European Union and EU preferential loans, with an aim of restoring the economies of member countries due to the Coronavirus conditions, are suspended.

Possibility of suspending enforcement of court ruling against Poland, Hungary

Bagheri continued: The European Commission can now put those regulations into operation and cut the budgets of the two countries from 2021 to 2027 as well as their preferential loans, but it seems that given the geopolitical developments that have taken place in Eastern Europe and the parliamentary elections in Hungary this year, the European Union will suspend implementation of the law and will show more flexibility until the direction of developments is clarified.

Referring to the remarks of the President of the European Commission, Ursula von der Leyen, he added: Although she has stressed that by protecting the Union’s budget, countries that violate the rules and values ​​of the Union will not be funded; at the same time, announced efforts to compromise with the two countries and stressed the need to pay attention to the possible consequences of such punishments.

Rising gap in EU

Explaining the consequences of the suspension of financial aid to Hungary and Poland, the European affairs analyst said: Given the security crisis that Europe is currently faced with, such punishments will widen the gap in the EU. For this reason, the EU is likely to show more flexibility for compromising with the two member states, and given the escalating security threats in Eastern Europe, which have been heightened by the Ukraine war, Poland and Hungary will also implement some EU demands.

Bagheri continued: Poland and Hungary have accused Brussels of extortion, abuse of power, political revenge and violation of national sovereignty, and threatened to take retaliatory measures against EU decisions that require unanimity, especially in areas such as climate, foreign policy and energy. Of course, we have already seen Poland preventing issuance of several joint statements by Europe. The two countries have also threatened to withdraw from some European treaties and conventions.

Referring to the consequences of escalating tensions between Poland and Hungary with the European Union, he stressed: If no compromise is reached between them which, of course seems unlikely, Poland will be deprived of receiving 76 billion euros and Hungary 24 billion euros from the EU Cohesion Fund until 2027. The EU’s vision for the 2021-2027 budgetary fund has allocated budgets and loans to member states under various headings, including; the EU Cohesion Fund, the national recovery plan with an aim of compensating for the Coronavirus damage to the economy of member states, climate issues, the REACT-EU Fund, as well as the budget for agricultural policies.

Bagheri added: Poland’s total share of the budget is about 120 billion euro and Hungary’s share is 40 billion euro. Therefore, if no compromise is reached, the two countries will lose 70% of the budget and preferential loans.

The expert on Europe affairs referred to the threats of Poland and Hungary to leave the European Union and said: Given the security threats that Europe is faced with under the current situation, it is acting more cautiously in implementing its policies. In fact, the union will wait to see if the ruling far-right party in Hungary will survive the April 3 elections.

Explaining the “Dublin rules” on the need to accept asylum seekers, Bagheri continued: Given the situation in Ukraine and the estimated entry of up to 5 million migrants into Europe if the war continues, it seems that in case the two countries do not accept the least quota of 150,000 approved by the European Commission, the challenges will increase, which can have a negative effect on the suspension of punishments. However, given the situation in Eastern Europe and Europe’s need for cohesion and convergence, it is anticipated that a compromise will be reached between them to curb centrifugal tendencies under the current situation.

Consequences of cancellation of financial aid for Poland, Hungary

He noted: With the implementation of the ruling of the European Court of Justice financial challenges will severely affect Poland and Hungary, and it is predicted that by the end of 2022, the GDP of the two countries will reduce by one percent. Given the economic conditions and challenges of the two countries, such rulings will have far-reaching consequences for their exchange rates and economies.

Emphasizing that Poland and Hungary also have some leverage to put pressure on Europe, Bagheri said: Given the Ukraine crisis and security in Eastern Europe, it seems that we will see efforts for convergence in Europe and the two sides will try to show more flexibility, but with the continued presence of the far-right in Hungary, we will be witness to challenges along the way.

The expert on Europe affairs, while emphasizing the need to pay attention to the effects of far-right actions in Europe, continued: However, given the Russian threat and the security situation, Poland and Hungary will make changes to their domestic laws in accordance with the request of the European Union and avoid further divergence and challenge with the EU.

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