EU Kickstarts Process to Deny Hungary Funds Over Rule of Law - Yahoo Finance
(Bloomberg) -- The European Union is triggering its previously untested rule-of-law powers against Hungary, starting a process that could ultimately deny newly re-elected Prime Minister Viktor Orban more than 40 billion euros ($43.9 billion) in EU funding.
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The bloc’s executive decided to unleash the so-called conditionality mechanism for reining in nations that violate the EU’s core values after failing to secure necessary changes from Hungary, European Commission President Ursula von der Leyen told lawmakers on Tuesday.
“Our conclusion is we have to move on to the next step,” von der Leyen said at the European Parliament in Strasbourg. “We will now send the letter for formal notification to start the conditionality mechanism.”
The forint plunged 2% against the euro following the EU’s announcement, by far the biggest daily currency drop globally.
The move follows Orban’s crushing election victory on Sunday, when he clinched a fourth consecutive term to extend his run as the EU’s longest-serving premier. Orban defeated a largely united opposition that had pledged to roll back more than a decade of power consolidation and to restore frayed ties with the EU.
The EU is making a mistake when it “blows the same tune” as the Hungarian opposition, Hungarian Cabinet Minister Gergely Gulyas told state news service MTI in response to von der Leyen’s announcement. Brussels shouldn’t punish Hungarian voters for the election result, he told MTI.
Justice Minister Judit Varga said on Facebook that the government “is not engaged in political declarations and awaits formal notification with concrete details” and “if there is one, we will of course respond to it.”
source: https://finance.yahoo.com/news/eu-kick-starts-process-deny-143012671.html
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