Norway, Iceland and Liechtenstein, all members of the European Economic Area, have denied funds to Hungary under the Norway Grants scheme. The decision came as Hungary has been accused of aiming for greater control over the funds and NGOs that would benefit from them.
The support has two categories: the distribution of the larger amount, the economic development money decided by the government, while funding for civil society goes to the NGOs.
The four countries have failed to come to an agreement on the latter, forcing the EEA states to withhold all funds upon they had already reached a deal.
According to EU expert Wolfgang Munchau, the move will put some pressure on the EU to issue sanctions on Viktor Orban’s government and put its foot down on withholding the recovery fund until Mr Orban addresses allegations of corruption.
The director of Eurointelligence claimed the Brussels bloc should follow suit and “stick to its guns”, with the help of the good example set by the EEA.
He wrote: “Norway has been one of the most vocal opponents of Viktor Orbán in recent years, and clashed frequently with the Hungarian government over civil society funding.
“This is not the first time it has suspended funding – it also turned off the taps in 2014 after the government used an audit and police raid to harass an organisation managing the disbursement of Norwegian funds.
“The European Commission has taken steps in the same direction in recent weeks, launching an infringement procedure over a recent anti-LGBTQI bill. This prompted Orbán to announce he would hold a referendum on the law, after accusing Brussels of holding up approval of Hungary’s national recovery plan – and billions of EU money – over the law.
“The Commission has said delays are owing to concerns over lack of anti-graft measures in place in Hungary.
READ MORE: Britain sees fastest economic growth in 80 years… as EU left lagging
“A crackdown on these organisations could be argued to be damaging those interests.
“But this does not mean the mechanism would offer any sort of a speedy resolution. The Court of Justice must give its judgment on any such procedure, and it is not exactly known for moving quickly.
“By acting before a problem occurs, the EEA has set a good example. The EU should follow suit and stick to its guns.”
On Friday, Mr Orban threatened to go solo on the speedy refunding of his country’s recovery if the EU failed to pay him out.
He told local radio on Friday: “The most important feature of the recovery programme is that it is fast, so that we in the European Union have set up these resources at an unusually fast pace as soon as possible.
“To delay – now I see that the European Union will be asking for a two-month postponement to continue the negotiations – is questioning the very meaning of the recovery fund.
“What can the Hungarian government do? Of course, this money is ours, it belongs to us. There is not much debate about this, they can delay it, but they cannot refuse to give it up, because this is – I say again – not a gift, but it comes to us, as we pay into the Union’s budget, we have now undertaken to implement the Union’s long-term economic policy, consequently, this amount is due to us.
“But time matters. Therefore, the government has decided to create a recovery fund, the Hungarian recovery fund, within the economic protection fund, and we will now launch the same programs that we have already partially approved with Brussels.”
He added: “Today, the Minister of Finance will come to me to discuss the details of this, we will launch these programs, and if money comes from Brussels, if not, we will pay this out of the Hungarian budget.”