EU 'shooting itself in foot' Hungary blasts bloc over economic crisis as Putin hits back

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EU 'shooting itself in foot' Hungary blasts bloc over economic crisis as Putin hits back

EU leaders agreed to four packages of sanctions against Russian President Vladimir Putin in response to Russia's attack on Ukraine. But as the Russ

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EU leaders agreed to four packages of sanctions against Russian President Vladimir Putin in response to Russia’s attack on Ukraine. But as the Russian leader prepares to hit the West back with counter-sanctions, Hungary, which has called for less strict measures from Brussels, is warning of another upcoming economic crisis for the bloc.

Speaking to Express.co.uk, Hungarian Secretary of State for international communication Zoltan Kovacs claimed Brussels’ relentlessly slow and ineffective approach to crises will once again plunge the bloc into economic abyss.

Mr Kovacs argued that his country has always had a faster and better response to crises jeopardising the existence of the EU compared to the EU Commission itself.

Calling for his EU counterparts to stay out of the war by refusing to provide Ukraine with military support, Mr Kovacs said: “You have to think about, first of all the 2008/2009 fiscal and economic crisis, which still is in some respect not over.

“There was a lot of criticism going against the Commission, the European Union, that it was not responding and answering well to the challenges posed by that.

“Then we’ve seen mass migration in 2015 and Covid coming two years ago.

“I can tell you that the Hungarian response to all of these challenges was more immediate and more effective than what we’ve seen on behalf of Europe.

“And we see that even today, when we talk about the sanctions against Russia because of the war, Russia has also started with sanction policies that are going to have most possibly a very negative economic effect

“They will probably cause another major economic crisis.

“So that’s why we maintain that, especially when the war is raging in our neighbourhood, that it is not our war.

“You have very careful about that, think about your own interests, and that is the national interests.

“Hungary is also representing the European interest all together because any misstep, any bad idea can result in something more serious than you intend.

“And that is how you shoot yourself in the foot.”

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European governments and companies were working on Friday on a common approach to President Vladimir Putin’s demand that they pay for Russian gas in rubles as the threat of an imminent halt in supplies eased.

European capitals have been on alert for a disruption to gas imports for weeks as Putin seeks retaliation over the West sanctioning Russia for invading Ukraine.

A crunch point appeared to be in the offing when Moscow issued a decree on Thursday requiring foreign buyers of Russian gas to open ruble accounts in state-run Gazprombank from Friday or else risk being cut-off.

The Kremlin said on Friday it would not immediately turn off gas exports to Europe as payments on deliveries due after April 1 come in the second half of this month and May.

With weeks left before bills are due, governments in Europe, which relies on Russia for more than a third of its gas supply, were talking to their energy companies about how to pay them.

“Working closely with Member States and operators. EU coordination today to establish a common approach on currency payments for gas contracts with Russia,” Ditte Juul Jorgenesen, director general of the European Commission’s energy division tweeted.

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Energy exports are Putin’s most powerful lever as he tries to hit back against sweeping Western sanctions but his room for manoeuvre is also limited because Moscow does not have alternative markets for its gas, which is piped to Europe.

“If Putin turns off the gas it might only be for a relatively short period of time, he needs our money and cannot reroute all the natural gas,” said one European gas trader, who declined to be named.

Analysts said the plan, which cements Gazprom’s position at the heart of Russian gas trading, was more about shielding the oil and gas company from future sanctions than depriving Europe of much needed fuel.

“It is of course a game to dodge sanctions, adding to uncertainty, propping up gas prices and filling Putin’s pockets,” a second trader said.

Germany said it was examining Putin’s decree, with an economy ministry spokesperson saying private contracts were valid and that the country was paying in euros for Russian gas.

Germany, which depends on Russia for 40 percent of its gas needs, has already activated an emergency plan that could lead to gas rationing if supplies drop too low.

Gazprom said on Friday it was exiting its business in Germany. It was not immediately clear how the move would affect the supply of Russian gas into Europe’s largest economy.



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