Hungary’s choice between Brussels and Washington

Arm twisting with EU funding

At least since the coronavirus pandemic, but especially since the start of the war in Ukraine, Hungarian Prime Minister Viktor Orbán has pursued a strongly independent foreign policy, although he has been largely loyal to Brussels and the EU in terms of economic policy. What European leaders least like is Hungary’s good relations with Russia and with the Trump administration. Orbán has been under massive attack from Brussels. To make him more compliant the European Commission is blocking funds to which Hungary is actually entitled: a total of €22 billion in cohesion funding and a further €5.8 billion in funds from the Recovery and Resilience Facility. The Commission has made political reform a precondition for the release of funds. The European energy crisis that began with the onset of war in Ukraine has badly shaken the Hungarian economy. The European Commission’s decision to block funding due to rule of law concerns is now being questioned by the European Court of Justice (ECJ). It is suspected that the Commission has violated its own rules by withholding EU financial support.[1]

Conflict over Ukraine’s accession

The ongoing conflict with Hungary over Ukraine is currently escalating once again. The European Commission wants to accelerate Ukraine’s EU accession process and offer it partial EU membership long before the country has actually implemented the necessary reforms. Ukrainian President Volodymyr Zelensky is insisting that Ukraine should be allowed to join the EU as early as 2027 as part of a peace settlement with Russia. Orbán has described this move on X as an “open declaration of war against Hungary”.[2] Opposition to Ukraine’s EU membership has become a central element of his campaign ahead of the Hungarian parliamentary elections in April. Brussels and Kiev are hoping and pushing for a Fidesz defeat and a victory for popular opposition leader Péter Magyar and his TISZA (Respect and Freedom) party. A change of government in Budapest could open up political opportunities for Ukraine.[3] In light of the upcoming election German media are inflaming the debate, calling either for a radical political switch in Budapest or, should Orbán win the election and continue to block the EU Commission’s plans, for a “Huxit” initiative: Hungary’s withdrawal from the EU. Europe’s patience, they argue, has run out.[4]

A new Orbán?

But, contrary to what numerous reports suggest, TISZA leader Magyar, a former politician from Orbán’s right-wing Fidesz party, cannot be considered unambiguously pro-EU or pro-Ukrainian. TISZA voted against the EU’s 90 billion euro loan for Ukraine in the European Parliament. Magyar has also spoken out against plans for fast-track EU membership.[5] Hungarian observers often classify Magyar as a kind of “younger Orbán” who takes similar positions to the Prime Minister on issues such as refusing entry to migrants and refugees into the country. The difference is that he says he wants to restore Hungary’s position as a reliable EU member state, but without shying away from asserting Hungarian interests within the union. TISZA claims to be “recommitting” to Hungary’s alliances and rejects the idea that Hungary’s sovereignty needs to be strengthened vis-à-vis Brussels. Rather, it presents the EU as an instrument for asserting Hungarian interests. TISZA tells voters that restoring the rule of law is the route to “bringing home” suspended EU funds.[6]

A course correction for Europe

In addition to the war in Ukraine, another source of tensions between the EU and Hungary is Budapest’s alignment with the US critique of Europe. Under its latest National Security Strategy, the Trump administration has a more aggressive stance on the EU. On the one hand, Washington is saying, “We can’t afford to write Europe off.” On the other, it insists that it will “help Europe to correct its current trajectory” and align with Washington’s interests. This means giving active support for far-right forces in Europe (german-foreign-policy.com reported [7]). To this end, the State Department is encouraging political allies in Europe to rekindle the “individual character” of “European nations”.[8] One of these “political allies” is, of course, Orbán. Among other things, a strategic goal for the Trump administration is to “free” Europe from dependence on China.

The Heritage Foundation

The Washington Heritage Foundation began to move in a far-right direction years ago. It developed a close working relationship with Hungary under Orbán. The Heritage Foundation is known for having laid the foundations for the Trump administration’s second-term policies with its ‘Project 2025’ initiative. The foundation’s president, Kevin Roberts, welcomed Orbán for talks back in November 2022. He gave glowing praise to Hungary’s development under Orbán’s leadership. In 2023, the Heritage Foundation and the Danube Institute, a think tank close to Orbán, signed an agreement on closer cooperation. And the foundation now works with Patriots for Europe (PfE), a grouping of some far-right parties in the European Parliament, which includes the Hungarian Fidesz, the French Rassemblement National (RN), the Austrian FPÖ, the Belgian Vlaams Belang, the Italian Lega, the Spanish Vox, and the Portuguese Chega.[9]

Strategic concessions

The Trump administration is certainly making some concessions to Hungary in return for Orbán’s willingness to cooperate as a partner. Last year, for example, the White House announced that it was exempting Hungary from US sanctions on anyone purchasing Russian oil. But during his trip to Washington in early November 2025, Orbán had to pay a high price for this exemption. Orbán signed a memorandum on cooperation with the US in the civil nuclear industry and agreed to purchase ten small modular nuclear reactors worth 20 billion US dollars. Hungary has also agreed to purchase nuclear fuel worth 114 million dollars from US-based Westinghouse, along with contracts for US liquefied natural gas worth 600 million dollars and military equipment worth 700 million US dollars.[10] Hungary had originally cooperated closely with Russia on nuclear power production.

Orbán as a US ally

Trump, in turn, is backing Orbán in the Hungarian elections. “Viktor Orbán is a true friend, fighter, and WINNER, and has my Complete and Total Endorsement for Re-Election as Prime Minister of Hungary,” he declared on his Truth Social platform. Trump went on to write that relations between Budapest and Washington had reached “new heights of cooperation and spectacular achievement under the two leaders.” Orbán is billed as Washington’s candidate. He is seen as a key figure aligned to the National Security Strategy and the plan to “bolster patriotic European parties.”[11] Also in the context of the upcoming election, US Secretary of State Marco Rubio travelled to Budapest in mid-February and proclaimed a “golden age” of bilateral relations. In a joint press conference with Orbán, Rubio praised their “partnership”, saying “Your success is our success”. He added candidly that it was in the national interest of the US for Orbán to win.[12]

US financial aid

US support for Fidesz’s election campaign includes the promise of financial aid. This is similar to the playbook used by Washington in Argentina. Hungary is under considerable fiscal pressure due to the withheld EU billions. After Orbán’s visit to Washington, he was able to announce that the US was ready to provide Budapest with a cash injection that might render certain Brussels instruments against Hungary ineffective. Orbán declared that Brussels’ idea of being able to “strangle” the Hungarian economy financially was now a thing of the past. The problem had been “solved with the Americans” and a “financial shield” they would provide. One option is a currency swap between the central banks of Hungary and the US – similar to the 20 billion dollar exchange rate stabilisation agreement with the US that Argentina signed last year shortly before a key election that helped Javier Milei achieve his breakthrough as president. This deal amounts in essence to a rescue package for Hungary. A swap agreement could secure the country’s access to US dollars. And this would enable the Hungarian central bank to stabilise the exchange rate, a move that would lower import prices in the country.[13]

Up to 20 billion dollars

Orbán has concluded another deal in Washington. A consortium of US banks is to grant loans to the Hungarian state. If the plan is implemented, Citigroup would lead the lenders’ consortium. Its CEO, Jane Fraser, travelled to Hungary in mid-October and met with Central Bank Governor Mihály Varga, Prime Minister Orbán and Foreign and Trade Minister Péter Szijjártó. In a television interview last year Orbán stated that the government could receive, in total, up to 20 billion US dollars through the two financial instruments.[14]

[1] Max Griera, Gabriel Gavin: ‘Absurd!’ Orbán slams idea of returning EU’s €10B. politico.eu 12.02.2026.

[2] Sebastian Starcevic:  Orbán slams EU membership plan for Ukraine as ‘declaration of war’. politico.eu 11.02.2026.

[3] Zoya Sheftalovich: Ukraine eyes gap between Hungarian and French elections to secure EU membership. politico.eu 25.02.2026.

[4] Jens Münchrath: Warum es Zeit ist, Ungarn den EU-Austritt nahezulegen. handelsblatt.com 16.02.2026.

[5] Max Griera, Ziya Sheftalovich, Nicholas Vinocut: Orbán’s gambit to revive his election hopes: A battle against the EU. politico.eu 25.02.2026.

[6] Zsuzsanna Végh: Tisza’s foreign policy offer: Plans for a post-Orban Hungary. ecfr.eu 11.02.2026.

[7] See: The Hooligan in the State Department.

[8] See: Der neue Transatlantikpakt.

[9] See: „Vom Trump-Tornado lernen“.

[10] Ben Johansen, Diana Nerozzi:  Trump exempts Hungary from Russian oil sanctions for 1 year. politico.eu 11.07.2025.

[11] Ketrin Jochecová: Trump backs Orbán ahead of key Hungary election. politico.eu 06.02.2026.

[12] Milena Wälda: ‘Golden age’: Rubio praises Orbán ahead of Hungary election. politico.eu 16.02.2026.

[13] Seb Starcevic, Michael Stratford: Orbán counts on Trump going full Argentina to save him from election doom. politico.eu 10.11.2025.

[14] Tamas Wiedemann: A választások előtt erős forintárfolyamban érdekelt a kormány. szabadeuropa.hu 20.11.2025.