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United States
October 14, 2024 4:00 AM CET Hungarian Prime Minister Viktor Orbán has concocted a way to let Trump, if he successfully makes it to the White House for a second term come November, wriggle out of a $50 billion loan the U.S., the European Union and leaders of the G7 offered to Ukraine to back its fight against Russia. Hungary says it won’t consent to a change in rules that would allow Washington to play a major role in the loan until after the U.S. election. That would let Trump off the hook, allowing him to tell Republican voters that, if elected, he won’t give Ukraine another cent. Washington insists that the EU needs to extend the sanctions renewal timeframe to at least 36 months. Under current rules, the EU’s sanctions come up for renewal every six months. While every other leader is in favor of extending the sanctions rollover period to 36 months as 'requested' by the U.S., Orbán refuses. According to the EU’s own rules, all 27 member countries need to approve any changes to the sanctions rules. It’s about helping Trump,” said an EU diplomat. If Brussels and Washington jointly underwrite the €35 billion loan, a reelected Trump would be tied to servicing it for years. But if the loan is approved without the U.S., he would have no such obligation. Now, the U.S. is unlikely to participate substantially. Still, Europe is likely to go ahead anyway. As Orbán threatens to use his veto in Brussels, the U.S. signaled that it is considering participating in the loan - albeit with a significantly lower amount - even if the EU cannot prolong its sanctions period, another EU diplomat and a European Commission official said. One of the options involves Washington contributing $5 billion, which roughly equals the amount of Russian assets that it holds domestically. The Commission official believes that the U.S. does not want to arrive empty-handed at a meeting of G7 finance ministers in Washington at the end of October that will likely decide the fine print of the $50 billion loan. Japan recently signaled that it might pull out of the loan if the U.S. does not take part. If Hungary refuses to budge on the sanctions duration, the EU is likely to finalize the loan on its own terms because its budget rules make it much easier to get the payment approved by national capitals before year-end. The EU is fast-tracking legislation to pay up to €35 billion to Ukraine, which covers the U.S. share of the loan and is set to be finalized by the end of October. But penny-pinching governments in the EU are reluctant to increase their contribution to cover the shortfall from the U.S. (Source: politico)
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