Brussels Edition: EU’s Hungary problem

EU foreign ministers are visiting Kyiv, but Hungary's opposition to Ukraine is an increasing problem ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Read in browser

Welcome to the Brussels Edition. I'm Suzanne Lynch, Bloomberg's Brussels bureau chief, bringing you the latest from the EU each weekday. Make sure you're signed up. The European Union's top foreign policy official, Kaja Kallas, is leading a delegation of foreign ministers to Ukraine today to mark the fourth anniversary of the massacre of Ukrainian civilians by Russian forces in the Kyiv suburb of Bucha. The visit is the latest show of solidarity with war-battered Ukraine. But it's becoming increasingly difficult for Brussels to brush off its Hungary-shaped problem in offering such backing. A new report by a consortium of investigative journalists shows that Hungary's government allegedly intervened on behalf of Moscow to have the sister of a Russian oligarch removed from the EU's sanctions list. According to an audio recording published today by The Insider and VSquare outlets, Russian Foreign Minister Sergei Lavrov reminded his Hungarian counterpart, Peter Szijjarto, of a promise to have Gulbakhor Ismailova, the sister of Russian billionaire Alisher Usmanov, struck from a sanctions list. Ismailova was removed seven months later. Hungary has of course consistently slowed efforts to help Ukraine, with Hungarian leader Viktor Orban making no secret of his ties with Russian President Vladmir Putin. Responding to the publication of the recording, Szijjarto was defiant. "For four years we have been saying that sanctions are a failure, causing more harm to the EU than to Russia," he said. The Hungarian regularly consults with non-EU foreign ministers, he added. Peter Szijjarto, Hungary's foreign minister, during a Bloomberg Television interview in London, last year. Photographer: Jose Sarmento Matos/Bloomberg The European Commission appeared relatively nonplussed by the revelation today, noting only that Kallas had spoken to Szijjarto earlier this week and had reiterated the importance of confidentiality noting that deliberations at foreign affairs councils "should not be disclosed to third parties." There is mounting concern in Brussels about Hungary's leaking of confidential information to third parties, a reality that captures how far Orban's government has strayed from the EU consensus. With Hungary continuing to block a €90 billion loan to Ukraine and the 20th sanctions package, the policy in Brussels seems for now to be to ride out the storm until a crucial election on April 12 potentially ousts Orban from power. The Latest ECB Governing Council member Fabio Panetta said that officials mustn't let war-driven inflation stoke wages, while cautioning against too strong a response. Secretary of State Marco Rubio said the US may need to reassess its relationship with NATO after the Iran war is finished, calling the military alliance's alleged lack of support during the Middle East conflict "very disappointing." Germany warned the EU's rules to curb methane emissions from oil and gas imports risk impeding crucial LNG purchases just as the country seeks to diversify suppliers and cushion the Iran war's impact on energy prices. Italy's government is nearing decisions on who will lead major state-backed companies worth about €250 billion ($287 billion), with shakeups expected at some of the firms.  President Donald Trump told allies struggling to get jet fuel blocked from traveling through in the Strait of Hormuz to just "take it," arguing the US had already weakened Iran enough. Seen and Heard on Bloomberg EU competition rules must ensure an open, competitive market in the digital sector, the bloc's anti-trust chief, Teresa Ribera, said. "We need new entrants with good ideas to have a chance to compete with the big guys," she told Bloomberg TV in an interview following meetings with tech leaders in the US, including Meta's Mark Zuckerberg and OpenAI's Sam Altman. "I have this sense that the average American citizen may share the same kinds of concerns as the average European citizen" when it comes to social media, she added, noting last week's judgments in Los Angeles and New Mexico. Chart of the Day The euro area reported its steepest jump in inflation since 2022 today as the Iran war pushed energy costs sharply higher, backing expectations that the ECB will have to raise interest rates. Consumer prices rose 2.5% from a year ago in March – up from 1.9% the previous month and the highest since January 2025. The reading is just below the 2.6% median estimate in a Bloomberg survey. Coming up EU foreign affairs chief Kaja Kallas and Ukrainian Foreign Minister Andrii Sybiha press conference in Kyiv Press conference after EU energy ministers meeting this evening ECB's Olli Rehn, Foreign Minister Elina Valtonen in debate on TV this evening Final Thought European rates markets are set for the most volatile month on record, sparking chatter over the role robot traders are playing in exacerbating wild swings during the Middle East conflict. Euro two-year interest-rate swaps — used to bet on the outlook for central bank policy — have seen historic volatility in March, while for UK contracts it's been the choppiest month since the selloff that led to the ousting of former Prime Minister Liz Truss in 2022. The speed and scale of the moves has some fund managers pointing to the greater role now being played by artificial intelligence and algorithmic trading. Like the Brussels Edition? Don't keep it to yourself. Colleagues and friends can sign up here. How are we doing? We want to hear what you think about this newsletter. Let our Brussels bureau chief know. We're improving your newsletter experience and we'd love your feedback. If something looks off, help us fine-tune your experience by reporting it here. Follow us You received this message because you are subscribed to Bloomberg's Brussels Edition newsletter. If a friend forwarded you this message, sign up here to get it in your inbox. Unsubscribe Bloomberg.com Contact Us Bloomberg L.P. 731 Lexington Avenue New York, NY 10022 |