This Is How Much Hungarians Would Pay if Ukraine Joined the EU

The Hungarian Institute of International Affairs calculates that the share of Hungary’s contribution to Ukraine’s accession and reconstruction over the next five years would be €48.1 billion, or 68% of the country’s 2023 budget, reports Tényellenőr.

Ukraine’s EU membership has been a long-standing idea for decades – the country first formally announced its intention to join in 1998. Later, in 2008, then President Viktor Yushchenko confirmed the earlier declaration. Events accelerated in 2022, when the country formally applied for membership after the start of the Russian invasion. This was followed by candidate status from the European Council in June, and an offer from the Commission to open accession negotiations in November 2023.

Péter Siklósi, Senior Fellow at the Hungarian Institute of International Affairs, said the biggest difficulty was that

Ukraine is a huge country – its accession would completely upset the way the EU currently operates and upset the current balance of power.

“Take financial resources, for example. At the moment, a large part of the EU budget is made up of money for the common agricultural policy and the various structural funds that are used to bring the less developed regions up to the level of the more developed ones. Since Ukraine is a country with a large agricultural sector but is much poorer than the European average, the current Member States would receive significantly less money from both agricultural and regional development funds if it joined. Not only because of the size of the country, but also because of the underdevelopment of the regions,” he explained, stressing that this would create counter-interests.

The country currently lacks strict quality control, pesticides are used in crop production that have long been banned in the EU, and yield enhancers and antibiotics used in livestock production also put EU farmers at a serious competitive disadvantage.

In addition, a significant proportion of Ukrainian products are GMO-based, which would create further tensions.

Moreover, there are more than 500,000 hectares of land in Ukraine with mines buried in the soil, and it would cost a huge amount of money to clear these areas. With the country’s accession, the costs of post-war reconstruction would be borne primarily by EU farmers.

Ukraine’s accession does not only entail huge risks for agriculture and not only because of the huge areas and population – the economic situation of Hungary’s northeastern neighbor is in a dire state. According to IMF figures from April 2024, Ukraine was below the level of Albania and Serbia or North Macedonia in terms of nominal GDP per capita.

According to Tamás Hegedűs, senior macroeconomic analyst at Századvég Foundation, Ukraine’s accession to the EU could have a significant and lasting impact on the Hungarian pension system and Hungarian pensions as well.

Decree-Law No 16 of 1963, on cooperation between the Hungarian People’s Republic and the Soviet Union in the field of social security is still in force. It stipulates that if a pensioner moves from one of the two countries to the other, the competent body of the host country shall, at the earliest from that time, determine the pension in accordance with the legislation of its own state, including the age limit, and pay it at its own expense. The number of beneficiaries concerned is not yet significant. However, eventual EU membership would facilitate legal resettlement, which could speed up the process. According to Századvég’s calculations, if only one percent of Ukrainian pensioners decide to take advantage of this option, the annual additional expenditure of the pension system could reach HUF 200 billion (EUR 501 million) per year.

Another problem is corruption. Even according to Transparency International’s 2024 compilation, Ukraine would be the most corrupt in the EU in terms of corruption perceptions, with a score of 35, ranking it on par with Serbia.

According to calculations by the Hungarian Institute of International Affairs, Ukraine’s planned accession to the EU would cost roughly €2.5 billion over the next five years, which would mean an expenditure of HUF 2 million (EUR 5,000) per person in Hungary. Ukraine’s accession, rearmament, and reconstruction would require €48.1 billion from Hungary over the next five years, 68% of Hungary’s 2023 budget.

Via Tényellenőr, Featured photo via Pixabay