Calling it quits: How Europe should build on Fidesz’s exit from the EPP

“The dictator is coming” murmured then European Commission president Jean-Claude Juncker at an EU summit in 2015, shortly before greeting Hungary’s prime minister, Viktor Orbán, with a slap in the face. The encounter perfectly encapsulated the long-standing relationship between Hungary and the European Union, which has never really punished Orbán for his democratic backsliding in the past decade.

But that could now change. Orbán’s Fidesz declared on 3 March that it would leave the European People’s Party (EPP), after 80 per cent of the parliamentary group’s members voted in support of new rules that paved the way for it to be suspended or excluded. In an angry letter to EPP leader Manfred Weber, he explained that he no choice but to declare the withdrawal of all 12 Fidesz MEPs.

One thing is clear: the EPP should have shown Orbán and his party the door much earlier. Its suspension of Fidesz’s membership two years ago was half-hearted, at best. For too long, the EPP looked the other way and tolerated Orbán’s anti-democratic and right-wing policies, as well as his populist attacks on Brussels institutions and their representatives.

Since taking office around ten years ago, the Fidesz government has steadily eroded the rule of law in Hungary. It has restricted the freedom of the media, introduced legal measures to obstruct the work of NGOs critical of the government, started a war against academic freedom in the country, and implemented a xenophobic policy on migrants and refugees. As a result, Hungary is subject to several pending EU infringement proceedings and rule of law procedures.

Orbán keeps his party in power by looking for an external enemy, a scapegoat in Brussels. In the process, his party colleagues in the EPP have repeatedly come under fire. Two years ago, tensions between Fidesz and the EPP escalated when Orbán targeted Juncker, a member of the group, with a large-scale, publicly funded poster campaign in Hungary based on conspiracy theories. Most recently, Hungarian EPP member Tamás Deutsch was removed from his position in the group after he accused Weber of using ‘Gestapo’ methods in the debate on the rule of law.

In view of its anti-democratic tendencies and personal attacks on EU leaders, Fidesz is in a particularly delicate situation given that Hungary’s economic upswing of recent years is mainly based on payments from Brussels. Transparency International estimates that half of all public procurement and as much as 90 per cent of major infrastructure projects in Hungary are financed by the EU. However, amid this enormous influx of EU funds, loyal entrepreneurs in Orbán’s entourage and his family members have become extremely rich. According to the EU anti-fraud office OLAF, 4 per cent of EU funding to Hungary has been misappropriated since 2015 – a peak in the misuse of such funds.

These trends showed the EU that it required a new set of funding rules. But Hungary and Poland blocked the EU’s seven-year budget and €1.8 trillion recovery fund late last year, in protest at the rule of law mechanism other member states had attempted to attach to the measures. This blackmail has been at least partially successful, as the EU eventually agreed to weaken the mechanism.

Seen in this light, Fidesz’s departure from the EPP marks a turning point in relations between the EU and Hungary. For years, the EPP’s hesitant approach to the Hungarian ruling party symbolised EU institutions’ inability and unwillingness to seriously address growing authoritarianism in Hungary. Now, the line between the political forces committed to the rule of law and those with a different concept of European values is becoming more visible.

The fact that Fidesz survived in the EPP for so long is mainly down to German conservatives from the Christian Democratic Union (CDU) and the Christian Social Union (CSU), who protected Orbán for the sake of Germany’s economic interests. He could always assume that large German companies with operations in Hungary – such as Audi, Bosch, or Daimler – would ensure that Germany’s governing parties maintained a good relationship with Fidesz. And he could rely on German Chancellor Angela Merkel to praise the good economic relationship between the two countries.

Yet Orbán has become lonelier in Europe. Markus Söder, a member of the CSU who could become the next chancellor, demanded that Fidesz finally leave the EPP. So far, he had reacted rather cautiously to Fidesz’s withdrawal from the group – as has Armin Laschet, the CDU’s leader and another potential candidate for chancellor. Orbán will miss his allies, especially when the members of the EPP organise voting majorities and otherwise coordinate with one another in the lead-up to European Council summits. It is likely that the Fidesz parliamentary group will now look for a new political home. It may choose the European Conservatives and Reformers Group, which includes Poland’s ruling Law and Justice party. It is also possible that Fidesz will join the even more right-wing Identity and Democracy parliamentary group, which is home to the radical, right-wing Alternative for Germany. No matter what Fidesz decides, both factions fit the nature of the party much better than the EPP.

After a decade of democratic backsliding, this new political reality provides the EU with a chance to take a tougher stance on Budapest. Since Hungary desperately needs funding from Brussels, the EU should use this leverage to finally counter the country’s increasing authoritarianism in an appropriate way. The EU recently took legal action to call on Budapest to implement the European Court of Justice ruling on a Hungarian law on foreign-funded NGOs. And the court will also decide whether the rule of law conditionality attached to the EU’s budget and recovery fund is compatible with EU law, after Hungary and Poland filed a complaint over the mechanism last week.

This time next year, Hungarian voters will be able to speed up change at the ballot box. The latest Eurobarometer survey shows that around half of them have a positive view of the EU. Despite all his nationalist rhetoric, “the dictator” has at least failed to change this attitude among the Hungarian public.