Norway Resumes Funding for Hungary, Granting €254 Million for Reforms

Norway is resuming financial assistance to Hungary that was suspended more than a decade ago. On Monday in Budapest, Norwegian Foreign Minister Espen Barth Eide and Hungarian Finance Minister András Kármán signed an agreement providing Hungary with €254.1 million in support. The funds are intended to promote democratic reforms carried out by the government of Prime Minister Péter Magyar.

Why the aid was halted

Norway stopped funding Hungary in 2014, when Viktor Orbán headed the government. Oslo justified the move by saying that agreements on the management of funds had been violated.

What the money is for

The cooperation will focus mainly on strengthening democratic institutions, promoting the rule of law and good governance, and ensuring media freedom and the integrity of information. Eide said the agreement opens a new chapter in relations between the two countries and that the funding will benefit Hungary's people by supporting the Magyar government's reforms to restore democracy.

The European Economic Area mechanism

Norway is not a European Union member, but it takes part in the European Economic Area (EEA). Together with Iceland and Liechtenstein, it contributes to financial mechanisms aimed at reducing economic and social disparities across Europe. Oslo provides about 97% of the EEA funds that could be paid out to Budapest by April 2031.

The European Commission's decision

After Magyar's victory in the parliamentary election in April, the European Commission proposed in September to release €4.2 billion to Hungary. That money had been frozen in connection with procedures launched against Hungary over Orbán's policies, particularly concerning the rights of LGBT+ people and asylum seekers, as well as conflicts of interest.