Hungarian government started negotiations on relaunching Norwegian Funds – Szabad Európa reports

An agreement has been reached with Hungary's participation between the European Commission and the countries of the Norwegian Financial Mechanism (also known as the Norwegian Funds) on the use of the Mechanism's resources, Szabad Európa has learned.

According to the paper’s information, the countries of the Norwegian Funds (Norway, Liechtenstein, Iceland) recently held talks with the European Commission in Brussels in the context of the Hungarian EU Presidency. The two sides, represented by Péter Sztáray, State Secretary of the Hungarian Ministry of Foreign Affairs and Trade, and Norwegian Foreign Minister Espen Barth Eide, reached an agreement on the resumption of the Norwegian Financial Mechanism's operations in Hungary. According to the newspaper, bilateral negotiations with Norway on the resumption of the Fund's operations, which were suspended in 2021, may start before the end of this year.

Along with Liechtenstein and Iceland, Norway is a member of the European Economic Area but not of the European Union. This means that while it enjoys the benefits of the single economic area, it does not have to contribute to the EU's spending. To compensate for this, the three countries set up a system of financial funds to assist the member states that joined the EU after 2004.

The Orbán government first tried to assert control over the Norwegian Fund's grants awarded to Hungarian NGOs in 2014, when, in addition to campaigning against the "Soros-friendly NGO" beneficiaries, they took official action, carrying out property searches and even having the Governmental Accountability Office and the National Tax Authority investigate them. In the end, they found everything in order, but due to the conflict, Hungary was the only one of the 15 beneficiary countries in the 2014-21 cycle that did not withdraw funds – most of which are channelled by Norway through ministries.

In 2020, it seemed that an agreement might be reached between the Norwegian and Hungarian governments, but in July 2021, after failing to jointly select the NGO which would distribute the HUF 4 billion allocated from the Funds, the Hungarian state opted to also give up the HUF 77 billion that could have been distributed by the various ministries. However, the Norwegian Foreign Minister at the time made it clear that if not from the fund, they would find other ways to support Hungarian NGOs.

The current agreement could be a first step towards allowing the member states in question to restart negotiations with the countries of the Norwegian Fund. Szabad Európa has learned from Norwegian sources that Poland is already in talks with the Fund's member states, with negotiations expected to be completed by spring 2025. This would allow Poland access to roughly €740 million – its share for the 2014-21 cycle.

The money for the Hungarian NGOs was supposed to be distributed by a consortium led by Ökotárs Alapítvány, but the government also lashed out at the foundation back in 2014. When asked about the relaunch of the Norwegian Fund, Veronika Móra, the head of Ökotárs told Szabad Európa that she was unable to comment on the news of the Hungarian-Norwegian negotiations and added that the foundation had not yet decided whether they would apply for the NGO funds again.

We sent questions to the Ministry of Foreign Affairs and Trade and the Government Information Centre about the rebooting of the Norwegian Fund, and will inform our readers as soon as they respond.