EU budget battle erupts as four countries defy Merz over Ukraine aid

Key Points:

• Leaders of Slovakia, the Czech Republic, Hungary, and Bulgaria have rejected German Chancellor Friedrich Merz's ultimatum to link approval of the EU's next long-term budget to new financial aid for Ukraine, with Slovak PM Robert Fico calling it "blackmail" and threatening to use his veto.
• Czech PM Andrej Babiš highlighted that the current EU budget already allocates €100 billion for Ukraine, but those funds will only be available from 2028, while Ukraine faces a €70 billion shortfall next year.
• Merz insists that fresh aid for Ukraine is an "essential prerequisite" for approving the EU budget and argues that burden-sharing for Ukraine's support must be fair, while Hungary and Bulgaria cite high domestic deficits as reasons to resist new joint debt commitments.
• The disagreement reflects a broader split between the "Friends of Cohesion" group, including Slovakia, Czechia, Hungary, and Bulgaria, who want to protect cohesion and agricultural funds, and the "frugals," including Germany, who push for budget cuts and more equitable Ukraine support.
• Despite tensions, all parties express willingness to negotiate, with Hungarian PM Péter Magyar and Bulgarian PM Rumen Radev emphasizing the need for solutions while maintaining their countries' support for Ukraine through other means.