The row within the European Union, where Hungary and Poland blocked approval of the next seven-year budget and post-pandemic recovery package, led to claims that the EU is “broken” or that the post-socialist countries that joined from 2004 were let in too soon. The reality is more nuanced than that, but the crisis should highlight some of the specific challenges of the EU’s newer members. 

The dispute erupted over plans to tie the funds allocated in the package, amounting to an unprecedented €1.8 trillion to help countries recover from the ravages of the pandemic, to the rule of law – an area where the two countries have repeatedly clashed with Brussels. Both exercised their vetoes to block the passage of the budget leading to a lengthy deadlock that is now close to resolution as a Polish official revealed on December 9 that the pair have provisionally accepted a proposal from the EU's German presidency. 

An existential threat? 

The spat has raised the question of whether there is an east-west divide in the EU and, if so, whether it poses a threat to the union’s existence. 

While it is the two leading Central European “illiberal democracies” that blocked the financial package, and were previously the subject of the EU’s Article 7 procedure over rule of law issues, this in itself isn’t confirmation of an east-west divide. They have backing from Slovenian Prime Minister Janez Jansa, a close ally of Hungarian Prime Minister Viktor Orban’s, but other top politicians from the region have urged Orban and Polish Prime Minister Mateusz Morawiecki to back down and allow the much-needed funding to go ahead. 

Indeed, for the most part the EU members in Central and Southeast Europe are poorer than their western counterparts and set to be the biggest beneficiaries of the new package relative to their GDPs, so they are loath to lose out. 

The question of an East-West divide within the EU was discussed at an online panel hosted by NGO Maastricht Working on Europe on December 1, with some panellists disputing the relevance of such a divide. Renate Nikolay, head of cabinet of European Commissioner for Justice, Consumers and Gender Equality Vera Jourova, argued that there is no single divide across the EU, but multiple cleavages on different issues. 

“The truth is we are struggling, debating, coming from very different positions on many aspects of the European integration project and these dividing lines don’t always go through East to West,” said Nikolay. 

She noted the “clear divide” between north and south on macroeconomic performance and the division between the “frugals” and other EU members on budgetary issues, while saying that EU members are broadly aligned on trade and moving in the same direction on environmental policy. 

Other panellists argued that the east-west divide is a special case, as there are multiple dividing lines between the east and west, and some of these go deep. 

Rachel Epstein, professor of international relations and European politics at the Josef Korbel School of International Studies, believes there is a clear divide in the EU: “Even if I agree ideologically speaking there are not huge differences on trade, investment or the advantages of the single market … there are still frustrating differences between the economic statuses of countries that joined since 2004 and those of older members.” Specifically, she pointed to the “obvious and ongoing” difference in standards of living. 

“For all the economic advantages of EU accession … countries that were trapped behind the Iron Curtain are starting from a very different place. Although EU integration has been good for mitigating some disparities, it has not erased them.” 

Professor Dorothee Bohle of the European University Institute’s Department of Political and Social Sciences listed numerous manifestations of the east-west divide: the political divide over democratic backsliding, rule of law, gender, LGBT rights and migration; the economic divide between the core and periphery; the social divide as Eastern Europe is considered more socially conservative, while the west is more liberal; and, the huge demographic divide as East European countries have some of the fastest-shrinking populations in the world. 

However, she also raised the issue of the framing of such divides, and the tendency of each side to push the problems onto the other. Thus Hungary's Orban presents disagreements as western imperialism versus victimised Eastern Europe, while western politicians see it as the “good" West versus the “bad” East. In much the same way, previous disputes over economic issues have been framed as a clash between southern “sinners” versus northern “frugals”. 

Hungarian MEP Katalin Cseh of the centrist Renew Europe Group stressed during the same panel that the two sides of the EU had “very, very different starting points. Part of the EU was under a repressive regime for decades. I remember stories of my grandparents listing to RFE in their basements and longing to belong to the EU. During this time people in other EU members lived in prosperity, their markets were free, human rights flourished … Institutions in my countries and countries around are so much younger and more fragile compared to democracies that have been functioning for hundreds of years now.” 

However, she also said that from a similar starting point the progress of Central European states has diverged. “We have bad governance [in Hungary], but Slovakia was a loud voice demanding the rule of law conditionality mechanism. Estonia, a small country with a difficult legacy, is now a frontrunner in the tech sector. They made good use of the opportunities the EU gave to them."

Too much too soon

The question of whether eastern EU members were let in too soon has long been a topic of discussion with respect to Bulgaria and Romania, the two poorest EU states, both of which have been subject to Cooperation and Verification Mechanism (CVM) monitoring to assess their progress on fighting corruption and, in Bulgaria’s case, organised crime. 

Cseh considers that the “EU wasn’t prepared enough for enlargement and the results of this can only be seen now”. She pointed out that every country that entered the EU had to comply with the Copenhagen criteria at the time of accession. “The question is how to keep countries complying after accession; Hungary, for example, would not be able to join if it applied now. Democratic backsliding was not something the EU accounted for when it opened its doors for us,” she said. 

According to Nikolay, “at the moment, there is a real debate in Europe about the foundations and values we are building the European project on.” While all member states accepted Article 2 of the Treaty [on European Union] that includes discrimination and the rule of law, in certain member states we have a backtracking movement, which is a serious concern we have to deal with. The solution in the future is not to have a multi-speed Europe.”

This lesson has been learnt and the countries from the Western Balkans that hope to be part of the next wave of accession are feeling the impact. Their progress towards accession has been slow and the likely next entrant, Montenegro, is not expected to join the bloc before 2025 at the earliest, more than a decade after Croatia became the latest country to join in 2013. 

Cseh argued that the EU put too much trust in member states and supervision was too lax, allowing EU funds to be channelled towards local oligarchs and media owners in certain countries rather than for the benefit of their population. 

The European Anti-fraud Office, Olaf, revealed in its latest annual report that there was a high intensity of investigations in eastern members into the use of EU funds that concluded in 2019. Of the six countries with the largest numbers of investigations concluded during the year, four were from the east of the bloc. It was a similar picture the previous year. 

Meanwhile, according to anti-corruption watchdog Transparency International, most post-communist EU member states are struggling to address corruption effectively. Its latest Corruption Perceptions Index (CPI) published in January shows that with some exceptions, the newer EU member states in the eastern part of the bloc perform less well than their peers to the west. Bulgaria remained the most corrupt country in the EU, followed by Romania and Hungary. 

Last gasp of the populists 

The outspokenly illiberal stance of the Hungarian and Polish governments is to some extent mirrored in the social attitudes of other states from the region. For example, attitudes in the region tend to be more conservative than those in the West on issues such as LGBTQ rights and gender equality. In several countries there is a gradual movement to a more liberal mood, trailing developments in the West a decade or two earlier. However, in others the movement is in the opposite direction, as reflected in the Hungarian government’s use of its emergency lockdown powers to ban legal gender recognition for transgender people and block adoption by same-sex couples.

The shift to right-wing populism is by no means limited to Central Europe. Far-right and right-wing populist parties have been resurgent around the world, a process accelerated by the previous international economic crisis that started in 2008. Developments such as the UK’s Brexit referendum and the election of Donald Trump as US president no doubt emboldened politicians in Budapest and Warsaw in their resistance to western liberal values. 

Orban in particular has used combative language, talking of western cultural imperialism and efforts to force liberal values onto Hungary. He sought to defend his use of the veto to Hungarian voters by linking the EU budget and recovery package to migration. 

Epstein argued that western countries have been equally at fault when it comes to the rule of law, but have come under less scrutiny from EU institutions than Hungary or Poland. “Brexit was not framed as a violation of the rule of law, but the decision was predicated on mass misinformation,” she said, highlighting the racist tropes used to try to mobilise the vote to leave. “The policy toolkit with respect to immigration is not just East European; we see it across the board. This set of attitudes was mobilised and elevated in US, Brazil and India, far beyond the European sphere. The salience of identity politics seems to have a renewed power and has become a source of mobilising political action.”

However, with the pandemic, the world has changed this year. Trump failed to win re-election and his single, ignominious term will end in January. Having also handled the pandemic chaotically, UK Prime Minister Boris Johnson is facing revolts within his own party and a slump in poll ratings even before the looming blow of the full Brexit impact. 

In Poland, President Andrzej Duda narrowly won re-election in June, but the ruling Law and Justice (PiS) party over-reached itself when the country’s top court, widely considered to be influenced by the ruling party, introduced new restrictions that almost completely ban abortion in the country. This sparked mass protests – apparently not anticipated by the government, who appeared to think angry Poles would stay at home to avoid infection. 

Hungary’s ruling Fidesz Party has now been shaken by a scandal concerning prominent MEP Jozsef Szajer, who was caught by police escaping down a drainpipe from an illegal all-male sex party in Brussels. This sparked calls of hypocrisy from a government that has done all it can to make life difficult for LGBTQ people. With Szajer’s resignation, Orban also loses a key moderate ally who might have helped smooth the path to a compromise over the EU budget. 

The victimised East 

Alongside the loud claims of cultural imperialism and forced acceptance of migrants coming from Hungary, there are some quite legitimate grievances on the part of the newer EU members. 

One notorious example was the revelation that multinational companies were selling lower quality products in identical packaging for the same or even higher prices in eastern EU members. 

A much weightier problem is the mass emigration from the new member states to higher-income western members. Demographics are one of the biggest challenges facing countries in the region that are forecast to experience the world’s fastest population decline this century. 

Bohe talked of large-scale migration having “robbed Eastern Europe of its younger, educated, liberal, more dynamic population”, resulting in a backlash against in this part of the EU. “The terms of integration unleashed forces of fragmentation, creating the opportunity to externalise responsibility, blame others and create the narrative of the East-West divide,” she said. 

Epstein also commented on the political implications of migration, giving the example of East European states of training medical professionals who then emigrate west, leading to a “sense of disparity and possibly even exploitation”. 

Brussels has been adamant that it will stand firm on tying the rule of law to the funding package to keep all member states to the same high standards in this area. The large amounts of cohesion funding directed at the Central and Southeast European member states are helping their economies catch up with the older western member states. What is still outstanding – and needs to be addressed more seriously if the East-West divide is not to widen in future – is the demographic divide.