FirstFT: EU budget row threatens €50bn Ukraine fund

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EU leaders risk leaving Ukraine empty-handed at a perilous moment in its war against Russia as divisions over finances threaten a €50bn lifeline for Kyiv and Hungary vows to thwart its EU membership talks.

Disputes within the EU over money and Ukraine’s future are endangering crucial pledges to Kyiv made months ago — just when the Biden administration’s proposed $60bn package for Kyiv has abruptly stalled in a politically divided Congress.

EU member states are far from reaching a deal over topping up the bloc’s joint budget — including €50bn for Ukraine — ahead of a summit in Brussels on December 14-15, said officials involved in the discussions.

Efforts to reach a compromise are being hampered by the victory of a far-right party in last month’s Dutch election and a recent German court ruling curbing the government’s borrowing. Hungarian Prime Minister Viktor Orbán has also vowed to veto the start of Ukraine’s EU membership talks.

Read the full report on the EU funding row.

Here’s what else I’m keeping tabs on today:

• FT Business Book of the Year: The Financial Times and Schroders announce the book judged to have the most compelling and enjoyable insight into modern business issues in 2023. See the shortlist here.

• Good Friday Agreement: Westminster’s Northern Ireland affairs committee publishes its report on the effectiveness of institutions created by the 1998 pact.

• Economic data: The US reports monthly factory orders.

Five more top stories

1. Britain’s armed forces face their largest budget black hole for more than a decade, according to a damning report by parliament’s spending watchdog that said the government’s equipment plan was “unaffordable”. At the end of March this year, estimated costs were £305.5bn compared with a budget of £288.6bn. Read more about the causes of the £16.9bn deficit.

2. Poland’s central bank is seeking support from the EU to defend its governor. Donald Tusk, the incoming prime minister, has repeatedly demanded the removal of National Bank of Poland president Adam Glapiński, a longstanding friend of Jarosław Kaczyński, whose ruling Law and Justice party lost the election this year. Tusk accuses Glapiński of acting in his party’s interests while the NBP says ousting the governor would undermine the independence of monetary policymakers.

3. Hamas’s network of tunnels, thought to be larger than the London Underground, could define the outcome of Israel’s campaign in Gaza. With air-conditioning units, functioning toilets and kitchens with running water as well as electrical and communication cables and a blast-proof door, the tunnel under Gaza’s al-Shifa hospital, which Israel’s military infiltrated last month, was a substantial military capability. But Israel says it was only a small part of Hamas’s vast subterranean domain.

4. Europe is still vulnerable to gas supply shocks despite significant progress in cutting reliance on Russia, the head of one of Germany’s largest energy companies has warned. Despite entering winter with stocks about 99 per cent full, Europe needs to boost its capacity to import gas to make sure it can cope with any unexpected outages on pipelines or import terminals, RWE chief executive Markus Krebber told the FT.

5. Exclusive: UBS has sold the Credit Suisse corporate jet used by former chair António Horta-Osório. The Dassault Falcon 7X was used to fly Horta-Osório into London to watch the Wimbledon tennis finals and football’s European Championships final on the same day in July 2021, in breach of Covid-19 lockdown rules. The plane has been sold to a German subsidiary of French bank Société Générale.

The Big Read

Three years after BlackRock chief Larry Fink put the world’s largest money manager squarely behind the cause of purpose-driven investing, a backlash has seen US Republicans relentlessly pound big banks and investment managers for being “too woke” or “hostile” to fossil fuel. While BlackRock is still betting big on the transition to a lower-carbon economy, such as a $550mn carbon capture project in Texas, Fink is emphasising the moneymaking potential rather than the contribution to the planet’s welfare.

We’re also reading . . . 

• Friederike Otto: The Imperial College London physicist whose group has helped link specific natural disasters to global warming is convinced that it is only a matter of time before a big carbon producer is found liable in court, she tells Henry Mance.

• EU-China summit: Tackling unfair trade practices and over-dependence on China should be on the EU’s agenda in Beijing, writes Anders Fogh Rasmussen, but so should the country’s human rights abuses and military provocations.

• Workplace devotion: Management experts say loyal staff are inclined to invest more time and effort in their jobs, but as Anjli Raval writes, loyalty is sometimes seen as such a force for good that it can be used to justify bad behaviour.

Chart of the day

The FT’s ranking specialists delve into data from the 2023 European Business Schools Ranking to compare the continent’s institutions with global rivals on salaries after a Masters in Management (MiM), MBA or Executive MBA (EMBA) programme, as well as alumni seniority and carbon targets.

Take a break from the news

From staterooms lit by candlelight and festooned with decorations in Norfolk to an atmospheric cluster of historic buildings-turned-hotel at the gates of Edinburgh Castle, enjoy these 15 festive events in the UK.