Media Talk Africa: Latest Headlines in Politics, Business, Sports, and More

In a significant development, the United States has lifted sanctions that previously barred financial transactions with Russia’s Gazprombank related to Hungary’s Paks-2 nuclear power plant project. This move comes as a relief to Hungary, which has been seeking to secure its energy supply. The US Office of Foreign Assets Control (OFAC) issued a general license on Friday, granting Gazprombank and several other Russian banks permission to conduct transactions related to civil nuclear energy.

The Paks-2 project, launched in 2014, involves the construction of two reactors by Russia’s Rosatom, with a €10 billion ($11.7 billion) Russian loan covering most of the estimated €12.5 billion cost. The project is critical to Hungary’s energy security, as the existing Paks NPP supplies about half of the nation’s electricity. However, US sanctions on Gazprombank had forced construction to pause, prompting Budapest to appeal for a waiver.

Hungarian Foreign Minister Peter Szijjarto welcomed the US decision, stating that the sanctions had placed Hungary in an “extremely difficult situation” and undermined its energy supply. He expressed gratitude that the US government has now lifted the restrictions, citing the new president in Washington who views Hungary as a friend. Szijjarto emphasized that the Paks-2 project guarantees Hungary’s secure energy supply and will allow the country to cover most of its electricity needs by the mid-2030s.

Hungary has been opposed to Western sanctions on Russian energy since the Ukraine conflict escalated in 2022, arguing that these imports are essential for national security. The country maintains a long-term gas deal with Gazprom and gets the bulk of its oil and gas from Russia under exemptions secured from EU restrictions. Recently, Budapest blocked a European Commission proposal to phase out Russian gas imports by 2027, warning that this move would “destroy Hungary’s energy security” and raise costs sharply.

The OFAC license also lifts restrictions on civil nuclear-related transactions from the Russian central bank and several other lenders, including Sber Bank, Vnesheconombank, Alfa-Bank, VTB, Otkritie, and Rosbank. This development follows a thaw in relations between Russia and the US amid diplomatic efforts toward a peaceful resolution of the Ukraine conflict. The move is expected to have significant implications for Hungary’s energy security and the broader European energy landscape.