Crime a black mark for thriving Bulgaria Financial_Times - 2005/4/26
Yesterday's signing of an EU accession treaty istestimony to how far Bulgaria has come under the leadership of former King Simeon Saxe- Coburg, who became prime minister in 2001 and has overseen a period of impressive economic growth.


A surge in foreign investment - amounting last year to almost 2bn ($1.5, £1bn), equivalent to 10 per cent of gross domestic product - has created new jobs in sectors such as information technology, where Bulgaria has been able to draw upon its Soviet-era role as a centre for IT development.

As a proportion of GDP, the country's debt has been halved in four years to 7.3bn, or 35 per cent of GDP, while the official unemployment rate has fallen to 12 per cent from 19 per cent.

The country joined Nato last year and, according to Solomon Passy, its foreign minister: "Bulgaria has never had such productive relations with all its neighbours in the Balkans."

But the government's success in economic and foreign policy has not been matched in its fight against crime and corruption. Over the past year, about 60 organised crime leaders were assassinated, often in daytime shootings in central Sofia. Ivan Iskrov, president of the Bulgarian central bank, warns: "It is very important for politicians to improve dramatically the judicial system."

Even the IT sector's growth has a dark side. Bulgaria is considered a centre for counterfeiting high-denomination euro notes, credit cards and passports. Boiko Borissov, secretary-general at the interior ministry, says Bulgaria co-operates closely with the UK, Spain - home to a large Bulgarian expatriate community - and the US to fight cybercrime.

"Catching the perpetrators of identity theft has become a priority," he says.

But many alleged criminals escape conviction because of corruption among prosecutors, says Ognian Shentov, chairman of the Centre for the Study of Democracy, an independent Sofia think-tank. "Organised crime, corruption and judicial reform are the three major problems in terms of EU accession," he says. "But the main focus in the next year should be on making prosecutors both independent and accountable."

Meanwhile, industrial restructuring and privatisations have fuelled nostalgia among the elderly and most vulnerable sections of the population for the communist days of the managed economy.

Almost one-quarter of Bulgarian residents are of pensionable age, the highest percentage in Europe. Dissatisfaction with pensions averaging less than 100 ($130, £68) monthly and rising healthcare costs help explain the (ex-communist) Socialists' widening lead over the governing Movement for Simeon in recent opinion polls. According to Nikolay Vassilev, deputy prime minister, there is a 50-50 chance that the national election on June 25 will lead to a coalition government.

Such a coalition would also reflect a narrowing of the ideological gap between political parties that have had to meet the same EU membership conditions.

Mr Vassilev, a 35-year-old former City of London banker, says: "Most of the parties have converged towards broadly the same economic policies - the Socialists have copied most of our ideas." But what Brussels will be more concerned about is whether the next government can come up with fresh thinking about judicial reform.


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