EU Withdraws Bulgaria’s Funding, Imperiling Government

Economically, Bulgaria is an emerging regional leader. Although it began to institute democracy when it renounced Communism in 1990 with the fall of the Iron Curtain, the country did not implement market reforms until about a decade later. The reward? Six percent annual growth from 2004 to 2007, EU admission and billions in allocated funds to jump-start infrastructure.

But as Jacki Davis, an analyst at Brussels’ European Policy Centre told the BBC, “Negotiating the terms of your EU membership isn't the end of the story. If you make promises, you have to live up to them. So it’s shape up or face sanctions.”

The EU already had trepidations about accepting a country with numerous reports of collusion between government leaders and mafia bosses, and feeble efforts to end such corruption. As The Economist put it, once Bulgaria “gained membership, those efforts became even feebler.”

OLAF, the EU’s antifraud monitoring group, also cited €36 million in diverted funds from the agricultural Sapard program.

The Phare Project, which provides funding and support to EU applicant countries and new member states, is set to rescind at least $390 million in unspent grants, and possibly triple that amount.

In acknowledgement that the country is falling short of EU standards, Bulgarian Prime Minister Sergei Stanishev said, “The truth is Bulgaria is learning how to manage EU funds.”

But it could be too late for Socialist Bulgaria to prove itself capable of fighting crime. Last week, opposition factions moved for a no-confidence vote against the Cabinet and are pushing to impeach President Georgi Purvanov over issues related to EU allegations of corruption.

See BBC coverage