"A normal state is one where everything is sane. In which everyone does their own duty, everyone has rights over his or her own life. Where power is not a source of wealth, and where the medic, the architect, and the farmer get more than the MP or the minister. This is the country I want to turn Bulgaria into."
You may think this sounds like the mantra of current Bulgarian Prime Minister Kiril Petkov, right? Yet you would be mistaken. Those words were spoken more than 3 decades ago - in 1991 to be precise. They were the words of the first PM of post-communist Bulgaria Philip Dimitrov. I find myself reflecting a lot on Mr. Dimitrov these days (on the picture sitting on the ground with glasses on). Because, in a strange twist of history, time and political (mis)fortune, Petkov is increasingly looking like the direct heir to Dimitrov.
They have a lot in common. Dimitrov took up the reins of power after decades of decay, corruption and mismanagement, faced by non-functioning institutions, stuffed with communists. Inflation was growing. New, peripheral dark forces in Bulgaria's gray economy were gaining traction - mutras, mafia and organized crime. The economy was silently being divided between the powerful figures of the past. And on the borders of Bulgaria, war broke out - and Yugoslavia began to tear itself apart.
The mild-mannered, soft-spoken liberal Dimitrov stood no chance at all. His government lasted a little more than a year, and was taken down by a colorful no-confidence vote in parliament, when the President publicly withdrew his trust.
I'm sure that by now you see the parallels.
Petkov has inherited a country rife with corruption and mismanagement and stuffed with GERB-loyalists. He is stymied every step of the way by the deep state GERB created and thwarted by the prosecution service which has dropped any shred of pretense and has publicly sided with the ex-government. Inflation is here, and yes, there is a war.
So the first 100 days of this government (which are commemorated this week) have an air of deja-vu. The Petkov cabinet seems to be hanging by a thread, yet it is surviving, for now. And it's clear that this is the most challenging set of circumstances facing any PM for ages. This doesn't acquit the ruling coalition of its mistakes and reckless overreaches (like the arrest of the ex-PM Boyko Borissov which turned out to be a lot less substantial than people hoped). Yet, truth be told, they are doing the best they can.
It's perhaps a sobering thought that after Dimitrov, Bulgaria entered a dark period - a lawless time of thugs and crooks, which ended with the national banking crash and hyperinflation in 1997. The only remaining political inheritance preserved from Dimitrov's time was the recognition of then Macedonia as an independent state.
One must surely hope we grew wiser over the past 3 decades. And if Petkov manages to ride out this storm, he'll be in for a rather long journey.
This newsletter was helped by
Martin Dimitrov & Anina Santova
POLITICS THIS WEEK
Speaking of missteps: the Borissov arrest saga continues
It started with the 24-hour arrest of the former Prime Minister and GERB leader, alongside several of his top-ranking party acolytes, but then it spilled on and on. Mr. Borissov was released from arrest last Friday evening after the State Prosecution refused to launch an investigation over his alleged participation in an extortion scheme involving former lottery mogul Vassil Bozhkov.
The prosecutors claimed the Internal Ministry did not follow procedural rules when it rushed Mr Borissov's arrest and failed to file all required evidence and documents that ought to have led to his permanent arrest. On Monday the police did so, but this only led to the Prosecution finding another ground for dismissal; it announced it will repeat all actions done by the police investigators at the end of last week.
Did you honestly believe this Prosecutor General was about to turn?
Truth be told, the whole affair was rushed by the authorities and was probably more for show than substance, or a bungled solo operation rushed by Interior Minister Boyko Rashkov. But let's be honest: there was not a chance in hell this PG would do anything against his comrades in GERB. And the spectacle was well designed to show that.
One point: 550 million levs
They are missing from the state coffers, according to calculations of the official audit arm of the Finance ministry. The culprit is somewhere in the Finance Ministry, led at that time by Vladislav Goranov. Yet the Prosecution didn't even bother starting procedures. Need we say more?
Still no weapons for Kyiv
The other big news this week came from Brussels, where President Rumen Radev attended the extraordinary meeting of NATO heads of states. The leaders announced plans to expand their presence on NATO's Eastern flank with four new multinational battlegroups, including in Slovakia, Hungary, Romania and Bulgaria. It is still unclear who will participate in Bulgaria's battalion and if there will be deployments beyond the US-promised Stryker armored vehicles.
Mr. Radev also said he continues seeking ways to keep Bulgarian military aviation flying. Earlier this week, he spoke with Polish President Andrzej Duda about repairing Bulgaria's MiG-29s in Poland (as they were being repaired in Russia until now, which is obviously out of limits), but on Thursday said he is probing other options, including renting European jets or buying second-hand F-16s to substitute for the delay in the delivery of the new jets by Lockheed Martin.
Oh, and Sofia kept repeating the old line: we won't be sending military supplies to Ukraine - because our own army is undersupplied.
Don't be fooled: Bulgarian weapons ARE in Ukraine
The country boasts a large arms complex and it HAS to sell somewhere. They are privately sold though, through other countries, as they have always been.
Two coalition shakers: Zelensky and BNB governorThe Ukraine crisis has entered Parliament again - this time, over the proposal by Democratic Bulgaria for a virtual address by Ukrainian President Volodimir Zelensky. According to Dnevnik.bg, the proposal was not exactly welcomed by another coalition partner - BSP, as an MP of the party was quoted as saying off the record that if Mr. Zelensky is allowed a hearing, the same privilege should also be granted to Russian President Vladimir Putin.
They really seem to be caught between a rock and a hard place, those old commies: despite attempts by the party's more liberal wing to keep a pro-Western rhetoric, old Russian predilections still hold sway.
The other coalition shock will come through another partner - There is such a people. This week the biggest member of the ruling coalition WCC nominated the head of its Parliamentary group, financier Andrei Gyurov, to head the Bulgarian National Bank. As the only formal nomination so far has been that of their coalition partner from TISP, banker Lyubomir Karimanski, this would surely cause tensions. Especially when we bear in mind Mr. Karimanski has worked hard to get the support of the opposition to get himself elected. See more about this clash in our roundup of the cabinet's 100 days in power.
9% up since 2020, but still last in the EU
That's the growth rate of GDP per capita, measured in PPP. It reaches 17 900 euro for 2021, which is 9% growth since 2020. Yet it still is 45% of the median for the EU and positions the Bulgarian economy in last place in the union.
We want another sea!
This is the government's ultimate goal, given its newly announced plans to participate in the bid for Alexandroupolis port. Prime Minister Petkov and Transport Minister Nikolay Sabev are in on the deal, which is supposed to see Sofia take part in the already ongoing bidding process. "Capital" learned that Sofia will either decide to go with the winner of the current concession procedure or will negotiate with the two companies, who are favorites to win beforehand. How much that will cost is still uncertain. This will be the first Aegean port Bulgaria seeks to procure, even though it exports a lot through those channels even at present.
More money from T-bonds
Bulgaria sold 7-year government securities at the auction on Monday. The yield reached 1.33% with an interest rate coupon of 0.25%. The proposed amount was 500 million levs, and the primary dealers have placed orders for nearly 600 million levs, which is a coefficient of coverage of 1.20. The result is not quite impressive due to the uncertain global environment, according to market representatives. At the auction in November, when the Ministry of Finance opened an issue with the same parameters, the yield was 0.49%.
Is the growth of employer expenses for each working hour in the last quarter of 2021, compared to 2020. BUSINESS
The Bulgarian holding already controls almost 100% of ex-CEZ energy distribution and will take the company off the stock exchange. The deals were worth a total of 103 million levs.
The German company has begun a wind project near Balchik. It will be for a 75 MwH plant and it will consist of two separate wind farms. The investment is anywhere between 90-120 million euro. The Bulgarian investor is named "Viataren park Dobrudhza 2"
The Bulgarian battery maker plans to sell its Austrian branch Monbat Immobilien together with its real estate, worth more than 30 million levs. This should be voted through on 21 of April. There are already prospective buyers and the revenue will be invested in the main business of Monbat.ENERGY
A big flood and a lot of questionsThe biggest water cascade in the whole SouthEast Europe region - Pavetz chaira, which is equivalent to one nuclear reactor in power, was supposed to be turned on and start producing energy, while lowering the prices this week. Yet, after a year or more of reconstruction, when switched on, it fell apart. When water was rushed in through the pipes in the 700 meters vertical drop, it blasted out the rotor blades and destroyed the turbine. The Energy Ministry says it is investigating how a repair can be done without necessary computer simulations to make sure everything is in order. Other voices are calling it a sabotage - without Pavetz chaira, some other plants are making money on the market - namely Mr. Dogan and Mr. Kovatchki.
WATCH OUT FOR
Eleonora Mitrofanova - the Russian ambassador to Sofia, who called the Prime Minister "a bureaucrat who shouldn't criticize the ambassador of the Russian federation" this week, might finally be dispatched back to Moscow after Mr. Petkov recalled Sofia's attaché to the Russian capital for consultations.
Laura Kövesi - the new European prosecutor general, in whom so much hope has been invested to clear the muddy fields of Bulgarian corruption. She has just announced she is investigating tip-offs amounting to more than 900 million levs worth of EU money in Bulgaria.
The Bulgarian football union - which has split in two, after former Man Utd striker Dimitar Berbatov led tens of clubs into participating in a spin-off congress to vote him in as chairman. In retaliation, the original BFU led by Borislav Mihaylov excommunicated most of the said clubs.
Sofia where tens of thousands of people gathered to mark 1 month since Russian invasion in Ukraine, sending a strong signal to the government of the pro-Ukrainian sentiment in the country.
1 April - the day the moratorium forbidding utility price hikes, which was the first piece of legislation to be agreed by the new Parliament in December of last year, lapses. According to the new head of the Energy and Water Regulator (KEVR) Stanislav Todorov, this should not lead to a significant increase in prices.
WORD OF THE WEEK:
Gionsurat - Rubber face
This comes from the Turkish words for rubber and face and means someone who has the audacity of a lout and about the same tact. Mostly, it is directed at people who tend to demonstratively ignore their mistakes, sins or past behavior while claiming they are right and virtuous. Case in point: Prosecutor General Ivan Geshev who claimed this week he is the "only thing standing" between society and power abuse. Or Russian ambassador Eleonora Mitrofanova who .. oh well, you already know. Plenty of gionsurats around.