The week: The subtle art of outsourcing, wasting water and behaving badly

Sorry, but it has to be said: it's hard to understate what a grandiose fuck-up this is. Bulgaria is a functioning country, with working institutions, a member of the EU, with tourism opportunities, culture and you name it. And it's announcing to the whole world that it is simply incapable of organizing a meeting it had already lobbied for and agreed to. Why? Oh, no time to do procurement for hotels, and transportation, and also, it might prove way too expensive, and the Ministry forgot to mention this when they were putting together the budget and you see, the whole thing is best called off. My favorite part of the whole charade is "the secret services said it can't be done". Like, a UNESCO meeting is too dangerous, better host a football game?

That's that. So now that you've been briefed on our capabilities in the cultural and organizational sphere, let's turn to an issue that's rather more serious: defense.

This week, EU leaders got together to discuss what to do after the US effectively showed them the middle finger and reminded them that without the Americans, NATO is a sham. A new "Rearm Europe" plan for 800 billion euro is in the works, says the European Commission. The first 150 billion in loans are on the table and might be voted through this week, in much the same fashion the post-COVID Recovery and Resilience Package (RRP) was.

Bulgaria's new government went to Brussels with the same idea it had with UNESCO. We have this money on the RRP plan that we are not going to be able to use. Why not transfer them for rearmament? That's what Prime Minister Rossen Zhelyazkov said.

There are several issues with this.

First, nobody knows how much money we're talking about. At present, we won't be getting around 600 million euros for the second payment. Yet there are 7 more payments, worth a total of little under 5 billion euros. In case you don't know already - we are most probably not getting them either. Each of them has tens of strings attached, and reforms to be made, the deadlines for them are passing as I'm writing this, and the final deadline for everything to be spent is 2026. Unless Japanese and German accountants take over the government and the Parliament and start running the RRP package, it is not happening.

Second, the Commission already signaled it is not in favor of mixing the two packages. The RRP was "money for reforms". The rearmament is going to be a whole different game.

And third, why on earth would you let Bulgaria handle the money for such an important thing as rearmament, since it wasn't able to deliver on previous commitments? It wasn't able to start the retrofitting program, which benefits thousands of people. It wasn't able to buy trains, although it had the money for over 2 years. It is not even capable of organizing a cultural gathering, so it must outsource it to Paris, for Christ's sake!

So in a nutshell: my honest belief is that if we want this rearmament thing to work, we'd better not leave it to national governments. It will be stuck in corruption, local deals, and inefficiency. I'm pretty sure if you ask the Bulgarian arms industry what they prefer, they would much rather go for a pan-European procurement process. Otherwise, we all risk in 5 years' time the next Bulgarian government going cap in hand to Brussels and asking whether we can outsource our defense to, say, Berlin. Just this time, you know.

Politics this week:

"I truly hope, since you did not wish for a prime minister who could handle this complex situation, that Rosen Zhelyazkov will be able to react on the spot". Not exactly the compliment you wish your boss would give you, but that's what GERB's leader said of his current PM before the EU Council on Thursday.

And if that wasn't enough, Borissov underscored that "the ruling majority is not stable at all".

Evidence: the first public spat

This Thursday, the three parties in the official coalition - GERB, Socialists and TISP, gave a briefing to claim the silent fourth partner - the party of the Turkish leader Ahmed Dogan, has been blackmailing them for positions and for "people with criminal background". Dogan's people on the other hand, claimed the government is "negotiating in the dark and is in the suffocating embrace of Delyan Peevski". As if that comes as a surprise to anyone.

Case in point: no Parliamentary oversight regarding the problems with the European prosecution

We devoted our last edition to the desperate fight for justice, led by the EPPO in Bulgaria. After that momentous interview, some parliamentarians wanted to create a commission to investigate cases of sabotage, delays, and obstruction by Bulgarian institutions against the European Public Prosecutor's Office. Not so fast, said the ruling majority. The proposal was rejected with 98 votes in favor, 92 against and 40 abstentions. All the votes against and abstentions came from the ruling parties.

So, newelections?

The budget and the eurozone - those are the two priorities GERB has. Seems to us they might also want to vote in a few new regulators, to cement their power. But all in all, it's beginning to look like this government could well be gone by the summer.

Between Trump and Ursula

The new tide in international relations, unleashed by Trump's administration, is rocking the Bulgarian boat violently. Although the government claimed we are all for the EU plans, Boyko Borissov already signaled an ambivalent position by (literally) copy-pasting the Georgia Meloni position on the Zelensky-Trump spat from last week. President Rumen Radev, who has always believed that Ukraine should go for a peace deal rather than fight, found himself vindicated and triumphant. Most parliamentary parties, including TISP, BSP, Vazrazhdane and Mech also openly sided with Radev and called the EU "militaristic". Even Peevski, who got a medal from the Ukrainians last November, changed tone and said that no more support should go to Kyiv, as "all of the money is needed here, for the [Bulgarian] people."

Economy:

After more than 4 hours of heated debates until midnight, the National Assembly adopted the draft budget for this year with the votes of the deputies from GERB, TISP, BSP and the two Turkish parties - both Dogan and Peevski backed the bill, which received the support of exactly 152 MPs. The pro-liberal conservatives from WCC-DB voted with Pro-Russian Vazhrazdane against the budget.

The final vote will be coming next week.

Meanwhile: a minus 1 billion in February

After the unusual delay of the January budget execution data, the Ministry of Finance published the information for the first two months of the year all at once. They show that at the end of February the state finances were at a deficit of 1 billion levs, or about 0.5% of GDP, after January ended with a cash surplus of over half a billion levs. It was mainly due to more VAT and an excess of revenues over municipal spending. This is about the consolidated fiscal program figures, which are on a cash basis and the account includes, in addition to the state budget, those of the state social insurance, the National Health Insurance Fund, municipalities and others.

Figure

⅔

The market share of the privately owned train cargo companies in 2023, which significantly overtakes the state-owned railway company BDZ

700 000

Liters of mineral water wasted per day in the sewage system because Sofia's Central Bath is not working. This is the estimate the economist Ivo Anev did for Dnevnik.

Business:

Fantastico

The Bulgarian supermarket chain will enter Plovdiv with a large facility. The company has rented the 10th pavilion in the Plovdiv Fair and is starting a large-scale renovation, with an expected investment of about 20 million levs.

ENERGY

Watch out for:

Galina Girginova

The judicial reporter won a case against Bulgaria in the European Court of Human Rights in Strasbourg. It concerned the refusal of the Bulgarian court to provide her with the reasoning behind the acquittal of former Interior Minister Tsvetan Tsvetanov in one of the cases against him. This is related to Tsvetanov's decision to reject the use of special surveillance tools against a supposedly corrupt policeman even though a court has already authorized it. The reasoning was classified under the pretext of national security, and two judicial instances refused to consider Girginova's request for access to information.

Martin Georgiev

The head of National Electric Company has been replaced. This was done by a decision of the company's principal - the Bulgarian Energy Holding. It's a surprise decision, given that no prior indication has been given of plans to change Georgiev. Georgi Dobrev, who has extensive experience in the energy sector, will now head NEK. His growth in the sector, as well as his previous political appointments, are mainly related to GERB and took place during the managerial mandates of Boyko Borissov

Institution

WU Executive Academy

Capital Weekly and the WU Executive Academy, which is part of the Vienna University of Economics and Business - are providing an opportunity for Bulgarian professionals to receive 7 scholarships worth a total of 105,000 euros to participate in three Executive MBA programs: the Vienna EMBA, the Bucharest EMBA, and the Global EMBA. For more information, contact Alexander Damev Senior Training and Education Consultant at WU Executive Academy at [email protected].

Zen of the week:

Photographer: Антон Чалъков

Source: Дневник

Despite everything, it is still hard being the Russian ambassador in Sofia. Lady (or as some suggest - Colonel) Mitrofanova was ambushed after being recognized at a cultural event in Sofia and shouted out with cries of "This is not Moscow". Ironically enough, the event was an exhibition of a group called Guerilla Girls under the headline "The art of behaving badly".