BULGARIA has changed governments four times in the last 18 months. On October 5th
Bulgarians will vote for another one. After nearly two years of
political instability, which began after anti-poverty protests led to
the resignation of the centre-right government of GERB in February 2013,
the poorest member of the European Union seems to have come full
circle.
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GERB and its leader, Boiko Borisov, a former prime
minister, are tipped to win more than one-third of the votes even if
they will be short of a majority. The Socialists, whose embattled
government resigned on August 6th after a year in power
marked by mass protests, are distant second with about 22% of the vote,
according to Alpha Research, a pollster. The ethnic Turkish party, DPS,
which was part of the Socialist cabinet is currently polling third at
around 12%. Four more parties are flirting with the 4% threshold to
enter parliament, including the rightist Reformist Bloc and the populist
“Bulgaria without Censorship” of former journalist-turned-politician Nikolay Barekov(pictured).
Mr
Borisov, a burly former firefighter, will thus face a challenge to form
a stable government in a starkly polarized parliament. But a stable
government is urgently needed in Bulgaria as the country is facing a
host of problems, including a still-unresolved failure of a major bank, a
sluggish economy and an increasing Russian pressure over a gas
pipeline.
The case of the Corporate Commercial Bank (CCB) appears
most pressing. CCB, the fourth largest lender in the country, has been
closed since June 20th after a run. Alarmed by news reports
of dubious deals by the bank’s main shareholder, Tsvetan Vassilev,
customers withdrew more than one-fifth of the bank’s deposits.
Prosecutors have charged Mr Vassilev, who is currently residing in
neighbouring Serbia, with embezzlement. He denies any wrongdoing.
While
politicians are still wrangling whether the state should bail it out,
let it fail or wait for its shareholders to recapitalize it, the bank’s
fate remains hostage to the political vacuum. (An interim cabinet with
limited powers it is in power until the elections). More worryingly,
over 200,000 depositors have had their money blocked at CCB for more
than three months now and hundreds of them have been staging protests in
the past weeks demanding access to their accounts.
A significant
chunk of the economy, from small firms to much of the country’s military
industry, municipalities and schools that have parked their money at
the bank, has also been affected. This threatens to derail an already
shaky recovery.
Bulgaria has seen its growth prospects falter amid
the domestic political uncertainty, poor weather this summer that will
affect the harvest and the crisis in Ukraine. That conflict has already
resulted in declining exports to Russia and Ukraine because of the trade
sanctions. A further tightening of the sanctions (for example, a more
rigorous EU visa regime) would badly affect tourism. Russians are the
single largest group of tourists in Bulgaria.
But Russia’s
engagement in Bulgaria goes way beyond tourism. It supplies as much as
90% of Bulgaria’s natural gas and is deeply involved in its energy
sector. Bulgaria is one of the key countries along the route of South
Stream, a planned pipeline crossing the Black Sea to bring Russian gas
to the Balkans and to Western Europe.
So when earlier this year the European Commission urged
Bulgaria to stop work on the Gazprom-led pipeline as it was in defiance
of EU rules on energy liberalisation, Russia, in turn, increased its
pressure over the country to continue with the work. And although the
interim government confirmed in early August that the construction has
been frozen, news reports
later suggested that parts for the pipeline were still being delivered.
“Russia is currently exerting huge pressure over Bulgaria,” said
Tihomir Bezlov of the Centre for the Study of Democracy in Sofia. “The
Russians still think in their old imperial models.”
Mr Borisov has
already declared that Bulgaria would back the South Stream project only
if it got the EU's approval. But with the pipeline becoming entangled
in the geopolitics of the Ukraine crisis, a quick resolution seems
unlikely. The new government, like its last four predecessors, will have
a rocky start.
#Source:
Bulgaria goes to the polls (again) | by G.K. | SOFIA
Sep 25th 2014, 12:06
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