BULGARIA CAUTIOUSLY OPTIMISTIC - PERHAPS OVERLY SO

C O N F I D E N T I A L SECTION 01 OF 02 SOFIA 001785

SIPDIS

E.O. 12958: DECL: 10/12/2015
TAGS: PGOV BU EUN
SUBJECT: BULGARIA CAUTIOUSLY OPTIMISTIC - PERHAPS OVERLY SO
- ON EVE OF EU ACCESSION REPORT


Classified By: JEFFREY D. LEVINE FOR REASONS 1.4 B & D


1. (C) SUMMARY: All eyes are on Brussels on the eve of the
October 25 European Commission (EC) progress report on
Bulgaria's EU accession. The government is engaged in a
complex strategy of playing down the public's expectations,
encouraging parliament to pass the necessary legislation -
particularly in the Justice and Home Affairs (JHA) area -
while firmly maintaining its suitability to enter on schedule
in January 2007. GOB officials tell us they are certain that
Bulgaria is as ready for entry as other recent admitees were
14 months before their accession. The Prime Minister has
publicly said Bulgaria should not be held to a higher
standard than the others. The upcoming EC report is expected
to be another warning to Bulgaria to step up efforts, but is
not likely to give a clear signal of whether they will enter
in 2007 or be delayed until 2008. The Minister of European
Affairs, among others, has warned that the current coalition
government would not survive a delayed entry. END SUMMARY

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THE BACKGROUND
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2. (U) The EU Member States (MS),along with Bulgaria and
Romania, signed the Accession Treaty on April 25, 2005 in
Luxembourg, with a goal of EU entry on January 1, 2007.
Under pressure from states which questioned the two nations'
preparedness, safeguard clauses were installed that allow for
a delay of one year to January 1, 2008, if the MS feel the
countries are not ready. In the case of Bulgaria, delay
requires unanimous approval. However, entry also requires
that all current MS ratify the accession treaty by December
31, 2006. Bulgaria ratified it on May 11, 2005. Hungary,
Slovakia and Slovenia have also ratified so far, with Greece,
Italy, Spain, Portugal and the Czech Republic reportedly
close.


3. (C) Throughout the last few years of the accession
process, Bulgaria had been seen as having a lead on Romania.
Many Bulgarians feared their accession could be delayed by
Romania's slow progress. However, since the "No" votes on
the EU constitution in France and the Netherlands, combined
with a slow post-election coalition-building period here, and
resultant delays in implementation of much needed reforms,
the EC has appeared more hesitant about Bulgaria.


4. (C) Minister for EU Affairs Meglena Kuneva recently told
Ambassador Beyrle that delay to 2008 would be very harmful
for Bulgaria's economy in addition to damaging the "national
psyche." As an example of the damage that could be done, she
described how "good" businesses have invested in necessary
changes to comply with EU regulations. These businesses will
be at a disadvantage in the local market that could threaten
their existence if accession is delayed.


5. (C) Perhaps more importantly, however, Kuneva and others
fear a delay would shatter the already tenuous governing
coalition, leading to even further delays in needed reforms.
It is "now or never, with our two-thirds majority in
Parliament," Kuneva said. She also asserted to Beyrle that
criminal interests profit by the status quo and are working
against Bulgaria's entry by slowing implementation of
judicial and law enforcement reforms. In addition, Kuneva is
concerned that factors outside Bulgaria's control, such as
public sentiment in many EU states, overall enlargement
fatigue, and an unspoken understanding within many EU states
that neither Bulgaria nor Romania are especially desirable
countries, could trip them up. There is also the deterrent
factor: delaying Bulgaria's (and Romania's) entrance would
send a very effective message to Croatia and Turkey that the
EU is serious about maintaining its standards.

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THE EFFORT CONTINUES
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6. (C) Bulgaria is working hard towards a 2007 entry.
Externally, the GOB is trying to speed up the ratification
process in the MS. Internally, Bulgaria has several
commitments to work on, including implementation of EU
criminal justice directives. Kuneva said the implementation
process has been very good for modernizing Bulgaria. She
ticked off efforts at revamping the criminal procedure code,
legal aid, witness protection, court administration,
restructuring of the Ministry of Interior, and other
accomplishments as evidence of Bulgaria's progress. Kuneva
also pointed to several scandals in the current MS, e.g.
Parmalat, to show Bulgaria is not the only source of
corruption in Europe. She also mentioned to Ambassador
Beyrle that in Bulgaria much depends on the personalities
involved in key areas, and stressed the need for strong,
clean figures as heads of the Supreme Court (Cassation),
Constitutional Court, and the Prosecutor General's Office.


7. (C) The Head of the EC Delegation in Sofia, Dimitris
Kourkoulas, told the Ambassador that there is no question of
"whether" Bulgaria gets into the EU, only of "when."
Kourkoulas said that of the five areas listed in a June 2005
"early warning letter" as needing improvement, only failure
to act decisively in JHA areas - particularly to reform the
judiciary and combat corruption - would be a deal-breaker.
Kuneva also acknowledged Bulgaria's need to strengthen
efforts in the justice field. Three other areas - freedom to
provide services, agriculture, and environment - all hold
financial incentives for Bulgaria to act quickly, so the EC
is not worried about their eventual implementation. In the
fifth area, IPR protections, the EU is deciding how hard to
come down on Bulgaria's efforts.


8. (C) The Comprehensive Monitoring Report, which the EC will
issue on October 25, will assess progress up to September 30
this year, and will highlight remaining shortcomings.
Kourkoulas told us he expected the report to be another
strongly-worded but open warning, with no clear indication of
whether Bulgaria will enter in '07 or '08. He thought
Bulgaria and Romania would be linked. The EC will release
the final monitoring report in March 2006, along with its
final recommendation. The heads of government of the EU MS
will make the final decision in June 2006.


9. (C) Kourkoulas cautioned the Ambassador that in an extreme
case, if MS vote to delay entry until '08, it could set off a
chain of unforeseen events that could block the accession of
new entrants. Kourkoulas agrees that a delay could bring
down the current coalition in Bulgaria, and could also give
current EU opponents of enlargement momentum to close the
doors. The EC is under public pressure to show it is
seriously enforcing its requirements, and to show EU citizens
that their opinions on the future of their Union are
considered. Kourkoulas said a successful entry will help
Bulgaria substantially, both economically and politically,
and will act as a model for both the Western Balkans and
Turkey. Personally Kourkoulas feels that Bulgaria will move
more quickly on reforms through their entry. However, he
acknowledged that some MS do not think Bulgaria is ready to
join the team.


10. (C) COMMENT: Bulgaria is at a crucial point in its
post-communist transition. The new government has its full
focus on preparations for a January 2007 entry, and is
continuing the legislative and constitutional marathon begun
by its predecessors. The government has also asked for our
political support of its 2007 entry. There are many issues
beyond Bulgaria's control that could slow their entry.
However, much of the country's future success depends on its
ability to quickly and decisively move forward with serious
reforms in order to convince the EC of Bulgaria's readiness
to play in the big leagues. END COMMENT
LEVINE