C O N F I D E N T I A L SECTION 2 OF 03 SOFIA 000590

SIPDIS

SIPDIS

FOR NSA HADLEY FOM AMBASSADOR BEYRLE

E.O. 12958: DECL: 05/14/201
TAGS: PREL OVIP BU
SUBJECT: YOUR JUNE 10-11VISIT TO SOFIA

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the highest percentage in any EUcountry. Today, an ethnic
Turkish party is a meber of the ruling coalition. Mosques,
synagogue and churches need no special security or police
rotection. A deeply-rooted tradition of acceptance--
against the backdrop of the country's membersip in NATO and
the EU and stong ecoomic growth -- makes Bulgaria a strong
model for its neighbors to the West, which would like to
replicate these successes. Bulgaria has been supportive of
quick resolution of Kosovo's status through a UNSC
resolution. Parvanov and Stanishev have carried this
rhetorical backing a step further, engaging personally with
Kostunica, Tadic and other Serb leaders and urging them to
focus on their future in Europe instead of a past they can
never recapture. Bulgarian forces have served with
distinction in Bosnia and Kosovo, adding further stature to
these efforts.

7.(C) We want to see Bulgaria build on this role as a
regional advocate. To the west, Macedonia, Albania and
Croatia will benefit from Bulgaria's counsel as they pursue
their own membership in NATO. To the east, the countries of
the Black Sea region will also find a lot to emulate in
Bulgaria's recent history. Bulgaria serves as the lead NATO
Embassy in Tbilisi, and has (so far) successfully resisted
Russian demands to curb its legal arms sales to Georgia. But
the strong Bulgarian instinct to maintain a lower profile
prevents them from doing even more to build a stronger
consensus on Black Sea deomcracy and security initiatives,
especially with Romania and Turkey. In your meetings with
the President and Prime Minister and your public remarks, you
can urge Bulgaria to elevate its sights and promote its
successes more actively.

Economic Success . . . and some Unfinished Business
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8.(C) When you and President Parvanov met in Washington in
2005, you agreed that we needed to work harder to bring U.S.
- Bulgarian trade and economic relations up to the high level

of our security and political relationship. We have been
working hard at it, and we have some results to celebrate.
The two largest investments in Bulgarian history, totaling
over $3 billion, were made by U.S. companies over the past 12
months. And the roster of blue-chip U.S. firms continues to
grow, including AES, Alcoa, AIG, Microsoft, Hewlett-Packard,
American Standard, as well as dozens of other smaller
companies, especially in the IT sector. USAID assistance
programs helped prime the pump for some of this success: an
enterprise fund started with $50 million in seed captial in
1991 helped create some of the most successful businesses in
Bulgaria today, including a major bank with assets valued at
over $350 million. The returns on these investments have
been capitalized at more than $200 million, which will serve
as the starting endowment for a major U.S.-Bulgarian
Foundation which will continue supporting Bulgarian
entrepreneurs. You will announce the creation of this
Foundation during your visit, a tangible symbol of how the
partnership with the United States has paid off for the
country.

9.(C) But there is a skunk circling this picnic. Like most
countries emerging from communism, Bulgaria endured a wave of
questionable privatizations and suspect sell-offs during the
1990's that enriched a class of "businessmen" with the means
to manipulate judicial outcomes and influence political
decision-making. The most vital piece of unfinished business
in Bulgaria's otherwise successful transformation is
developing the political will among the leadership to
confront the issue of corruption and crime head-on. The Prime
Minister and President need to understand that Bulgaria's
ability to build the stronger partnership with the United
States they seek -- and to increase the flow of Western
investment -- depends on their action to break the habits of
corruption that weaken public faith in democracy. A recent
opinion poll showed that for the first time, a majority of
Bulgarians identify corruption as the single most important
problem facing the country, so this issue is less a favor to
us than a matter of political survival for them.

The Nurses
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10.(C) No issue is more emotionally charged for Bulgarians
than the fate of the five women held under death sentence.
Since joining the EU, the Bulgarians have enjoyed a renewed
wave of support from their European partners in the form of
direct appeals to Qadafi, parliamentary resolutions, and
donations to help treat the HIV-infected children in Libya.
But the President and Prime Minister have told me many times
they believe it is pressure from the United States, in the
end, that will have the decisive effect in getting the nurses


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