BULGARIA CABINET CHANGES: A MIXED BAG

C O N F I D E N T I A L SECTION 01 OF 03 SOFIA 000256

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/22/2018
TAGS: PGOV PREL BU
SUBJECT: BULGARIA CABINET CHANGES: A MIXED BAG

REF: A. SOFIA 0229

B. SOFIA 0254

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Classified By: Political Counselor Jim Bigus for reasons 1.5 (b) and (d
).


1. (C) Summary: PM Stanishev on April 22 replaced the
Interior, Defense, Health, and Agriculture ministers and
created a new Deputy Prime Minister position to manage EU
funding. Stanishev's move is a cautious, incremental step,
constrained by the need to maintain balance in the ruling
coalition. He had long wanted to rid the cabinet of
incompetent ministers, but was also pressed by ex-PM King
Simeon to remove competent ministers from the King's party
who dared to oppose him. Stanishev also had to show the EU
Bulgaria is serious about reform. The recent MOI scandal that
led to the removal of Minister Petkov gave him an opportunity
to make positive changes while making concessions to satisfy
the partners. Stanishev's choices for Interior and Health
ministers bode well for reform. The disreputable new Defense
Minister, chosen by the King according to coalition
agreement, shows narrow focus on personal interests and
loyalties, and the MRF choice for Agriculture was made for
political optics more than qualification. The new Deputy PM
appears to be a good choice but the position's powers and
resources are still undefined. Overall, the changes will
help the coalition survive until the end of its term, but it
is doubtful they will boost public confidence and satisfy the
EU. Bio clips of the new ministers are attached below. End
summary.

Opportunity and Pressure
--------------


2. (C) This is the coalition's second reshuffle since
taking office in 2005. In 2007, the PM removed the Socialist
Minister of Economy and Energy, who was also involved in a
high profile corruption scandal. Stanishev had long wanted
to replace a number of unpopular or weak ministers to improve
the government's image and chances in the 2009 elections but
was waiting for the right time and optics. He had a longer
list than those who were removed, including more BSP
ministers, but kept the numbers down for the appearance of
proportionality, important to many in the BSP who objected to
their party turning over more ministers than the junior
coalition partners. The Petkov scandal gave Stanishev the
opportunity to get rid of Petkov (ref A),appease the King's
desire to dump his NMSS Defense Minister Bliznakov, remove
the unpopular Socialist Health Minister and MRF Agriculture
Minister, and create a new Deputy Minister position to show
Brussels he is dealing with the EU funds scandals and is
serious about tackling government corruption. EU monitors
will come to Bulgaria in late May to prepare a report
scheduled for release in June on Bulgaria's performance. The
EU has already threatened to impose sanctions, including
invoking the safeguard clause, which many here believe could
bring the government down. (Though few predict that the EU
will fully take the most drastic measures at its disposal.)

Progress
--------------


3. (C) Stanishev wanted to go as far as he could without
destabilizing his own party and the coalition. Finding a
replacement for Interior Minister was the most difficult.
According to sources close to the BSP, Stanishev's initial
choices of technocrats turned down the offer, not wanting to
be in the "hot seat." He successfully resisted President
Parvanov's offer of his chief of staff. He settled on BSP
parliamentary group leader Mihail Mikov, a consensus figure
who is closest to Stanishev but also on good terms with
Parvanov and the various BSP factions. A good contact of the
embassy who worked well with us on DANS legislation, he has a
clean record and positive public image. Stanishev expects
this choice to send the right message to Brussels about
cleaning up the Ministry. At the same time, some local
analysts consider Mikov to be a too mild personality to shake
up the hardliners at the ministry. He will need a lot of
backup from the PM. A critical next step will be the key
position of new chief of staff for the ministry. In a much
easier choice, Stanishev replaced unpopular Health Minister
Gaydarski with Evgeni Zhelev, a respected doctor and former
Socialist mayor of Stara Zagora. A good embassy contact.
Zhelev is energetic, thoughtful and sensible and made Stara
Zagora a well-run city adopting many USAID-modeled civic
reforms.


4. (C) The new Deputy Minister for EU funding, Meglena
Plugchieva, is another consensus choice. A Socialist and
current Ambassador to Germany, Plugchieva is considered a
competent technocrat. A deputy minister during the NMSS

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administration, she is close to Parvanov and has worked
closely with MRF. She faces a formidable task, with as yet
no organizational structure, personnel or funding; the
initial reaction by EU embassies was that this is more show
than substance, adding to their skepticism (even cynicism)
about Bulgaria's performance.

Compromises
--------------


5. (C) According to the deal, the junior coalition partners
could change ministers in one of "their" ministries. When
asked why the disreputable Nikolai Tsonev, a party hack and
former MOD procurement director widely known for corruption,
was chosen to be Defense Minister, a Stanishev advisor told
us, "It was theirs (NMSS) to choose." Accepting Tsonev
contained the King's desire for revenge against other
competent NMSS ministers whom he considered disloyal rebels.
It is nonetheless a lost opportunity to improve the ministry.
As MOD comes under the direction of Deputy PM and FM Kalfin,
we will continue to work productively on our bilateral
military issues. The predominantly Turkish MRF holds the
Agriculture Ministry. Valeri Tsvetanov, an ethnic Bulgarian
MRF member, is a shrewd choice but he is an academic with no
previous senior level political or management experience.

EU Relations
--------------


6. (C) The cabinet changes maintain the balance within the
BSP and Coalition, improving Stanishev's chances of
fulfilling his goal to be the first Socialist PM to survive a
full term in office. But he will have to do more to impress
the EU. The visiting EC Monitoring Team told us on April 17
(ref B) that Brussels is increasingly frustrated with
Bulgaria's performance on rule of law and corruption and is
increasingly willing to take a hard line with Sofia,
including sanctions. Stanishev reportedly told his close
associates after the BSP plenum on April 22 that the top
short term goal now is to avoid imposition of the safeguard
clause, which could bring down the government.

COMMENT
--------------


7. (C) The changes are a definite mixed bag -- a measured
incremental step in the right direction that is a win for
Stanishev over the hardliners in his own party, but hardly
enough to make a dent in confidence levels. Several bits of
good news: Mikov is a definite plus at Interior; competent
NMSS ministers stay in place; Plugchieva will add discipline
and EU-savvy to dealing with Brussels; Zhelev will help the
BSP with the electorate. And some big minuses: Tsonev is a
wasted choice; we'll still rely on key MOD deputies, FM
Kalfin and the PM's and President's advisors to move the ball
on key defense/security issues and get done what we need to
get done. The biggest opportunity cost: the shake-up is not
nearly enough to impress the public or Bulgaria's
international partners that it is turning the corner on sound
governance and corruption issues.

BIO CLIPS
--------------


8. (C) Mihail Mikov, 47, a senior Socialist and third-time
MP, currently chairs the BSP parliamentary group and sits on
the Parliament's Legal Committee and European Affairs
Committee. A lawyer by training, Mikov played a constructive
role in the adoption of progressive legislation such as the
2007 amendments to the Constitution, legislation on DANS and
the politically sensitive law on the disclosure of
communist-era State Security files. Mikov is largely
perceived as a consensus figure; he is close to PM Stanishev
and also enjoys good ties with President Parvanov and works
well with the main lobbies within the BSP. Mikov enjoys a
positive public image and, unlike his predecessor, has never
been involved in any corruption scandal. A good contact of
the Mission, he visited the U.S. on a two-week IVP in 2001.

Meglena Plugchieva, 52, who currently serves as Bulgaria's
Ambassador to Germany, is a respected Socialist largely
perceived as a technocrat rather than a political figure.
Before assuming her diplomatic post in late 2004, Plugchieva,
who has a PhD in agricultural studies, served as Deputy
Minister of Agriculture responsible for European integration
in Simeon Saxe-Coburg's government (2001-2004). Plugchieva,
a renowned expert in the area of agriculture and ecological
studies, has specialized in Germany and has over 20
publications on ecology, agriculture and forestry. She
headed the Agriculture Ministry's Foreign Relations
Directorate (1990-1995) and in 1995-2001 served as a

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Socialist MP and member of the foreign policy, agriculture
and ecology committees in parliament. Plugchieva enjoys good
ties with President Parvanov to whom she owes her appointment
as Ambassador.

Nikolai Tsonev, whose name is little known to the public, is
Simeon's surprise choice of a new Defense Minister.
Since 2002, Tsonev has served as executive director of MOD's
executive agency on social care. Before that, he served for
a year as an advisor to former Defense Minister Nikolay
Svinarov. Tsonev graduated from the Military Academy in Kiev
and has a degree in philosophy from Sofia University St.
Kliment Ohridski. According to local press reports, Tsonev
is a shareholder in the companies Bulpaper, Nilana and
Pakpaper, some of which are supposedly MOD suppliers and
contractors, which has created a perception of conflict of
interest.

Evgeni Zhelev, a Socialist, served two terms as Mayor of
Stara Zagora until his surprise loss to the center-right
candidate in the last year's local election. A medical
doctor by training, Zhelev has previously headed the city
hospital in Stara Zagora. Zhelev is close to President
Parvanov and was appointed as his advisor following the loss
in the local election.

Valeri Tsvetanov, born in 1951, has a doctorate in
agricultural sciences, currently a senior fellow at the
Institute of Soil Science and Agricultural Ecology. He is
tainted by accusations of conflict of interest.

Beyrle