SCENESETTER FOR VISIT OF DAS JONES TO SOFIA,

C O N F I D E N T I A L SECTION 01 OF 02 SOFIA 000723 SIPDIS FOR EUR/FO/DAS STUART JONES E.O. 12958: DECL: 11/14/2018 TAGS: PREL PGOV BU SUBJECT: SCENESETTER FOR VISIT OF DAS JONES TO SOFIA, NOVEMBER 18-19 REF: SOFIA 681 Classified By: ambassador nancy mceldowney for reasons 1.4 (b) and (d). ¶1. (C) SUMMARY: Your visit to Sofia comes at a high point in our bilateral cooperation and a tough time internally for the Bulgarian government. Bulgaria has been a solid partner on key security issues, with deployments in Iraq, Afghanistan, Bosnia and Kosovo, and joint military exercises under Joint Task Force-East. It plays a positive diplomatic role on Kosovo, Macedonia and Georgia, though moving cautiously not to upset the Russians. Internally, PM Stanishev's government is under increasing pressure over corruption scandals and the misuse of EU funds, in addition to tensions among coalition members and within Stanishev's own Socialist party. The election season is underway and populist Sofia Mayor Borissov's GERB party is favored to win in June 2009; Stanishev's Socialists are fighting hard to come in a strong second. The government is looking to burnish its international and Euroatlantic credentials and has begun taking a more active role in regional security policy, most recently, its plan to announce a new Black Sea Security Strategy. This visit is an opportunity to encourage the Bulgarians to stay their constructive course in regional diplomacy, encourage them to be more proactive, and reassure them of the continuity of USG policy toward Bulgaria and the Balkans with the new administration. END SUMMARY. Solid Partner -------------- ¶2. (C) Bulgaria prides itself on being a reliable partner. It has done well by us, supporting our security and diplomatic objectives with deployments in Iraq and Afghanistan despite public disapproval (polls show over 70 percent of Bulgarians oppose deployments). Last summer we conducted joint military exercises under JTF-E (over 900 Americans and 100 Bulgarians) and started construction of permanent training facilities at Bulgarian bases. The government looks to us for advice and leadership as it undertakes military modernization, especially obtaining multi-role fighters for its aging and Russia-dependent air force. Bulgaria plays a low-key but stabilizing role in the Balkan and Black Sea regions. It supports Macedonia's NATO membership while steering clear of the name issue with Greece, favors MAP for Ukraine and Georgia (and has large arms deals with Georgia, now on hold),and supports missile defense, emphasizing the need for NATO systems that would cover Bulgaria as well. Bulgaria was in the second wave recognizing Kosovo and joined the ISG in May. It quietly but consistently encourages Belgrade to temper emotions on Kosovo and keep focused on integration with Europe. Russia Factor -------------- ¶3. (C) Though a reliable NATO and EU member, Bulgaria is also careful to keep on good terms with Russia and will not go too far in criticizing Russia's aggressive actions, as in Georgia. Unlike other former east bloc countries, Bulgaria never suffered a Soviet invasion or military occupation and Bulgarians regard the Russians as friends (70 percent approval rating v. 50 for the U.S.). More importantly, Bulgaria depends on Russia for over 70 percent of its energy. Lukoil's refinery on the Black Sea coast produces seven percent of Bulgaria's GDP and 23 percent of national tax revenues. Many Bulgarian officials resent Russia's high-handed tactics but knuckle under the pressure. Russia plays on historical and cultural ties, Bulgaria's hopes to become a regional energy transit hub, and woos with high-level meetings (eight meetings with Putin since President Parvanov took office). It also exerts influence through connections gray economy connections with business and politicians. Most major parties have some Russian connection. Energy observers suspect recent government energy contracts favorable to the Russians were part of a deal benefiting Russia-linked oligarchs and politicians. Internal Stresses -------------- ¶4. (C) With elections scheduled for June, Socialist PM Stanishev's ruling coalition is limping through its last year, hoping to be the first Socialist-led government to complete its term in office. Suffering from growing domestic and international criticism over corruption in general and misuse of EU funds in particular, the government is trying hard to convince the EU and its own skeptical public that it SOFIA 00000723 002 OF 002 is seriously tackling corruption. Tensions within the Socialist party, including between PM Stanishev and his former mentor President Parvanov, and with its two coalition partners hamper the government's maneuverability. Sofia Mayor Borissov's populist GERB party is favored to dominate the June elections and the Socialist strategy is to try to come in a strong second to gain a place in the next government. The financial crisis has not hit Bulgaria's financial system as hard as others, but will impact the real economy with reduced FDI, access to credit and lower growth. Valuing Our Advice -------------- ¶5. (C) Though internal politics are increasingly taking the government's attention, on foreign and security policy our cooperation and advice remain valued as Bulgaria looks to bolster its international and transatlantic image. Our contacts have told us Bulgaria is planning to release a new interagency Black Sea Security Strategy (reftel),and former ambassador to Washington Elena Poptodorova has been appointed special envoy for Black Sea issues. The plan reportedly conforms to our recommendations to work on improving coordination among NATO members before reaching out to all littoral states. We have steadily encouraged Bulgaria to be more assertive on regional security issues and it has been moving now on a number of these, including Kosovo, Georgia and now Black Sea security. This visit will be an opportunity to engage the Bulgarians on their view of the priorities in the Balkan and Black Sea regions, express appreciation and encouragement for the positive role they have played, and help keep their vision in line with our regional objectives. They will also want to be assured that there will be no major changes in U.S. policy toward Bulgaria with the change in administration. McEldowney