This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS SECTION 01 OF 02 SOFIA 001380 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PGOV BU
SUBJECT: BULGARIA: SIMEON'S PARTY HAS SLIM CHANCES TO FORM A 
GOVERNMENT AS TALKS WITH SOCIALISTS STALL 
 
Ref: (A) SOFIA 1134, (B) SOFIA 1325, (C) SOFIA 1363 
 
¶1. (SBU) SUMMARY: PM Simeon Saxe-Coburg's party, which 
ranked second in the June elections, is struggling to forge 
a coalition deal with the Bulgarian Socialist Party (BSP). 
However, given the deep bitterness that emerged during the 
BSP's failed attempt to form a government, talks between 
Simeon's party and the BSP appear to be going nowhere. 
Initial consultations have given way to dueling press 
statements and much of the BSP now considers the Simeon 
Movement an unacceptable partner.  Although forming a 
government from the new parliament is still possible, a 
quick ending to Bulgaria's political stalemate does not 
appear near.  If the NMSS fails to form a government, the 
President will give the third and final mandate to one of 
the remaining parliamentary groups.  There is increased 
speculation among the political class about the possibility 
of early elections in the autumn.  END SUMMARY 
 
SIMEON'S "GENEROUS OFFER" 
 
¶2.  (U) The National Movement for Simeon II (NMSS) launched 
coalition talks August 1, following the Socialists' dramatic 
failure to win parliamentary support for their minority 
cabinet the week of July 25.  The NMSS said it would seek to 
form a broad coalition government, the core of which should 
be Simeon's party and the Socialists.  However, negotiations 
between the two parties have so far consisted of little more 
than exchanging open letters.  Nevertheless, the NMSS, which 
has only 53 MPs in the 240-seat parliament, is struggling to 
woo the BSP (Ref. B).  In an effort to heal the Socialists' 
wounded pride following last week's bitter parliamentary 
defeat, the NMSS said that BSP could have the Prime 
Minister's position if it agrees to enter into a coalition. 
 
SOCIALISTS SAY NO DEAL 
 
¶3. (SBU) The Socialists are unimpressed by the NMSS's 
generosity and appear unlikely to accept a deal.  They see 
the NMSS's behavior last week as treachery and its offer 
this week as a trap aimed at further humiliating the 
Socialists.  In reply to a written offer from the NMSS, the 
Socialists on August 2 sent a letter to the NMSS consisting 
of 12 rhetorical questions, nearly all of which imply past 
perfidy on the part of the NMSS.  The Socialists say they 
will restart talks only when the NMSS answers the questions, 
which concern, inter alia, the format of the coalition, the 
policies of the future government, the name of the PM- 
designate, NMSS's position on the nationalist group Ataka, 
its position on the recent confrontation in parliament, and 
controversial financial deals sealed by the incumbent 
government.  The BSP demands that the response be sent in a 
letter, signed personally by Saxe-Coburg.  A senior BSP 
official told us that while it was not a direct rejection of 
the NMSS offer, the 12 questions were meant as a "diplomatic 
no."  The level of BSP representation during the first round 
of talks with the NMSS August 1 also indicates they are not 
seriously considering a deal with Simeon.  The Socialists 
were represented by mid-level officials while its chief 
negotiator -- deputy chairman Roumen Petkov -- was resting 
on the Black Sea coast. 
 
COMPLEX POLITICAL PUZZLE 
 
¶4. (U) The NMSS also held consultations on the formation of 
the government with the three small parties of the 
fragmented center-right and, unlike the Socialists, with 
extreme nationalist group Ataka.  Forming an NMSS-led center- 
right government, however, is not numerically possible 
without backing from either the MRF or Ataka.  The MRF has 
publicly ruled out supporting an NMSS government that 
excludes the Socialists.  On the other hand, two of the 
center-right groups say they would not enter a coalition 
which includes the Socialists. 
 
¶5. (U) There is no firm deadline for the President to ask 
the NMSS to form a government, and Simeon's party has 
indicated they will take their time holding consultations 
(Ref. A).  To avoid a humiliating scene similar to what the 
BSP suffered last week, Simeon's party said they will accept 
the seven-day mandate to form a government only after 
receiving agreement on the name of the PM-designate from 
their prospective coalition partner and securing 
parliamentary support of the proposed government line-up. 
If the NMSS is unable to put together a working coalition, 
Purvanov will task one of the other parliamentary groups to 
nominate a PM.  If that fails, the President will dissolve 
parliament, install a caretaker government, and call for new 
elections. 
 
¶6. (SBU) The President's top legal advisor told us August 3 
that Purvanov "will be forced to take a decision" if the 
NMSS is unable to come up with a PM-designate by the end of 
next week.  If, as now seems likely, the mandate to form a 
government is given to a third party, we can expect the 
process to drag on at least through the end of August before 
the President must decide whether to call new elections.  By 
law the parties and the Central Election Commission must be 
given at least two months to prepare for elections. 
 
¶7. (SBU) COMMENT:  Under the current composition of 
parliament, an NMSS/Socialist coalition remains the most 
viable and stable option.  However, given the Socialists' 
bitterness over the "humiliation" they suffered in last 
week's vote, and the complex configuration in parliament, 
the chances of Simeon's party forming a government this time 
around appear slim.  The dramatic events that accompanied 
their parliamentary defeat last week seem to have embittered 
the Socialists to the point that they are unwilling to 
seriously consider forming a coalition with the NMSS.  While 
the BSP officially says the door remains open for talks with 
Simeon's group, the message we are getting from Socialist 
contacts is that they do not trust the NMSS sufficiently to 
form a government with them. 
 
¶8. (SBU) COMMENT cont'd.  The Socialists also see a possible 
coalition deal with the ex-king's party under the current 
circumstances as a threat to the party's long-term survival. 
Just the optics of having their leader accept the 
premiership from His Royal Highness Simeon II is enough to 
make the Socialists dig in their heels.  Some Socialists 
have told us they would rather wait for the mandate to go to 
one of the small groups in parliament -- such as the MRF or 
the center-right Bulgarian People's Union -- and then try 
again to form a government.  Some NMSS insiders have also 
indicated that they see the third mandate as their best hope 
for forming a coalition with the Socialists and perhaps the 
MRF or the People's Union.  While we are primarily 
observers, we have noted to contacts on all sides our belief 
that the rapid establishment of a stable government is in 
Bulgaria's best interest.  We are also strongly discouraging 
consideration of Ataka participation in any government.  END 
COMMENT 
LEVINE