VZCZCXRO2432
RR RUEHFL RUEHKW RUEHLA RUEHROV RUEHSR
DE RUEHSF #0532/01 2170920
ZNY CCCCC ZZH
R 040920Z AUG 08
FM AMEMBASSY SOFIA
TO RUEHC/SECSTATE WASHDC 5298
INFO RUEHZL/EUROPEAN POLITICAL COLLECTIVE

C O N F I D E N T I A L SECTION 01 OF 02 SOFIA 000532 
 
SIPDIS 
 
E.O. 12958: DECL: 07/31/2018 
TAGS: PGOV PCOR ECON BU
SUBJECT: GOVERNMENT FACES HOT AUTUMN AFTER DEFEATING 
NO-CONFIDENCE VOTE 
 
REF: A. (A) SOFIA 499 
     ¶B. (B) SOFIA 485 
 
Classified By: charge alexander karagiannis for reasons 1.4 (b) and (d) 
. 
 
¶1.  (SBU)  SUMMARY:  PM Stanishev's government on July 30 
easily defeated (150/84) the no-confidence vote called over 
the critical July 23 EU monitoring report and loss of EU 
funds.  Though the motion failed to shake ruling coalition 
unity or trigger cabinet changes, the government remains 
pressed by growing criticism at home and abroad and 
tensions within the coalition.  Opposition leaders, 
energized by the EU report, are discussing coordinated 
efforts for when parliament returns and the budget season 
begins in September.  Despite the coalition's majority in 
parliament, they hope social protests, strikes, walkouts 
and demonstrations will put enough strain on the government 
and coalition unity to force early elections.  The PM's 
challenge is to keep the coalition together while 
demonstrating to the public his government can effectively 
address the EU's concerns.  END SUMMARY 
 
THE VOTE 
-------- 
 
¶2.  (U)  The center-right opposition brought the 
no-confidence motion following the July 23 release of the 
European Commission monitoring report, which blasted 
Bulgaria on the rule of law and mismanagement of EU 
funds (Refs A and B).  The motion cited "incurred moral 
and material damages to the country and its citizens 
because of the inappropriate absorption of the EU funds." 
All four small center-right opposition groups and extreme 
nationalist party Ataka backed the motion.  In the 
seven-hour parliamentary debate preceding the vote, 
center-right MPs blasted the cabinet for inflicting huge 
losses on the Bulgarian economy, undermining investor 
confidence, and shaming Bulgaria before the world.  Ruling 
coalition MPs struck back by saying the center-right had 
little credibility to talk about corruption, given the 
track record of the 1997-2001 center-right government, and 
accused Ataka and Mayor Borissov,s GERB of instigating 
social tension. 
 
GOVERNMENT RESPONSE 
------------------- 
 
¶3.  (SBU)  At its council meeting July 26-27, the ruling 
coalition mapped out measures to address Brussels' 
criticism.  The three parties agreed to strengthen the 
controlling powers of the newly-appointed Deputy Prime 
Minister for EU affairs, Meglena Plugchieva, and further 
centralize management of EU funds by creating a new 
government agency to deal with EU money.  In a move to 
regain public support, the coalition also approved an 
increase of the monthly minimum wage and a new pension 
raise in October. 
 
¶4.  (U)  In a speech to Parliament following the vote, PM 
Stanishev vowed to step up reforms and boost control.  He 
also said he expected "certain political and economic 
circles" to instigate social unrest in the fall, which 
combined with a new no-confidence vote would aim to bring 
down the government.  The PM pointed the finger at GERB and 
Ataka, accusing them of inspiring street protests, and 
urged the center-right parties not to take part in such 
scenarios.  Bulgaria needed stability to unlock suspended 
EU funding, he said, and early elections would destabilize 
the country and lead to further losses of EU assistance. 
 
GATHERING CLOUDS 
---------------- 
 
¶5.  (SBU)  Our contacts predict a politically hot autumn as 
the parliamentary opposition and GERB hammer away 
at the ruling coalition.  Ataka has already walked out of 
Parliament, demanding early elections.  The center-right 
parties, striving to energize and expand their base, are 
talking with trade unions about joint protests during the 
parliamentary budget debates this fall.  GERB, though not 
represented in parliament, will add its political strength 
to protest actions.  Some GERB leaders are concerned that 
the party's popularity is peaking and so are pushing for 
elections 
as soon as possible.  It is too early to predict how well 
the various opposition groups will cooperate with each 
other, especially given the egos involved, but enthusiasm 
is running high across the board. 
 
¶6.  (SBU)  The PM will also have to manage internal 
tensions in the coalition.  Ex-king Simeon's National 
 
SOFIA 00000532  002 OF 002 
 
 
Movement for Simeon II (NMSS) is the coalition's weak 
link.  With popularity ratings under two percent, some NMSS 
officials believe breaking away from the unpopular 
government and early elections would improve their 
prospects at the polls.  Stanishev must also parry attacks 
from his leftist BSP foes ahead of the party conference in 
November.  Ongoing public tension between the PM and 
President Georgi Parvanov, his former mentor, add to the 
growing sense of political instability. 
 
COMMENT 
------- 
 
¶7.  (C)  In addition to the escalation of political tension 
over the past few months, social unrest, stepped-up 
opposition demands for early elections and internal 
coalition tension could pose serious challenges for the 
government this fall.  Many of our contacts expect 
Stanishev to play it safe and focus on maintaining 
stability within his party and the coalition, and refrain 
from any possibly destabilizing moves.  A key test this 
autumn will be the debates in Parliament on next year's 
budget.  If the coalition passes this test united, it will 
likely get through to the end of its term.  But even if 
it survives, the government risks becoming inward looking if 
the PM focuses only on his internal balancing act and not 
on improving government performance to address the issues 
raised by the EU. 
Karagiannis