The year 2008 can hardly be described as the best year for Bulgaria's fight against crime and corruption. Several media stories alleging conflict of interest have cost the country millions in frozen European Commission funding.

The latest blow to Bulgaria's image was the Transparency International (TI) annual corruption perceptions index (CPI). This ranked Bulgaria 72nd out of 180 countries, the lowest of all European Union members. It's the first time since its inclusion in the index in 1998 that Bulgaria's standing has declined so dramatically.

To discuss why Bulgaria's image remains so tarnished, The Sofia Echo spoke to lawyer Dimitar Kumurdjiev, from the Bulgarian branch of TI and Dimitar Markov, project co-ordinator of the law programme at the Centre for the Study of Democracy.

Up and down
Kumurdjiev says: "The CPI is important because the price of bribes is included in the cost of the overall outlay foreign investors make in a country. So when corruption levels are low, money will go on actual investments.

"Bulgaria's current position is close to where it was in 2001 when it accepted an obligation as an EU candidate entrant to reform its system and reign in corruption practices. The CPI 2008 reveals the Government's complete failure to tackle corruption and a lack of political will to solve the problem."

Markov also shared some of Kumurdjiev's conclusions.

"It's worrying that Bulgaria is not only losing ground in the index but ranks last out of all EU states. This can be explained through a series of scandals in Bulgaria this year. This reflects the country's CPI position but I'm surprised about the scale of Bulgaria's slide."

Markov attributes much of this to a general feeling that there is a lack of both control and punishment in Bulgaria. "The media is always the first to report on corruption cases in Bulgaria. Then there is no progress whatsoever. Some arrests have been made but a large number of highly contentious court cases remain unresolved."

Indeed the media have helped greatly to cast light on corruption. "But this is where their role should end," Markov says. "The problem is that we don't see sentences and sanctions being served. The maximum penalty so far has been the dismissal of the official in question and nothing else. This attitude will not change until we see sentences being exacted and an active law enforcement policy against crime and corruption," he says.

Words inadequate
Both experts agree that anti-corruption rhetoric in Bulgaria is widespread. "Every party exploits the issue but this has not resulted in concrete action against corruption," Kumurdjiev says. "Bulgaria's efforts simply don't shift business perceptions of the country's corruption environment. Hence we have even dropped down the CPI. Yes, Italy and Germany have gone down as well but last year they shot up." And this is why the CPI is important for Bulgaria, Kumurdjiev says, "because it shows how Bulgaria is seen through foreign investors' eyes".

Furthermore, with the world entering recession, competition in attracting investment will become intense, he says. "It's logical that investors will choose countries that have a high CPI index," he says.

In Cyprus corporate income tax is the same as in Bulgaria but the CPI is higher. So, the better the index, the greater the chance of attracting investment," he says.

A vicious circle
"In 2001 we did a survey on conflict of interest. We said that once privatisation is over the main arena for corrupt activities would become public tenders," Kumurdjiev says.

"Today this has become a fact. The Trakia highway concession, which we noted back in 2005 had been granted without a public tender in contravention of any EU legislation, now creates serious concerns about corruption."

His concern does not relate to the way public tenders are being handled because this complies with the law. "The problem is that, in many cases, tenders are organised in such a way that they favour a certain company and so afford it a privileged position. This is the problem. Hence, when investigators decide to check a tender, it seems perfectly fine from a legal point of view and nothing happens. It's a vicious circle."

All this has resulted in strong EU pressure for amendments to the Public Tenders Act. "We need transparency in the way tender conditions are being set. Outside experts should also take part in the selection procedure. These experts should not work at the respective body organising the tender because a ministry employee could risk his job if he tries to assume an independent stance on a certain issue," Kumurdjiev says.

Responsibility
A major problem in Bulgaria's fight against corruption, according to Markov, is the lack of political responsibility. "Firstly, those involved in corruption scandals should have a sense of honour and leave their posts. In fact, the phrase `political responsibility' in Bulgaria has a shallow meaning; it means nothing, just dust thrown in society's eyes. Everybody is hiding behind this phrase but no one wants to take responsibility for wrongful actions."

The difference between the law and its enforcement is also a serious issue, he says. "We saw how the National Audit Office published a list of the names of public officials who had discrepancies in their income declarations. The General-Prosecutor's Office said they were going to do something about it, but, in the end, nothing happened."

This raises the question of the efficiency of Bulgaria's judiciary, especially in light of the highly negative World Bank report published in October this year.
"It appears that the ball is in the court of the judiciary, which is the highest paid public sector in Bulgaria," Markov says.

"Compared to other sectors their salaries are very high. Unfortunately, the judiciary also suffers from probity problems because we keep on reading about corrupt magistrates and, again, nothing happens. There seems to be a lack of desire within the judiciary to be active against corruption. And the law provides all the power it needs to be efficient, so magistrates have no room for excuses."

According to Kumurdjiev, the police are also culpable for the current situation. "It's obvious that evidence is not good enough, since we have people released on bail who should be in prison. Special units should focus on corruption because there is a lack of expertise on the part of police and prosecutors."

This is where Markov and Kumurdjiev differ.

A year-and-a-half ago, the State Agency for National Security (SANS) was created with the main purpose of fighting top-level corruption. "To some extent, SANS's creation was a response to the Interior Ministry's serious problems and scandals. So today we see that the new body has the same problems. This was to be expected because a large number of SANS's employees came from the Interior Ministry. This means that creating new bodies is not going to solve the problem," Markov says.

Markov believes in boosting the capacity of existing bodies as well as spending more money on staff training and transparent mechanisms for sanctions. "People who have been exposed should not remain in the system. Nothing else will work because fear is a very reliable factor in corruption prevention."

The EU role
Some claim that Bulgaria was more responsive to EU criticism when the country was an EU candidate-member. Not so Markov. "I wouldn't say that the EU's pressure on Bulgaria is weaker today. It's the instruments of pressure that have changed," Markov says. "Before 2007, it was about threatening postponement of EU membership. Now we have the freezing of EU funds. To me this does not represent a softer sanction. Without EU funds, the Government cannot fulfil its programme. This will undermine its popularity. Furthermore, without the EU money the Government cannot pay back businessmen who have done it a service. So in the end, the lack of money will mean less support for the Government, which might, in turn, lead to a change in power," he says.

Kumurdjiev cites other South Eastern European countries that have shared some of Bulgaria's difficulties as EU candidates. "The Czech Republic, Poland and even Turkey managed to create intolerance to corruption. They had high-profile officials arrested and sentenced and these steps produced results." These countries integrated anti-corruption measures into their government policy, something that Bulgaria has failed to emulate. "Sadly, Bulgaria is an exception. We have managed to harmonise our legislation, reaping praise for this, but with little results."

Not an isolated case
Bulgaria, however, was not an isolated case, Markov says, explaining that Italy and Greece are also on the list, but it is Bulgaria that has been branded a corrupt country.

"The EU has a different approach for each country, and Bulgaria is a small country that has recently joined the Union." Markov says. "We need to keep away from Bulgaria becoming a smaller version of Italy in the EU."

What lies ahead?
As someone working for an NGO, Markov has something to say about the Bulgarian Government's responsiveness to accusations of corruption. "The Government simply does not take seriously what the NGO sector says about crime and corruption. It's as if it doesn't count unless it stems from the EU. If the EC repeats the TI findings, then you will see a different response by the Government. It depends where the message comes from."

Kumurdjiev also agrees with that view: "After the release of the CPI we have had just one invitation by Meglena Plougchieva, Deputy Prime Minister for EU Funds, to attend a conference on EU funds' embezzlement. Besides that we have had no reaction from the Government whatsoever. We have had no dialogue so far and no idea what the Government plans to do".

Kumurdjiev awaits the next EC interim report on Bulgaria's readiness to fight organised crime and corruption, due by the end of the year. EC spokesperson Mark Grey already said that the EC would consider the TI ranking and Bulgaria's place in it.

"We don't want to criticise Bulgaria. We merely wish to inform the public about the country's problems and start a discussion. In the absence of such a discussion the next EC report will share some of the TI findings. In the long-term this will mean a safeguard clause imposed on Bulgaria."