US embassy cable - 05SOFIA1429

UNCLAS SOFIA 001429 
 
SIPDIS 
 
SENSITIVE 
 
E.O. 12958: N/A 
TAGS: PGOV, BU 
SUBJECT: BULGARIA: AS SIMEON'S PARTY FAILS TO FORM 
GOVERNMENT, PARTIES BRACE FOR LAST-CHANCE TALKS 
 
Ref: (A) SOFIA 1134, (B) SOFIA 1325, (C) SOFIA 1363, (D) 
 
SOFIA 1380, (E) SOFIA 1404 
 
1. (SBU) SUMMARY: PM Simeon Saxe-Coburg's party August 11 
abandoned its attempt to form a government after failing to 
strike a coalition deal with the Bulgarian Socialist Party 
(BSP).  The two parties have been at odds over forming a 
cabinet since the Socialists won the June general elections 
but failed to gain a clear majority.  President Georgi 
Purvanov now must hand the third and final mandate to form a 
government to one of the smaller parties.  The Socialists 
have indicated that they support a four-way coalition with 
the NMSS and two small parties.  Insiders from both groups 
told us they were optimistic that they will be able to form 
a government relatively quickly this time around.  Failure 
of this third attempt will force new elections in the fall. 
END SUMMARY 
 
2.  (SBU) President Purvanov now has a week to task one of 
the remaining parliamentary groups to nominate a PM and try 
to form a government (Ref. A).  The mandate is expected to 
go to either the ethnic-Turkish Movement for Rights and 
Freedoms (MRF) or the small center-right Bulgarian People's 
Union (BPU), both of which have indicated they would back a 
BSP-led government. 
 
3. (SBU) The Socialists are working to forge a four-party 
coalition with their MRF allies, the NMSS, and the BPU. 
Socialist leader Sergei Stanishev, who remains the BSP's PM 
nominee, said Bulgaria may have a new government as early as 
next week.  Insiders from both the BSP and the NMSS also 
appeared optimistic, saying that since the two largest 
parties have each blocked the other's attempt to form a 
government, the third mandate will be characterized by 
pragmatism rather than posturing.  A senior BSP official 
told us the leaders of the four parties were scheduled to 
meet late on August 12 to discuss a coalition agreement. 
Many things can still go wrong, but party leaders told us 
they hope to reach agreement over the weekend on a coalition 
platform and distribution of ministerial positions.  If they 
succeed, the vote in parliament could take place as early as 
next Wednesday, according to these sources. 
 
4. (SBU) A four-party government would control 182 of 
parliament's 240 seats, more than the two-thirds majority 
required to pass constitutional amendments needed to meet EU 
requirements.  If a deal with Simeon's party fails, the 
Socialists will try to form a government with the MRF and 
the BPU, which would be less stable and enjoy narrow public 
support, but would still have a majority of some 129 seats. 
If the third attempt to form a government fails, the 
President will dissolve parliament, install a caretaker 
government, and call new elections for the autumn. President 
Purvanov has urged parties to agree to a deal and quickly 
form a government (Ref. E). 
 
5. (SBU) COMMENT:  Public cynicism is high in the wake of 
the outgoing government's dithering response to widespread 
flooding (ref E).  Many already accuse the politicians of 
fiddling while Rome burns, and further delay in forming a 
government could well result in postponement of Bulgaria's 
EU membership.  The outcome of potential new elections is 
anybody's guess, but the consensus seems to be that they 
would not resolve the current political impasse, and could 
worsen the situation by bringing in more members of the 
extreme nationalist Ataka party.  Fearing that another 
election cycle would further erode public faith in the 
political class, the major parties appeared determined to 
use this last chance to form a government.  Although party 
leaders are optimistic at this point, the experience of the 
past month has shown that deals can fall apart in the 
eleventh hour.  END COMMENT 
LEVINE