Bulgarian PM ousts ministers, vows to fight graft

Bulgaria's Prime Minister sacked the ministers of energy and justice yesterday and proposed an agency to fight fraud in an attempt to accelerate reforms in the European Union newcomer.

The Socialist-led government is under pressure to show tangible results in its efforts to curb organised crime and graft, which affects large parts of the economy, ahead of an EU report later this month on Sofia's reform progress.

Sergei Stanishev said Economy and Energy Minister Rumen Ovcharov was leaving office after he was implicated in a graft row that had eroded support for a government that took office almost two years ago.

Stanishev also dismissed Justice Minister Georgi Petkanov, who tendered his resignation earlier this week complaining of lack of funds that hindered judicial reforms.

He said the dismissals would be discussed with the two junior ruling partners and suggested there could be other changes, but did not elaborate.

Sources in the ruling parties said other personnel changes in the cabinet were very unlikely. They said the coalition was to meet early this week, most likely tomorrow, to agree on the new ministers.

Stanishev also proposed setting up a national agency on security that will combat the endemic corruption and the strong grey economy in the poor Black Sea country, which some analysts estimate at up to 40 per cent of the total.

Diplomats say crime barons, many of them former KGB-trained officers, control large parts of the economy through networks of legitimate and illegal businesses, helped by corrupt high-level officials.

Stanishev said the new agency should comprise units from the ministry of interior, defence and finance that would help the state demonstrate it can impose a strict rule of law.

The European Union has warned Sofia it may cut financial aid and refuse to recognise rulings of the Bulgarian courts if it did not comply with demands on reforms.

Stanishev said he expected a positive report from Brussels because of the government's efforts on reforms.

Analysts said the national agency could ease concerns in some EU member states that Bulgaria joined the bloc too soon, but said that a radical anti-graft agenda was still needed.