Bulgaria Has a Second real Reform Chance Message from the Co-Chairs Robert L. Barry and Hugh Kenneth Hill Because of his increasingly busy international travel schedule, BAS Chairman Tom Gibson resigned in mid-1996, through he remains active in the Society as a director and treasurer. We, as recently retired former Ambassadors (R.L. Barry 1981-84 and H.K. Hill 1991-94) with a continuing interest in Bulgaria, were approached by the Board and offered our services as co-chairs. We believe that our differing schedules and previous experiences at working together in Sofia and elsewhere in the State Department, meant that we could contribute more that way than as Chairman and Vice-Chairman. We took over an active organization with a distinguished Board and a record of accomplishment, determined to keep the organization actively involved in support of economic and political reform in Bulgaria. During the months since we joined the BAS, events in Bulgaria have swung widely, and the BAS has tried to stay ahead of the curve. Initially, the failed policies of the Videnov Socialist government created havoc with the country’s economy, driving away potential foreign investors and creating runaway inflation. Then the election of a new pro-reform President, Peter Stoyanov, was followed by a remarkable demonstration of “people power” in the streets, which forced the calling of new elections and the appointment of a new interim government devoted to the pursuit of democracy, market economy, and membership in NATO. The April 19 elections produced the predicted majority for the pro-reform UDF Coalition and a government was formed to take over form the caretakers. Agreement has already been reached in principle on a variety of steps needed to rescue Bulgaria from the wreckage of its economy: an internationally-supervised currency board to arrest inflation and bring the budget under control; credits from the international financial institutions to promote reform; privatization and the liquidation of loss-producing state enterprises; and the adoption of new policies designed to encourage private enterprise and foreign direct investment. As we wrote in an op-ed piece in the Washington Times of March 25, Bulgaria has a second chance at real reform and democracy and we in the West need to support and encourage them in any way possible. During the past winter, our focus was on humanitarian assistance to alleviate the hardships brought about by the failed policies of the Videnov government. We worked with the Sate Department, USAID, and U.S. NGOs to provide assistance, concentrating on pharmaceuticals and emergency grain supplies. Board member and former Ambassador Jack Perry’s letter, published in a number of newspapers, elicited voluntary contributions, as did a BAS and American University in Bulgaria sponsored concert by young Bulgarian musicians held in Washington in March. Board members Meryl Steigman and former Ambassador Sol Polansky spearheaded this effort, in close consultation with Ambassador Bohlen in Sofia. In addition. Ken and yvonne Hill arranged a similar concert in Gettysburg which derw an enthusiastic audience. We are seeking to expand the Society’s membership by encouraging those interested to join, for an annual membership fee of $35 ($10 for students). Members will be kept informed of the Society’s activities and will be invited to cultural events and meetings with visiting Bulgarians as the occasion arises. We are particularly eager to reach out to Bulgarian youth in Bulgaria and abroad through the Internet. Our new Executive Director, Irina Petrova (ipetrova@astd.org or fax: (703) 548-2383) is the Web site editor and will gratefully accept ideas and contributions. Support for Bulgarian NGOs is a continuing priority for the Society. Board members Walt Raymond and Stanimir Alexandrov have been in touch with Bulgarian NGOs about their priorities. We have been able to answer a request for training in internal management and financial planning, and we are working on a project to support Internet communications between Bulgarian NGOs and their counterparts in the US and neighboring countries in Southeast Europe. Looking to the future, we think it important to make American business aware of the new opportunities in Bulgaria as the new government pursues its reform agenda. We have been successful in our efforts to include Bulgaria in a trade mission headed by the Secretary of Commerce next fall. We hope U.S. business will participate and encourage Bulgarians to properly prepare for the visit. The new Bulgarian government has staked a great deal on joining an expanded NATO, and has asked the Society to help. While we do not think it possible to include Bulgaria in the first round of NATO expansion, we do think it important that the door be kept open for Bulgaria in the future. To this end, we have written to members of Congress and pointed out publicly (in the March 25 Washington Times op-ed) that the possibility of future NATO membership will provide needed encouragement to Bulgarian reformers. The Society continues to meet with visiting Bulgarians and assist in providing forums for them to meet with interested Americans. This year we have met with visiting delegations of the UDF and the Euro-Left, with UDF leader and future Prime Minister Ivan Kostov, with visiting businessmen and the President of the Atlantic Club, and with others. We have co-sponsored with CSIS a forum for the new Bulgarian Foreign Minister. BAS Boardmembers such as Richard Rahn, Sol Polansky, Mark Bloomfield and others have discussed BAS priorities and programs during their visits to Bulgaria. We have welcomed a number of new Boardmembers during the past year, and formed a new Executive Board. New members include Margo Machol, President, Chesapeake Associates, Professor Patrick Lecacque of Southeastern Missouri University, Norman Anderson, Ambassador, retired, Rudolph Penner, the Barents Group. The Executive Board is made up of the Co-Chairs, Vice-Chairs Tom Kahn and Mark Bloomfield, Treasured Tom Gibson an Executive Director Irina Petrova. We facea challenge in responding to rapid change in Bulgaria. Please help us meet it. Cultural Events Hugh Kenneth Hill Promotion of Bulgarian-American cultural exchanges is one of the key elements of the Society’s mission statement and one that has been active recently. On March 6, in cooperation with the American University in Bulgaria (AUBG), the Society organized a concert by three terrific young Bulgarian musicians at the World Bank auditorium in Washington. The musicians, cellist Diliana Momtchilova, pianist, Anna Stoitcheva, and violinist Georgy Valtchev, are studying music at the Juilliard School in New York. They delighted the audience of several hundred persons, including Bulgarian Ambassador Snezhana Botusharova and Dr. Peter Fischer-Appelt, the President of Sts. Cyril and Methodius Foundation, with their masterful performance of works by Beethoven, Debussy, Prokofiev, Scriabin, and U.S. premieres of compositions by the Bulgarian composers Christokov and Vladigerov. After the concert, guests were invited to a reception arranged by the Bulgarian Embassy. Members of the Society provided overnight accommodations for the musicians. Donations at the door and additional donations by those who attended the concert raised $2,770 which the Society asked AUBG to turn over to a regional hospital in Blagoevgrad. On March 7, the musicians traveled to Gettysburg, PA, and presented a second concert. This concert was organized by the Music Gettysburg programs at the Lutheran Theological Seminary and by the Adams County Arts Council, in cooperation with the BAS. The Seminary was host to a reception following the concert to which local Bulgarian-Americans, Bulgarian students at Gettysburg College and Mount Saint Mary’s College , as well as professors and music activists were invited. The musicians were taken on a brief tour of the Gettysburg Battlefield and were accommodated in the homes of Society members and the family of a former Fulbright student in Bulgaria. After the Gettysburg concert, cellist Diliana Momtchilova took part in the Friday Morning Concert Competition in Washington, in which she took first prize! Humanitarian Assistance Efforts of the BAS by Meryl Steigman As the reader probably knows, the Bulgarian economy all but collapsed during the past winter. Hyper-inflation created a situation in which the lev was virtually worthless. Anyone on a fixed income saw his or her purchasing power shrink to practically zero. There were severe shortages of basic foodstuffs such as bread and vegetables. Hospitals quickly discovered that government allocations did not cover escalaring costs of pharmaceuticals. Indeed, by early January, many hospitals were without such basics as latex gloves, soap, anasthesia, syringes, and even minimal types of pain relievers. BAS Board members received fax and e-mail communications that told of people in desperate need of antibiotics, of surgery that had to be postponed because there was no anasthesia, of emergency-room patiens who went untreated because there was no medication available to help them. As an American, it is difficult to even imagine such a crisis. The Society moved quickly to determine how we could help in this critical situation. We were in touch with numerous humanitarian organizations including religious groups, medical relief teams, food-assistance organizaions, and government agencies. We learned that Project Hope had a grant from USAID to assess the medical-needs situation in Bulgaria. Project Hope had not only assessed the catastrphe, its members arranged for shipment of more than $2 million worth of medical supplies and pharmaceuticals. We met ferquently with physicians and other professionals from this organization and gave them useful lists of hospitals and people to visist while in Bulgaria. Although the winter crisis is over, the situation is far form rosy. One of our Board members this week received and e-mail from a Bulgarain psychiatrist describing how lack of proper drug therapy has caused a number of out-patients to become hospitalized. At the same time, hispotals have closed downwhole wing. The psychiatrist detailed the many kinds of drugs urgently needed: neuroleptics, antidepressants, mood stabilizers, and anti-convulsans. "Ideally, the municicpality should pay for their treatment," she wrote, "as it gets money for that from the budget, but the hyper-inflation is such that the money far from enough to cover even the most urgent health needs." The humanitaian crisis continues in Bulgaria. Please, help us provide antibiotics, pain relief drugs, and other pharmaceuticals, soap, latex gloves, syringes, and all the other medical supplies Americans take for granted. All donations to the Society are tax deductible and all donations are used to help the Bulgarian people. The needs are critical, and you can make a difference in someone's life. Contributions checks may be made out to BAS and sent to: 1020 16th Street, NW, Suite 200 Washington, DC 20036 Thank you. Work With Bulgarian NGOs by Walter Raymond The BAS has maintained a continuing interest in assisting Bulgarian Non-Governmental Organizations develop and fill an increasingly important role in Bulgarian Society. We contacted several Bulgarian think tanks and sought their views as to the specific needs faced by NGOs in the counrty. A series of meetings was held in Sofia and two particular needs were identified as a result of these consultations as having a potential positive impact on the development of civil society in the country. The two needs that the Bulgarian group identified were: the need to improve internal management and financial control of NGOs in order to enhance their self-sustainability and institutional capacity, and the facilitation of access to information resources, particularly Internet. BAS contacted the Institute of Sustainable Communities (ISC) which is a major AID grant recipient with the explicit responsibility for supporting and strengthening emerging Bulgarian NGOs. The ISC has expressed interest in assisting in this area. Access to information resources is the subject of on-going discusiions. Our initial review of this issue suggests that it could be approached on two levels: regionally and nationally. A regional network of informational and communications systems that would help lower barriers, increase understanding and foster cooperation in the Balkans. Such an intiative is consistent with the recently launched Southeast Europe Cooperative Institute (SECI) which involves all countries in the region, including Bulgaria’s neighbors Greece, Turkey, Macedonia, and Rumania. Prime Minister Ivan Kostov has strongly endorsed the SECI initiative and cites it as an important element of Bulgaria’ regional policy. He adds that mobilizing external and internal regional sources of financing major infrastructure projects would change the appearance of Southeast Europe, would increase its attractiveness for international business and heighten prospects for tranquil political relationships. In this regard, the Society is prepared to help in any way it can to facilitate international communications networks in the region. At the same time, we would encourage telecommunications companies entering the area to provide assistance to NGOs so that they may gain access to Internet. The Society has also participated in meetings in Washington which have weighted various ways to support Bulgarian NGOs. The key now is to strengthen networking between U.S. NGOs and Bulgarian counterparts The Society is prepared to use its extensive connections with Bulgarian NGOs to help American NGOs to find worthy counterparts. We believe one-on-one paring can provide the most effective goals-oriented relationship. We encourage readers of this newsletter to help. Please, contact the Society with your suggestions and expressions of interest. Bulgarian-American Education Cooperation by Sol Polansky On May 24, 1997, the American College of Sofia graduated its first class since 1942. At that time, the American College of Sofia, which traced its roots to two schools founded in Bulgaria in the 1860s by American missionaries and educated many of Bulgaria's professional circles, was forced to close by the Bulgarian Government. Following the end of World War ll, the Bulgarian Communist regime expropriated the College's campus and facilities, converting them to a specialized training center of the Ministry the Interior and the secret police. With the fall of the Berlin Wall and the beginnings of change in Eastern Europe, Bulgarians in Sofia used the occasion of the April 1990 Earth Day to launch a petition calling for the reestablishment of the American College of Sofia. More than 5,000 people signed the petition. On September 15,1992, the College welcomed 50 boys and 50 girls, exceptionally gifted students, who were prepared to demonstrate their trust in the historic reputation and mission of the College. The students were selected solely on the basis of academic merit from among 3,000 7th graders who vied for the 100 places. Each year since then, the College has admitted 100 boys and girls on the same basis, and is now fully operational with 500 gifted students whose families represent all walks of life and all regions of Bulgaria. Among the student body are some 20 international students. The College's academic faculty numbers 63, including 17 Americans. The achievements of the College’s first graduating class are most impressive. The average SAT scores were 1364 and, as of this writing, 42 students have been accepted at 57 colleges and universitites, including the American University in Bulgaria, in the U.S. and Europe. These students have been awarded scholarships and financial assistance in the amount of $538,000 per year. Other achievements of College students include a first and third place in a Knowledge Bowl competition involving nine teams from Vienna, Moscow, Istanbul, Bucarest, and Warsaw. On May 4, the American University in Bulgaria in Blagoevgrad held its third annual graduation. Established in 1991 as a Bulgarian -American initiative, AUBG provides a traditional American Liberal Arts undergraduate education, preparing its students to meet the challenges of the 21st century. Major concentrations of study include applied economics, business administration, journalism/mass communications, history, philosophy, and Southeast European Studies. AUBG's mission statement includes the development of the University as a regional institution, meeting needs of the region.Toward this goal, aproximately 20 percent of the current student body come from countires of the region, including Yugoslavia, Romania, Albania and also from countries of the former Soviet Union. At this year's graduation, the student speaker, chosen by her mostly Bulgarian classmates, was from Albania,the Presidential medal winner was from Serbia, the Valedictorian from Bulgaria, and two of the three Salutatorians were from Romania and Poland. As part of its focus on the Balkans, AUBG has established a Southeast European Studies Center which includes an Interdisciplinary Policy Studies Program. This program has a four week summer program, from July 14 to August 8, titled "The Dayton Accords:Continuity or Change in Southeast Europe,” involving approximately 25-30 students from Bulgaria, Turkey, Romania, the US. AUBGfaculty will participate along with Dayton-focused academicians, policy experts and policy makers from Bulgaria, Turkey, Greece, and Western Europe. The second and third phases of the project will focus on NATO expansion and Southeast Europe (1998-99) and European Integration and Southeast Europe (1999-2000). The American College of Sofia and the AmericAn University in Bulgaria are private, independent institutions making a significant contribution to Bulgaria's education system andprovide significant financial assistance to their students. The College and AUBG have been operating in a changing environment and grappling with a number of problems many new institutions face. If you are interested in learning more about and assisting the College and AUBG, please feel free to write to the American University in Bulgaria,US Office for Development and University Relations, 1725 K Street NW, Suite 411, Wasington, DC 20006-1401, or the American Colle4ge of Sofia, New York Office, 850 Third Ave., 18th Floor, New York, NY 10022. US Business and Bulgaria Robert L. Barry American businessmen have never flocked to Bulgaria. When I was Ambassador in Sofia in the early 1980s, the overwhelming bulk of Bulgarian trade was with the USSR. In a reflective mood once, President Zhivkov confessed to an American Congressmember that he could not afford to become an ally of the U.S. because Americans would never subsidize the Bulgarian economy the way the Russians were. Indeed with the collapse of the USSR and Bulgaria’s trade with Russia, Bulgaria was left with a number of stranded investments, such as refineries built to use Russian oil sold at below market prices, steel mills based on outmoded technology, all fo which contributed to the collapse of the Bulgarian economy. With the coming to power of the UDF, American businessmen came to Bulgaria as to the rest of post-communist Eastern Europe to see if there were in fact opportunities for direct investment. The US Government, the European Union and the international financial institutions preached the gospel of shock therapy and told the newly elected parliament and government that the introduction of free market policies would attract foreign direct investment, which would play a much more important role over time than foreign aid. However the new policies were slow in coming, and US business found that despite their rhetoric, the new government was taking only minimal steps to encourage investment. Disappointment with the lack of results from the UDF led to the victory of the Bulgarian Socialist Party in the parliamentary elections of 1994 and a BSP government led by Prime Minister Zhan Videnov. The combination of communist era policies toward private business and widespread corruption caused those American businesses which were trying to develop ties with Bulgaria to withdraw. In 1996, the BAS held a conference for businessmen and government officials interested in Bulgaria, but there was little follow-up from the Bulgarian side. This year has seen the economic collapse of Bulgaria due to the failed policies of the BSP and the resignation of the Videnov government in the face of continued street demonstrations. An interim government led by Sofia Mayor Sofiansky and made up of pro-reform experts got Bulgaria back on the path of market reforms and currency stabilization. The April elections returned a strong UDF majority and the new government led by Prime Minister Kostov has pledged to carry through with the economic reforms which they called for in the election campaign. This means a stable currency overseen by an internationally supervised currency board, a restructured banking system, large scale privatization and the liquidation of stranded government firms, and the introduction of legal and policy reforms needed to attract foreign direct investment. We think it is time for US business to have a new look at Bulgaria. We are convinced that this time the UDF and its allies will welcome foreign investments and make the necessary market reforms. There are many opportunities created by Bulgaria’s strategic location at the crossroads of Europe and Asia, and by its well educated work force. German and Russian businessmen have been announcing important deals and looking closely at strategic alliances in the telecommunications, transport, energy, and media sectors. The U.S. enjoys a competitive advantage given the vigor of its economy, the superiority of its technology, and the Bulgarian desire to diversify so that too much of its economy does not end up in German or Russian hands. The Society has successfully argued for Bulgaria’s inclusion in a trade mission which the Department of Commerce is organizing during the period October 6-12, 1997. The mission will also visit Romania, Slovenia and Croatia. Recruitment for the Mission is centered on our embassies in the four capitals, so that Ambassador Bohlen and Senior Commercial Officer Susan Widener will lead the effort for Bulgaria. The Society would like to assist by contacting businesses here in the U.S. and arranging meetings and briefings when Bulgarian officials involved in trade and investment come to Washington. We will also try to reinforce the need to carry through with reforms and create a favorable climate for investment, and to make sure that a productive set of meetings is arranged for participants in the October trade mission. Over the longer term, the Society’s business agenda calls for cooperation with the Southeast Europe Cooperative Initiative (SECI), a U.S.-led effort to foster cooperation among the countries of the region to solve common problems. We are particularly interested in opportunities created for cooperation among Greece, Turkey, Bulgaria, and Romania in areas such as land transport, energy, and telecommunications which should create larger markets and investment opportunities for U.S. companies. Bulgaria and Romania are both candidates for NATO and European Union membership and want to tie themselves firmly to the institutions of the West. We urge the US business community to seize this opportunity, and we stand ready to help in any way possible.