Back in early June Bulgaria suspended work on the South Stream gas pipeline, followed abruptly a few days later by Serbia. Bulgarian Prime Minister Plamen Oresharski argued that the project had to be frozen so the country could meet EU regulations. But parliamentary speaker Mihail Mikov denied that the Bulgarian part might be halted for the time being, arguing that Oresharski did not have the powers to issue such orders. When asked why he made his statement immediately upon meeting three US senators on Sunday, Oresharski denied the two events were connected. He stated that the European Commission’s concerns were mainly about the procedures selecting South Stream Bulgaria to operate and own the pipeline, Bulgaria’s competence to conclude the inter-government agreement, and the public tenders awarded.
In layman’s terms, it was frozen until it meets the EU’s competition and energy liberalization requirements. The site of Bulgarian financial and political weekly Kapital wrote on 21 June that “the tender for building the gas pipeline was arranged in such a way that the contract could be awarded to companies close to Russian President Putin and Delyan Peevski, media mogul and MP of the DPS”. Neither was the EU said to be keen on the monopoly element: Russian gas in a Russian pipeline. It is obvious bureaucratic procedures will drag on, right up to the completion of the European Commission’s anti-trust inquiry. One of the three senators mentioned above, firebrand John McCain, said “We wanted less Russian involvement in South Stream”, when commenting on the talks with the Bulgarian premier.
But what’s in it for ordinary Bulgarians? The project is splitting Bulgarian society, with the north set to gain in terms of jobs but the rest of the country missing out and environmentalists fighting it tooth and nail. On the plus side, the South Stream would give the entire EU direct access to gas without intermediaries. The country’s politicians are divided, while others seem tied to it through personal gain. And for Bulgaria, the country that joined the European Union in January 2007, the project to take Russian gas through into Central Europe via several Southern European countries to at least Austria is pitting Bulgaria’s EU future against its past as a nation with close ties to Russia, which used to unofficially and jokingly be called the 16th republic of the USSR. And, oh, the biggest winner would be Russia.
Let’s look at the context of the project. It would actually lead to no diversification of Bulgaria’s sources of natural gas. Though gas supplies would be more secure, energy independence would increase. South Stream and Nord Stream are bypassing Ukraine and Belarus taken together, crossing out the significance of Ukraine’s gas-transportation system. That is the basic idea. At summits of EU leaders Bulgaria has consistently opposed a third wave of sanctions against Russia over its grabbing of Crimea. The European Parliament voted a resolution against the construction of South Stream on April 17 and called for EU measures against Russian firms and their subsidiaries, especially in the energy sector, and Russia’s EU assets, against the ongoing background of violence by Russia, supplying arms, advisers and terrorists, all designed to destabilize the east and south of Ukraine.
But clearly this is no pipe of peace in Bulgaria; witness the fight behind the scenes. There is a plot to make Boyko Borisov, leader of the Citizens for Bulgaria’s European Development (GERB Party), premier again. A plot by Putin, no less. So says Nikolay Barekov, leader of Bulgaria Without Censorship. He said that if Borisov returns to power he will seize the local business world and that GERB and the Bulgarian Socialist Party would collude. “Boyko Borisov will continue to construct the ‘South Stream’ gas pipeline. His companies, as well as the companies of the Movement for Rights and Freedoms (DPS) and Bulgarian Socialist Party (BSP) will continue to work on this project”.
Furthermore, Bulgaria’s Reformist Bloc, an alliance of democratic parties, says it has evidence about a secret agreement between Bulgaria and Gazprom on South Stream said to have been signed at the end of May. It also claimed a supplementary financial deal contained unfavourable interest rates for Bulgaria.
Nearby Ukraine is rightfully upset over what it regards as Europe’s democratic credentials, or rather lack of them. The country’s foreign ministry expressed indignation after Putin visited Vienna on 24 June to discuss South Stream. Ukrainian Deputy Foreign Minister Danylo Lubkivsky, no doubt with Russia’s annexation of Crimea in mind, said: “Does this mean that the European position, the position of democracy, protection of the fundamental principles of international law is no longer relevant?” Putin had further stoked the war of words on the pipeline’s future by saying the US wanted to supply its gas to Europe, so naturally opposed it. He denied that the aim of the North and South Stream projects was to bypass Ukraine and (thereby) take it out of the Europe gas supply equation. But South Stream is likely to go ahead. Bulgarian Foreign Minister Kristian Vigenin said so on 21 June. But what is the political cost? South Stream is dividing parties in Bulgaria and causing political instability, with accusations flying about secret deals with Gazprom and dodgy deals on who will build the pipeline. An early parliamentary election is likely to be held in the autumn.
In the greater scheme of European things, there are concerns that the long and slippery tentacles of Moscow power are exerting more and more influence in Europe, especially in energy. “We are already feeling significant Russian pressure related to major energy projects,” Dimitar Bechev, a senior policy fellow at the European Council on Foreign Relations, told the Sarajevo-based news portal BalkanInsight.com on 21 March. Referring to South Stream he added: “This pressure doesn’t always take the form of direct coercion… It is obvious that Russia is co-opting people and buying influence… The methods are much more visible in the former Soviet countries, but are also being implemented in the Balkans, in Bulgaria as well as in Serbia, Montenegro, Bosnia and elsewhere,” he stressed. There could be short-term gain for Bulgaria but then dependence on Russia, whose economy would be the real winner. Thanks to the South Stream, Bulgaria would be tied even more to its distant past, Russia, than to its near future, the European Union.
Peter Dutczyn for Ukraine Crisis Media Center
