Bulgaria's Faltering Military Giant Goes on All-Out Strike
The troubled VMZ Sopot is the largest Bulgarian military plant, and has been expected to be privatized. File photo
Thousands of workers of the largest Bulgarian military plant, the state-owned VMZ Sopot, are staging once again Wednesday an effective strike.
The workers have been staging effective strikes since mid-December. They are outraged by the constant delays of their salaries and are rallying with demands for securing orders for military factory and better working conditions in the winter.
There was also a preliminary "warning" strike in November, which led to the signing of an agreement between the State-owned plant and the labor unions providing for the payments of delayed salaries by the end of the month.
However, by November 30, 2012, the workers failed to receive all of the dues.
On Monday, Economy and Energy Minister, Delyan Dobrev, pledged the Council of Minister would issue ASAP a decision about the privatization of the plant.
The only approved company will submit its bid and financial guarantees to the Privatization Agency by January 11, and they will be presented before the Economy and Energy Ministry by January 15.
Dobrev promised to submit the bid with the Council of Ministries for discussion within 3 days after receiving it. He stressed the privatization was the only solution of the problems of VMZ Sopot. If the Cabinet does indeed approve the deal on January 23, workers could receive some advance payments, while all overdue salaries could be paid by the end of the month, but only if the plant is privatized.
On November 5, 2012, the Bulgarian Privatization Agency made it clear that a local company, Emko EOOD, is the only bidder with any chance to win the tender for buying the ailing military plant as the other two applicants failed to meet the privatization criteria.
The syndicates claim VMZ Sopot is not short of orders, and that it can be a successful producer, with the VMZ management doing everything necessary to request a company credit that has not received the Economy Minister's approval.
The troubled VMZ Sopot is the largest Bulgarian military plant.
Candidates applying to buy VMZ Sopot were eligible to bid for it upon proof they have enough funds to cover its mounting debts, totaling some BGN 140 M, according to the strategy for the privatization of VMZ Sopot adopted by the Bulgarian Parliament in 2011, and the future owner will not be allowed to lay off workers in the first three years after buying it.
Sopot, where the plant is located, is the birthplace of Bulgarian writer and poet Ivan Vazov, after whom it was named. The plant was founded in 1936, and during the communist period was developed into a large-scale military industrial unit.
VMZ Sopot produces anti-tank guided and unguided missiles, aviation unguided missiles, artillery ammunition, fuses. It also manufactures civilian products – it makes diamond tools, abrasive discs and grinding wheels, gas cylinders, food industry equipment, and household appliances.
VMZ Sopot has been in a troubled financial condition in the last few years. In 2007, Bulgaria's Privatization Agency started to sell some of the plant's assets in order to cover part of its debts; some of its assets were also sold at the beginning of 2009.
The bulk of the Bulgarian military-industrial complex was created during the communist period when the People's Republic of Bulgaria made lots of cash by selling arms mostly to developing countries. Together with the former USSR and the former Czechoslovakia, Bulgaria was the third COMECON member specializing in the defense industry.
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