SOFIA: Bulgarians, frustrated by pervasive corruption and poverty in the EU's poorest newcomer, are hailing the European Union for punishing their government by suspending hundreds of millions of euros in subsidies.

"If EU subsidies have to go into bottomless pockets, let Brussels axe them," says Sofia beautician Boyka Naydenova, summing up a view shared by many of her compatriots.

A recent poll by the Alpha Research Institute showed almost 40 per cent of Bulgarians approved of EU pressure on the government via financial sanctions.

A total of 28 per cent favoured purely political sanctions without suspending money, while 16 per cent estimated the fight against crime and corruption was "a domestic problem."

A draft of a key European Commission report on Bulgaria's progress, to be released Wednesday, forecast that Brussels could cut some 600 million euros (US$955 million) of pre-accession aid to Bulgaria.

Fraud concerns already prompted the commission to freeze some 365 million euros of farming and road infrastructure money earlier this year and block post-accession transport and regional infrastructure programmes, from which Bulgaria was to receive up to 3.0 billion euros by 2013.

Sofia's poor handling of EU money was first uncovered in January when a newspaper revealed the government's road agency chief Veselin Georgiev had granted contracts worth hundreds of millions of euros to his brother's company.

Georgiev was forced to resign and the EU partly blocked infrastructure money.

In February, Bulgaria and Europe's anti-fraud agency OLAF broke up a criminal ring for syphoning off 7.5 million euros of pre-accession farming aid between 2005 and 2006.

But the case dragged on for months and a recent OLAF report, leaked to the press, hinted that high-ranking officials might be hindering the trial against the ring's mastermind, businessman Lyudmil Stoykov.

Stoykov had "allegedly financed the election campaign of the current Bulgarian president," OLAF said, which President Georgy Parvanov confirmed himself, although he denied protecting Stoykov.

"Society is taking the EU sanctions as a positive fact," leftist political analyst Petar-Emil Mitev commented recently.

"The imposition of strict rules is for Bulgarians one of the major advantages of EU accession."

The latest Eurobarometer survey, published last week, showed that public confidence in Bulgaria, in the government, police, army and judiciary, was at its lowest since the country joined the EU in January 2007.

Meanwhile, confidence in EU institutions had surged, with 51 per cent of people saying they trusted the European Commission.

For many Bulgarians, corruption is not only corroding power but also poisoning their everyday life, including the healthcare, education, police and judiciary sectors.

Seventy per cent of people polled by Alpha Research said corruption had grown over the past few years.

And with Bulgaria failing to jail any high-ranking official for corruption, the press has joined the public outburst in favour of pending EU sanctions.

"The EU signalled a counter revolution," Sega daily newspaper said in an editorial, describing the transition to a market economy as "a criminal revolution" that led to "record inflation and feeble purchasing power added to the everyday fear from crime and disgust for power."

But while freezing EU funds is seen by the majority of Bulgarians as a suitable punishment for those in power, it could mean bankruptcy for several hundred farmers who rely on aid.

"We imported cows from France and equipment from Germany after our project was granted funding from the (EU's) Sapard programme," said Stefan Lichev, a farmer from the southeastern city of Yambol.

"But the money was blocked and now we have to reimburse alone a credit of 1.9 million euros."

- AFP/yb