Green project causes plant closure

15 September 1998

Bulgarian NGOs are angry about the sale of a major copper smelter to a Belgian company as part of a World Bank environment project. Mariana Kosturkova of Bulgaraian NGO For the Earth and the CEE Bankwatch Network commented:

“with this privatisation deal the WB is doing nothing less than destroying the country’s electronic and cable industry.”

They argue that the enterprise was sold too cheaply on the basis of flawed studies by international consultants, and that the World Bank exerted undue pressure to partly close and partly sell one of the country’s key strategic industries.

The Bank proposed loans to clean up environmental damage from past operation of the smelter and to compensate laid-off workers, but said that money for these was conditioned on full sale of the copper smelter.

Consultants hired by the Bank argued that the smelter should import copper concentrate from Chile, rather than use Bulgarian ore, and that the whole electrolytic copper unit should be shut down. This approach benefitted Union Minier, the successful bidder for the plants, which, with its plants in Belgium and Italy, will now hold a virtual monopoly position in electrolytic copper production. Bulgarian NGOs fear that this decision, relegating Bulgaria to a supplier for UM‘s plants abroad, will lead to the closure of many cable production and electronics plants in their country.

Contact: For the Earth, P.O.box 975, Sofia 1000, Bulgaria, ftearth@bulnet.bg