I am very pleased to be here this morning to address
this group on this topic and I want to first congratulate the
organizers of this event - the Center for the Study of Democracy -
for this open discussion of a very difficult issue. This discussion
helps raise the awareness about the public and private sectors,
about the negative effects of organized crime and corruption. And
this morning, for the most part, I'm going to speak about organized
crime.
The combined effect of opening the borders in Europe
and then this transitional period of post-Soviet market economies
in Eastern Europe has contributed to the ease with which organized
crime and illegal profits can move through the borders. This in
turn has contributed to the expansion of criminal networks. By its
international nature illegal activities such as trafficking in
arms, narcotics and people necessarily involves the co-operation of
customs agents, border police, law enforcement units, members of
judiciary and other government officials.
Organized crime in Bulgaria is not a new phenomenon.
It is simply more visible today. It existed before the change and
in that time I think it was simply integrated more closely into the
system. But the effect of the whole system to the establishment of
democracy has created some confusion. But we should make no mistake
- organized crime is absolutely incompatible with democracy.
Democracy and successful market economies rest their foundation on
the rule of law, the development of equal rights of citizens and
equal opportunities. And organized crime is a system which seeks
power and financial reward by illegal means. It has leaders and
organizations, it uses fear, violence, bribery for advantage and
operates outside the law and in some cases it may appear
respectable.
But the effects of these organizations are
devastating on the society and we cannot consider organized crime
as an isolated fact, a group that exists away from decent people.
Its effects are pervasive. Organized crime corrupts young people
and gives them the wrong signals, wrong rule models. Millions of
dollars are lost each year in taxes. This is money that is
available for health programs, for schools, for social services and
other serious requirements of the society. These people have no
concern for the well-being of the people of Bulgaria. It corrupts
the legal system and the courts cannot become effective. And it
damages the moral fiber of society. As wealth is generated by
organized crime and these groups grow, so there is a need to find a
legitimate means to hide their profits and therefore we face money
laundering - a movement of money through shell companies and some
would appear to be legitimate businesses.
Organized crime also gains access to public
administration, participates in privatization, procurement and
concession processes throughout the country. The economic effects
are significant and a substantial harm is inflicted on the national
economy from the lost of taxes, which I've mentioned, strip
resources of state on businesses and reduced investor confidence in
the country.
Secondly, bribery and corruption tilt the playing
field against honest businesses and create unfair advantages to
those willing to engage in unethical and illegal practices.
Ultimately these economic effects impede the development of a
middle class which is key to a stable economy and a political base.
A further danger is posed by the increase of organized crime money
being used for high-level influence and patronage to assist them in
their activities. This is a corrupt relationship between organized
crime, politicians and government officials that threatens the very
security of the state.
Bulgaria's perspective membership in NATO makes this
challenge all the more urgent. The threat to our security today,
and I'm not talking about just the security of Bulgaria but I'm
talking about the security of the US and the Western countries, is
not just military but terrorist and criminal groups thrive on
corruption and lax enforcement of laws and regulations. And this is
not confined to a single nation, these are global problems.
Organized crime is a major issue in Bulgaria.
Organized crime in Bulgaria is too prominent and too powerful and
everyone knows it - the people know it, the legal system knows it,
the police know it, prosecutors and courts know it and the
international investors know it.
But I have faith in Bulgaria. The country is
going to deal with this plague. People at some level and at some
point are going to demand that the country deals with it. The
question is when and how that will take place because to deal with
it would require a unified determined and forceful effort of
leaders, institutions and citizens and it would not be easy. But I
again have faith and I hope that this conference will bring about
new ideas and will generate a new enthusiasm, strategies for
addressing these important issues. I wish you very much a
productive conference. Thank you.
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