BULGARIAN TRADERS SANDWICHED BY SANCTIONS MEASURES AGAINST IRAQ, YUGOSLAVIA HURT ECONOMY

BULGARIAN TRADERS SANDWICHED BY SANCTIONS MEASURES AGAINST IRAQ, YUGOSLAVIA HURT ECONOMY

A natural bridge between Europe and the Middle East, Bulgaria finds itself squeezed by sanctions at both ends of its trade routes.

The government estimates that the United Nations embargo against the former Yugoslavia has cost Bulgaria's trade-oriented economy more than $6 billion since it began in 1992. Officials say the country's unfortunate geography - snuggled just below Belgrade on the Danube River - has choked it off from what it had hoped would become some its major markets after the fall of the Soviet trading bloc in 1990."Bulgaria is practically cut out of Europe," said Borislav Georgiev, the deputy minister of trade and foreign economic cooperation. "You can't carry some of our goods across the Black Sea, like agriculture for instance." More than 75 percent of Bulgaria's gross domestic product is generated by foreign trade.

Mr. Georgiev adds that breaking relations with Iraq, as ordered by the international community after the 1991 Gulf War, has eliminated another of Bulgaria's major trading partners and has kept the treasury from recovering the more than $1 billion that Iraq owes it.

REPORTS OF EMBARGO-BUSTING

But critics and analysts say the government is overstating the losses, and that quite a bit of embargo-busting goes on.

"They have some problems because it's more difficult to import and export to Central Europe, but I doubt whether its $6 billion," said Stefan Krause, the Bulgaria specialist at the Prague-based Open Media Research Center.

International media brought charges in late July that Bulgaria was hoping to relax its behavior toward Yugoslavia, and observers in the area report sightings of Yugoslav oil tankers lined up at Bulgarian refineries for loading.

But Bulgarian exporters and transporters tell a different story.

The chemical- and petroleum-trade company Chimimport has lost nearly all of the $25 million turnover it had with Yugoslavia in 1991, said its crude-oil products manager, Orlin Dimitrov, along with most of its Central Europe business, which used to travel via the Danube. Mr. Dimitrov puts the company's losses at 180 million lev ($7.8 million) for 1992 alone, and because Yugoslavia's assets are frozen, the company is owed an additional several hundred thousand dollars.

"We're desperate to get these sanctions lifted," he said. "I don't think they've made any difference. Some people have gotten richer, but nearly everybody has gotten poorer."

A FREIGHT FORWARDER'S WOES

Vladimir Dimtchev founded a freight-forwarding company, Vectra, in 1990 with a base of business delivering goods from Europe through Bulgaria to the Middle East and Asia, but he didn't count on the embargoes.

"We've lost . . . major parts of exports to Central and Western Europe

because you cannot move it cheaply and quickly," he said.

Special clearance procedures on the Danube and alternate land routes have taken the biggest toll, Mr. Dimtchev said. In December 1994, he applied for a United Nations permit to deliver 45 trolley buses from Bonn to Sofia via the Danube. He got the permit only in May, and said he hadn't known until the last minute whether it would be granted at all.

In addition, instead of the straight shot through Belgrade to Austria that his drivers used to use, they now must traverse Romania and Hungary, with borders notorious for their long waits and high tariffs. Mr. Dimtchev said he shells out $600 a truck to cross Romania and another $570 to go through Hungary. Trucks wait anywhere from 30 hours to three days on each frontier.

"You cross a Western border in one hour," he lamented.

MOVING WEST VIA THE BLACK SEA

The Bulgarian transport company Somat - the largest hauler in the world, with 4,500 vehicles - has abandoned its Danube catamaran service between the northwestern Bulgarian city of Vidin and Passau, Austria, which used to offer customers a cheap, efficient way to move trailers. Because of weight limits on Romanian and Hungarian roads, Somat has also had to divert cargo to the Black Sea, racking up additional distance on a water journey to Slovenia. The cargo then goes by truck through Austria.

"Customers knew us in the past as a quick carrier, but nowadays we cannot reply to their needs," said Somat's commercial director, Elka Popova.

But the bigger problem, say company officials, is the 25 percent of cargo flow lost because of sanctions against Iraq. Before 1990, Somat made 2,000 transports a month to Iraq, and now it makes none at all.

"We've lost our position in the Middle East almost completely," said Ms. Popova.

Chimimport's Mr. Dimitrov said the Iraq embargo left his company in the hole for 3 million tons of undelivered oil. A pre-embargo contract specified delivery of 5 million tons of oil from Iraq to Bulgaria, but only 2 million tons were delivered before sanctions came into effect.

"This Iraq embargo is very bad for our business," he said.