Workers of Bulgaria's Largest Military Plant Rebel over Unpaid Salaries

Industry | June 22, 2012, Friday // 16:05|  views

Workers in VMZ Sopot, Bulgaria's largest military plant, have threatened to resort to civil disobedience unless they receive their delayed salaries.

The employees of VMZ, which is located in the town of Sopot in Central Bulgaria, have not received their payments on time in the past 1.5 years, the Bulgarian National Radio reported Friday citing local unionists.

The syndicates insist that Bulgarian Economy Minister Delyan Dobrev approve a request for a company loan for the still state-owned arms producer so that the workers can get paid and the plant can purchase raw materials for its produce.

"The problems at VMZ Sopot have been dragging out for years but this time the workers demand the intervention of the Economy Ministry in order to overcome the situation," Ivanka Ivanova, head of the local organization of the KNSB (Confederation of Independent Bulgarian Syndicates) is quoted as saying.

"At present, the employees are yet to receive part of their January 2012 salaries, the April salaries, and advance payments on their June salaries; the May salaries will be soon be due as well. It's really hard! There is social tension not only in the VMZ factory but also in the entire region because the factory employees over 3 000 people. We've got entire families working here!" she added.

Ivanova did stress that VMZ Sopot is not short of orders, and that it can be a successful producer.

"The VMZ management has done everything necessary to request a company credit but the Economy Minister's approval hasn't been granted for 2 weeks! We do have contracts on which we are supposed to work. I am saying "supposed to work" because we work with whatever raw materials we have got. We have clearly stated in our letter to the minister that we will undertake syndicate and civil actions," the union leader elaborated.

The troubled VMZ Sopot is the largest Bulgarian military plant, and has been expected to be privatized.

Candidates applying to buy VMZ Sopot will be eligible to bid for it if they demonstrate 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.

The VMZ Sopot plant employs 3 700 workers. It is located in the town of Sopot in central Bulgaria, which 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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Tags: Military-industrial complex, defense industry, VMZ Sopot, military factory, minority stake, state-owned, Defense Minister, Defense Ministry, privatization, delayed salaries, Delyan Dobrev, Economy Minister


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