SOFIA, June 14 (Reuters) - Brussels should impose financial sanctions on Bulgaria to force the government to speed up reforms and fight high-level graft effectively, local human rights groups said on Thursday.

The European Union newcomer faces possible cuts in financial aid from the bloc if it fails to prove it is taking effective action to uproot endemic corruption and reform its slow and inefficient administration.

The European Commission in Brussels said on Thursday it would not discuss a possible withholding of EU funds in its forthcoming June report on reform progress, but suggested it might consider financial sanctions later in the year.

Sofia's Socialist-led government says it is battling corruption and organised crime. But it has failed to put any high-level officials behind bars and rights groups say its anti-graft strategy lacks concrete measures.

"Sanctions will be good for Bulgaria, they can make the government actually do something. Up to now the anti-graft strategies have been just paper," said the director of the Bulgarian branch of the Helsinki Committee, Krasimir Kanev.

Surveys by the Centre for the Study of Democracy, a non-governmental organisation, show that corrupt public procurement deals, suspicious land sales and smuggling cost Bulgaria more than 2 billion levs ($1.36 billion) last year.

The poor Balkan country is due to receive over 11 billion euros in EU funds by end-2013 and may face a cut of 25 percent of direct farm payments if it fails to show it can absorb them.

On Thursday Sofia appointed a new head of the agriculture fund dealing with distributing EU farm subsidies, after almost three months of political wrangling that delayed projects worth more than 185 million levs ($126 million).

But rights groups say the government's preparations to benefit from EU membership and efforts to fight graft remain largely on the drawing board.

"The lack of transparency really worries us, there is no public report on what the government has achieved from its strategy," said Rumen Yanovski, project manager at the independent civil society foundation Access.

"Both the administration and the ruling parties are not taking the corruption problem seriously enough, as if it is not their problem, but somebody else's," he told a news conference.

By Kremena Miteva
World news - http://article.wn.com/