By William Maclean

ALGIERS, Feb 7 (Reuters) - A war of words between Libya and Bulgaria is likely to delay efforts to free five Bulgarian nurses and a Palestinian doctor sentenced to death for infecting Libyan children with the virus that causes AIDS.

Libya will find it hard to commute their sentences or free them in an atmosphere of mutual recrimination and when both sides display signs of aggrieved national pride, experts say.

"If you want the problem solved this is not the way to do it," said Saad Djebbar, a London-based Algerian lawyer who is an expert on Libya. "It will complicate and lengthen the process."

The medics were convicted in December of deliberately infecting hundreds of children at a Libyan hospital in the 1990s. The Supreme Court is due to rule on an appeal shortly.

European Union newcomer Bulgaria and its allies say overwhelming scientific evidence shows the medics are innocent.

Even if the conviction is upheld, a government-led Libyan body can overturn it. Experts say that is likely to happen only if Western nations and Libya can agree on how much Western nations should pay towards a fund that has been set up to help the surviving children's treatment.

Prospects of such a deal -- long discussed by Libya and Western officials as a face-saving solution -- may have been dimmed by recent rhetoric.

On Tuesday, Libyan state media accused the Bulgarian intelligence service of orchestrating the children's infection.

"Agents of Bulgarian intelligence who injected our children with the HIV virus committed a crime more ugly than the crimes of (Adolf) Hitler," said al-Shams newspaper.

DEMONSTRATION, PRAYER

Bulgaria has condemned the trial and criticised comments by Libyan leader Muammar Gaddafi in late December in which he defended the convictions.

In Sofia, foreign ministry spokesman Dimitar Tsanchev said: "The thesis that secret services were behind a plot that resulted in the deliberate infection of hundreds of Libyan children with HIV was discarded by a Libyan court in 2002."

George Joffe, of the Centre of International Studies at Cambridge University, said the issue of compensation for the families lay at the heart of the latest public bitterness.

Tripoli wants 10 million euros ($12.96 million) for each infected child's family. Joffe said Western nations had offered about half a million euros per family, which Libya rejected.

"It's quite a big gap. Gaddafi has got to sell the deal at home. For him it's a matter of internal stability," he said.

Bulgaria, an EU member since Jan. 1, and its allies have created an international fund to give treatment, medicine and other aid to the children and their families.

Bulgaria rejects any compensation payout, which it says would admit guilt. It says any financing of the fund must be done voluntarily, rather than as a diplomatic or political step. Reports have suggested Gaddafi might overturn the verdicts if, in addition to compensation, a Libyan jailed in Scotland for the 1988 Lockerbie bombing was released.But there has been no confirmation of these reports by Libyan government officials. (Additional reporting by Sofia bureau)

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