MercoPress, en Español

Montevideo, May 25th 2024 - 16:42 UTC



Russian planning massive sale of assets to cover budget deficit

Monday, July 26th 2010 - 03:41 UTC
Full article
Prime Minister Vladimir Putin is expected to run again for president in 2012 Prime Minister Vladimir Putin is expected to run again for president in 2012

Russia plans the largest sell-off of state assets since the early 1990s as it seeks to raise over 29 billion US dollars to plug budget gaps over the next three years, finance ministry sources told reporters. The plan to sell minority stakes in 10 major companies in 2011-2013 had been discussed and approved at a preliminary meeting chaired by Prime Minister Vladimir Putin.

The sales would include 27.1% in state oil pipeline monopoly Transneft, 24.16% of Russia's largest oil producer Rosneft, 24.5% of Russia's No.2 bank VTB), 9.3% of largest lender Sberbank, 25% minus one share of rail monopoly RZhD.

Russia wants to cut its budget deficit to 4% of GDP in 2011 and 2.9% in 2012 from around 5% (80 billion USD) this year, but a presidential election in 2012 also puts pressure on the government to keep social spending high.

”The finance ministry has made proposals on possible privatizations in 2011-2013, which will allow (us) to collect some 9.88 billion a year USD,“ one of the sources said. ”The biggest companies will be up for sale in such a way that the government keeps controlling stakes” he added.

The proposals see Russia reducing its stakes in most of the companies to 50% plus one share, which allows the government to still exercise full control over the decision-making process.

Other firms on the list include 28.11% of power grid FSK), 9.38% in hydro power generator RusHydro, 49% in mortgage agency AIZhK, 49% in agricultural bank Rosselkhozbank and 25% minus one share in shipping major SovComFlot.

Categories: Economy, Politics, International.

Top Comments

Disclaimer & comment rules

Commenting for this story is now closed.
If you have a Facebook account, become a fan and comment on our Facebook Page!