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Chief executives obstructing sale of state-controlled companies

The privatization of many companies scheduled to be sold into private hands between 2011 and 2013 is being obstructed by their chief executives who seek to secure the backing of the local authorities and representatives of the national government, Ryhor Kuznyatsow, head of the State Property Committee, told reporters in Minsk on Thursday.

The managers are afraid that they can lose their post for failure to ensure the company’s efficient performance, and they try to “shake up the staff, intimidate them and foil biddings contests and auctions,” said Mr. Kuznyatsow.

“For instance, the thing happened to Lida Food Concentrates Plant that was to be sold on a competitive basis on conditions laid down by [Belarusian state food industry conglomerate] Beldzyarzhkharchparm,” he said. “When the time of the contest approached and good investors with large sale markets showed up, the contest failed,” the official said.

He said that the chief executives of Baranavichy Garment Factory and the Elegant clothing company also tried to obstruct the sale of the entities by appealing to the local governments and trade unions. “It is bad that higher-level ministries and other agencies do their bidding,” said Mr. Kuznyatsow.

In addition, he said, some governmental agencies in charge of companies have never examined their performance in detail. “They first propose selling a company through a competition or at auction, but when we announce the date of the contest or auction, they send a letter saying that they have change their mind.”

One more factor that is putting the brakes on the sale of companies is the governmental agencies’ harsh conditions that scare off investors, he added. // BelaPAN