Analysis: New phase in privatization of power facilities in Kazakhstan

/IRBIS, Apr 9, 01/ - The GSRW informs that the Kazakhstan government has discussed problems related to the privatization of regional electrical power grid companies. According to Energy Minister Vladimir Shkolnik, some 21 regional electric grids are functioning in Kazakhstan. Eleven companies are state-owned or have state funds in their authorized capital, including six companies directed by the government and five by the public. Of ten other companies, three were leased for a 5-year period under investment obligations, two were passed on to Almaty Power Grid and the other five were given to private companies for settlement of debts in compliance with a court decision. The Ministry of Energy has not offered a scheme for the privatization of electric grid companies. The Ministry has passed three versions: 1. the sale of electric grids using the bankruptcy procedure; 2. the privatization of companies to divide them into local electric grids; 3. the sale of shares. None of the versions are attractive to investors. The first will bring a negative effect to creditors of companies. The second will make privatization even more complicated by doubling the structure and reducing management efficiency; the last version is unpromising due to the large accounts payable. The Energy Ministry and the State Property Committee have developed together a privatization plan (which comprises all the three versions) to be carried out with the assistance of the EBRD. The Bank is expected to allocate 761,000 Euros for the services of specialists who will be invited to consult the government on the privatization of state shares. One aspect is not clear, however: on what terms will this sum be allocated? There are good reasons to presume that this will rest on the tax payers' shoulders. A question arises - is there not a single expert among 16 million Kazakhstani citizens who could do this job? Talking about EBRD participation, Shkolnik said the EBRD intends to purchase 10% of the regional electric grids in order to attract prominent and stable investors for privatization. Then, the EBRD plans to sell its 10%, i.e. to make a profit. Mayors of some regions attended the meeting as well. They accuse Vladimir Shkolnik of lobbying for Russia's RAO Power Grids. Prime Minister Tokayev has taken the role of an advocate, charging the mayors with political tactlessness. When evaluating the results of the meeting, Tokayev distinctly stated that the speed the privatization is not a priority. In connection with this, a statement from Rakhanov, head of the State Property Committee, comes to mind. He said the department stands for privatization of all state-owned facilities (as written in a previous analytical overview of GSRW). How do the statements of a head of the government and his subordinate officials who apparently meditate more globally conform? The new program privatizing regional electric grids is coming to a close. But why is the old program being passed for consideration? The Great Silk Road World News Agency 7, Gainsford Street, London, SE1 2NE, U.K. TEL/ FAX 44 0171 403 20 37 greatsilkroad@btinternet.com