News / Economy

Russia Hopes to Raise $5.5 Billion from Privatizations in 2014

A Lenta supermarket sign is pictured in Moscow. Russian hypermarket chain Lenta, part-owned by U.S. private equity firm TPG, has set a price range for its planned London market debut, which implies a market valuation of up to $5 billion, Feb. 3, 2014.
A Lenta supermarket sign is pictured in Moscow. Russian hypermarket chain Lenta, part-owned by U.S. private equity firm TPG, has set a price range for its planned London market debut, which implies a market valuation of up to $5 billion, Feb. 3, 2014.
Reuters
Russia's prime minister said on Monday he hoped to raise more than $5.5 billion this year by selling stakes in state companies, reviving a delayed privatization program that could spur a flagging economy.
 
At a meeting with deputy prime ministers, Dmitry Medvedev also sounded a note of caution, saying the sale of shares in companies such as Rostelecom or shipping group Sovcomflot could happen only in good market conditions.
 
Launched in 2010 by then Finance Minister Alexei Kudrin, the $50-billion privatization drive to reduce the state's direct role in the economy and improve a much-criticized investment climate has been dogged by delays.
 
Assets have since been removed from the lists, prey to volatile markets and a tug-of-war between more liberal-minded politicians and hardliners favoring a slower approach to privatization.
 
“Just this year, we have a quite serious privatization plan to raise 200 billion roubles ($5.7 billion), and I hope that these plans will be fulfilled,” Medvedev told the meeting.
 
“[The approach to privatization] should be balanced. We should not delay but at the same time we should consider the economic circumstances in the world and in the country.”
 
Russia's economic growth has slowed, reaching just over 1 percent last year after hitting an average 7 percent before the 2008/09 financial crisis. Privatization revenues would help meet generous election promises made by President Vladimir Putin.
 
Last June, Russia halved its privatization target for 2014 to around $5.5 billion after many previously planned sales were stalled because of adverse market conditions.
 
The results of the sales so far have been mixed.
 
Divisions

 
Sberbank, Russia's largest bank, attracted strong investor demand for its stake sale in 2012, raising more than $5 billion, and the country's second-largest bank, VTB, last year won sovereign backing for a $3.3 billion share issue.
 
But a 16 percent stake in state diamond miner Alrosa was priced at the bottom of a planned range, valued at $1.3 billion, in October.
 
The main sell-off penciled in for 2014 is a stake in Rosteleom, which competes with Russia's three main private mobile operators - MTS, Megafon and Vimpelcom . Rostelecom recently merged its mobile assets with VTB's Tele2 Russia mobile unit into a single company, T2 RTK Holding.
 
Olga Dergunova, head of the State Property Agency, told the meeting Russia expected to receive 150 billion roubles from that sale and the privatizations could start in the second quarter with Sovkomflot. She did not disclose the amount expected to be sold in Rostelecom.
 
State capitalists such as Igor Sechin, the head of state energy company Rosneft and a long-time ally of Putin, oppose privatization - including of his own company.
 
The state had been planning to sell its stake in Novorossiisk Commercial Sea Port (NCSP) by the end of 2013. Rosneft asked Putin in October to sell it the state's 20 percent stake.
 
A further stake in VTB is due to be sold in 2015.

You May Like

Kurdish President: More Needed to Defeat Islamic State

In interview with VOA's Persian Service, Massoud Barzani says peshmerga forces have not received weapons, logistical support needed to successfully fight IS in northern Iraq More

Sierra Leone's Stray Dog Population Doubles During Ebola Crisis

Many dog owners fear their pets could infect them with the virus and have abandoned them, leading to the increase and sparking fears of rabies More

Video New Brain Mapping Techniques Could Ease Chronic Pain

New methods for mapping pain in the brain not only validate sufferers of chronic pain but might someday also lead to better treatment More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
New Brain Mapping Techniques Could Ease Chronic Paini
X
Shelley Schlender
April 20, 2015 7:03 PM
Pain has a purpose - it can stop you from touching a flame or from walking on a broken leg. As an injury heals, the pain goes away. Usually. But worldwide, one out of every five people suffers from pain that lasts for months and years, leading to lost jobs, depression, and rising despair when medical interventions fail or health experts hint that a pain sufferer is making it up. From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.
Video

Video New Brain Mapping Techniques Could Ease Chronic Pain

From Boulder, Colorado, Shelley Schlender reports that new methods for mapping pain in the brain are providing validation for chronic pain and might someday guide better treatment.
Video

Video Hope, Prayer Enter Fight Against S. Africa Xenophobia

South Africa has been swept by disturbing attacks on foreign nationals. Some blame the attacks on a legacy of colonialism, while others say the economy is to blame. Whatever the cause, ordinary South Africans - and South African residents from around the world - say they're praying for the siege of violence to end. Anita Powell reports from Johannesburg.
Video

Video Italy Rescues Migrants After Separate Deadly Capsize Incident

Italy continued its massive search and rescue operation in the Mediterranean Monday for the capsized boat off the coast of Libya that was carrying hundreds of migrants, while at the same time rescuing Syrian migrants from another vessel off the coast of Sicily. Thirteen children were among the 98 Syrian migrants whose boat originated from Turkey on the perilous journey to Europe.
Video

Video New Test Set to Be Game Changer in Eradicating Malaria

The World Health Organization estimates 3.4 billion people are at risk of malaria, with children under the age of five and pregnant women being the most vulnerable. As World Malaria Day approaches (April 25), mortality rates are falling, and a new test -- well into the last stage of trials -- is having positive results in Kenya. Lenny Ruvaga reports for VOA from Nairobi.
Video

Video Are Energy Needs Putting Thailand's Natural Beauty at Risk?

Thailand's appetite for more electricity has led to the construction of new dams along the Mekong River to the north and new coal plants near the country's famous beaches in the south. A proposed coal plant in a so-called "green zone" has touched off a debate. VOA's Steve Sandford reports.
Video

Video Overwhelmed by Migrants, Italy Mulls Military Action to Stabilize Libya

Thousands more migrants have arrived on the southern shores of Italy from North Africa in the past two days. Authorities say they expect the total number of arrivals this year to far exceed previous levels, and the government has said military action in Libya might be necessary to stem the flow. VOA's Henry Ridgwell reports.
Video

Video Putin Accuses Kyiv of ‘Cutting Off’ Eastern Ukraine

Russian President Vladimir Putin, in his annual televised call-in program, again denied there were any Russian troops fighting in Ukraine. He also said the West was trying to ‘contain’ Russia with sanctions. Henry Ridgwell reports on reactions to the president’s four-hour TV appearance.
Video

Video Eye Contact Secures Dog's Place in Human Heart

Dogs serve in the military, work with police and assist the disabled, and have been by our side for thousands of years serving as companions and loyal friends. We love them. They love us in return. VOA’s Rosanne Skirble reports on a new study that looks at the bio-chemical bond that cements that human-canine connection.
Video

Video Ukrainian Volunteers Search for Bodies of Missing Soldiers

As the cease-fire becomes more fragile in eastern Ukraine, a team of volunteer body collectors travels to the small village of Savur Mohyla in the what pro-Russian separatists call the Donetsk Peoples Republic - to retrieve bodies of fallen Ukrainian servicemen from rebel-held territories. Adam Bailes traveled with the team and has this report.
Video

Video Xenophobic Violence Sweeps South Africa

South Africa, long a haven for African immigrants, has been experiencing the worst xenophobic violence in years, with at least five people killed and hundreds displaced in recent weeks. From Johannesburg, VOA’s Anita Powell brings us this report.
Video

Video Apollo 13, NASA's 'Successful Failure,' Remembered

The Apollo 13 mission in 1970 was supposed to be NASA's third manned trip to the moon, but it became much more. On the flight's 45th anniversary, astronauts and flight directors gathered at Chicago's Adler Planetarium to talk about how the aborted mission changed manned spaceflight and continues to influence space exploration today. VOA’s Kane Farabaugh reports.
Video

Video Badly Burned Ukrainian Boy Bravely Fights Back

A 9-year-old Ukrainian boy has returned to his native country after intensive treatment in the United States for life-threatening burns. Volodia Bubela, burned in a house fire almost a year ago, battled back at a Boston hospital, impressing doctors with his bravery. Faith Lapidus narrates this report from VOA's Tetiana Kharchenko.
Video

Video US Maternity Leave Benefits Much Less Than Many Countries

It was almost 20 years ago that representatives of 189 countries met at a UN conference in Beijing and adopted a plan of action to achieve gender equality around the world. Now, two decades later, the University of California Los Angeles World Policy Analysis Center has issued a report examining what the Beijing Platform for Action has achieved. From Los Angeles, Elizabeth Lee has more.
Video

Video Endangered Hawaiian Birds Get Second Chance

Of the world's nearly 9,900 bird species, 13 percent are threatened with extinction, according to BirdLife International. Among them are two Hawaiian honeycreepers - tiny birds that live in the forest canopy, and, as the name implies, survive on nectar from tropical flowers. Scientists at the San Diego Zoo report they have managed to hatch half a dozen of their chicks in captivity, raising hopes that the birds will flutter back from the brink of extinction. VOA’s George Putic reports.
Video

Video Exhibit Brings Renaissance Master Out of the Shadows

The National Gallery of Art in Washington has raised the curtain on one of the most intriguing painters of the High Renaissance. Mostly ignored after his death in the early 1500s, Italian master Piero di Cosimo is now claiming his place alongside the best-known artists of the period. VOA’s Ardita Dunellari reports.

VOA Blogs

World Currencies

EUR
USD
0.9247
JPY
USD
118.78
GBP
USD
0.6657
CAD
USD
1.2190
INR
USD
62.395

Rates may not be current.