According to Mr. Gref, Russia now has over 3,000 such enterprises, which employ very few workers. Meanwhile the state owns less than 12% of some corporate stocks.
Our Ministry had suggested leaving just over 200 strategic enterprises, Mr. Gref said.
In his words, the list of strategic enterprises being suggested by the Economic Development and Trade Ministry comprises 672 joint-stock companies, as well as 528 state-run integral enterprises.
We must limit the list of strategic enterprises to defense and security enterprises, as well as other enterprises for fulfilling particularly important state functions, Gherman Gref continued. All other enterprises must be struck off this list, the Minister added.
It is intended to sell 560 state-owned stocks of shareholding companies in line with the 2005 privatization plan. Right now, the state owns shares of nearly 4,000 joint-stock companies.
The Economic Development and Trade Ministry estimates that Russia has 9,222 operational federal state-run integral enterprises; of this number, 1,324 entities are to be privatized over the 2004 period. Meanwhile their real-life sale is stipulated by subsequent measures, Mr. Gref went on to say.
The Minister deems it inexpedient to pass special Cabinet resolutions on reorganizing such enterprises. This should become a working process devoid of governmental resolutions and specific ministries should assume responsibility for this process, Gherman Gref stressed.
Three organizational-legal forms are possible during the reorganization of such federal state-run integral enterprises, i.e. federal enterprises, state-run non-profit organizations and public companies, Mr. Gref said. In that case, the state won't relinquish control over federal property because the law expressly forbids corporate-asset purchases during the reorganization of federal state-run integral enterprises.
The 2004 fiscal privatization plan will be fulfilled, Mr. Gref noted.
Technically speaking, we can fulfil the 2005 fiscal privatization plan with regard to stock-sale volumes, he added.
The Minister said nothing about possible options for channelling the required 40 billion rubles into the federal budget. Previously, Cabinet representatives did say that the sale of LUKOil's federal-owned stock will help scoop projected privatization proceeds. The privatization program's fiscal aspects are to be implemented by selling a number of large entities, i.e. the Tuapse and Novorossiisk seaports, as well as the Magnitogorsk metallurgical factory.
All in all, 219 federal stocks were offered for sale since early 2004, Mr. Gref said. Only 94 of them were sold and another 125 still remain to be purchased. These stocks, which belong to minority shareholders, are not very popular on the market, according to him.
The state owns less than 25% of all corporate stocks. Minority-share packages and blocking packages account for 60% of all federal-owned stocks, due to be sold off next year, Mr. Gref added.
Svyaz-Invest stock-sale deadlines and stock size will depend on the market situation, Gherman Gref noted, adding that specific corporate-privatization options were now being analyzed rather actively.
An optimal share-sale machinery and timeframe will be chosen in line with the market situation, he said. The entire share package will total somewhere between 25% and 75% of the entire Svyaz-Invest stock, he stressed.
A mid-term (three-year) national privatization program will be approved by October 1, 2004, Mr. Gref went on to say.
The program will mostly aim to get rid of all property, which doesn't match state functions, he reminded those present.
All enterprises, which are not listed inthe privatization program (for any particular reason), must enhance their capitalization over the next five years, Mr. Gref pointed out. They must either continue to exist in the form of state-run commercial enterprises or they must convert to other patterns, he added.
The Economic Development and Trade Ministry will hold a seminar involving federal-agency representatives before this fall, discussing privatization plans for the years to come.
At the same time, the Ministry plans to simplify the relevant privatization procedure, making it more cost-effective. We intend to draft some amendments to the privatization law already this fall. Such amendments will simplify the privatization procedure, making it more cost-effective, Gherman Gref told Cabinet members.
According to him, the Ministry suggests a clear-cut procedure for regulating special money auctions; the entire real-estate registration system must be overhauled, and a federal property register compiled. Moreover, plans are in place to change the entire procedure for privatizing culture centers and other related facilities.
Special money auctions are quite rare nowadays. As we see it, their introduction will make it possible to ensure cost-effective property sales, Mr. Gref stressed.
The Minister suggested that commercial organizations fulfil all state prosthetic-appliance orders.
In his opinion, all state orders, particularly those in the field of prosthetic appliances, must be placed on the market because any other option leads to "opaque" prices and low-quality services.
Private European companies, including German companies, turn out the best prosthetics, moreover, they are not always assembled at state-run enterprises, the Minister pointed out.
Prosthetic-appliance enterprises are not subject to privatization in line with the Russian President's decree, Deputy Prime Minister Alexander Zhukov said. Such enterprises can be listed in specific privatization plans after2005, if we amend the presidential decree, Zhukov added.
