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Russian privatization behind schedule

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MOSCOW, August 3 (RIA Novosti) - The Kremlin is upset over the progress of privatization in the first half of this year, a government spokesperson said ahead of Thursday's Cabinet session.

According to the source, 22 federal unitary enterprises were privatized in the first half of 2005, out of the 1,453 scheduled for this year's privatization.

The source added that only 114 state-owned stakes were sold of the 1,493 stakes in joint stock companies that the government had planned to sell.

"This is only 7.7 % of the total amount of enterprises slated for privatization," the official said.

He specified that 27.6 billion rubles, or about $1 billion, were added to the budget from sales, including 22 billion rubles, or about $770 million, from the sale of Magnitogorsk Integrated Iron and Steel Works.

"This means that the privatization plan for 2005 has not been implemented to the fullest extent," the source said.

He blamed differences among the Russian Federal Property Agency, the Russian Federal Property Fund and the Ministry of Economic Development and Trade on the procedure of selling federal property.

He said, however, the deadlock has been overcome.

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