Russian officials are planning to privatise state-owned assets to bolster the economy in the wake of stringent Western sanctions. The privatisations, announced by Russian Finance Minister Anton Siluanov, revive a stalled 2010 campaign to sell state assets and generate billions in federal budget revenues. During a meeting with Rosimushchestvo, Russia‘s federal agency for property management, Siluanov announced major privatisations, where stakes in seven large companies would be sold to raise 300 billion rubles (£2.7 billion).
In 2023, Siluanov revisited the 2010 campaign proposing that the government sell shares in 30 state-owned companies without losing a controlling stake. Russia‘s Prosecutor General’s Office has filed lawsuits to seize assets from companies, which Vladimir Putin insisted was targeted at owners deemed to be harming the country’s security.
The military-industrial complex, engineering, food industries, ports, and properties owned by foreign buyers were all targeted.
Vladimir Milov, a critic of Putin and former Russian minister, said the proposal to sell stakes in companies would not attract market players as they wouldn’t have any influence over the firms. He told Newsweek: “This is of little interest for market players.
“Such minority ownership requires significant investment but doesn’t provide any opportunity for real influence over governance in companies still dominated by state control, and therefore remains simply a waste of money.
“No one wants to buy such useless minority stakes, which give zero influence and control.
“The value of assets actually privatised is negligible because for over two decades, the Russian government maintains control over key economic industries and do not want to let go of ownership of strategic players.”
Milov added that if the Kremlin sold minority shares in large state-owned firms, they would just be sold to other state players.
Finance Minister Anton Siluanov said, “We have had proposals for big privatisation” that will generate at least 100 billion rubles (£917 million) this year.
Putin has put every effort into creating a war economy by ramping up defence spending, but this combined with increasing economic sanctions from the West has sent interest rates up and the ruble down.
The Russian central bank set interest rates at 21%, its highest level in more than 20 years, while the ruble tanked in November to its lowest level in over two years.