Privatization via auctions
The government stakes on the sale of assets at auctions: in December 51% of the shares of a mobile phone operator MTS will be auctioned. However, such privatization model will not secure significant foreign currency influx to Belarus.
On 6 September the State Property Committee of Belarus held auctions and sold shares of 3 of 20 enterprises put for sale. In particular, 100% of shares in the OJSC "Proton-M" (Zhitkovichi) have been sold. The new owner of the company became the “Gruzavtomarket” Ltd, which was the only bidder and agreed to pay the initial price plus 5%, accounting for nearly Br 1,314 million. Also, 99.3% of the shares of the JSC "Polymer" (Luninets region, VillageSinkevich) have been sold for Br2, 037 billion to a joint Belarusian-Lithuanian company “Torimeks”. The latter was the only bidder too, as well as the sale conditions: the initial price plus 5%. On similar terms, the initial price plus 5% have been sold 13.4% of the shares of the JSC “Zhitkovichles” for Br 556.1 million to the JSC “Univestsistem”.
On 1st December 2011 an auction to sell the state-owned shares (51%) of the largest Belarusian-Russian mobile operator “Mobile Telesystems” (MTS-Belarus) will take place. The co-founder, Russian JSC “Mobile Telesystems” has previously expressed interest in the controlling stake of MTS-Belarus however parties failed to reach an agreement. The initial price of 51% of the shares of MTS Belarus is USD 1 billion.
Belarus is trying to sell its assets at auctions hoping to get the maximum price and to avoid accusations of the lack of transparency and backroom agreements. However the main issue is that potential investors have little interest in the majority of auctioned enterprises. Moreover, the initial price is often inflated. With regard to the sale of 51% of shares of MTS at an auction, the announced starting price is exactly as indicated by Lukashenko. Russian co-owner refused to pay the price and it is unlikely anyone else would. Belarusian privatization model will not be able to secure significant foreign currency influx to Belarus. It should either start a genuine large-scale privatization (threatening with decline in output, unemployment, etc.), or continue a policy ofad hoc sales of strategic assets at a reduced (compared with the announced) price.
The Belarusian authorities regard the Catholic conference as yet another international event to promote Minsk as a global negotiating platform. Minsk’s proposal to organise a meeting between the Roman-Catholic Church and the Russian Orthodox Church is rather an image-making undertaking than a serious intention. However, the authorities could somewhat extend the opportunities for the Roman-Catholic Church in Belarus due to developing contacts with the Catholic world.
Minsk is attempting to lay out a mosaic from various international religious, political and sportive events to shape a positive image of Belarus for promoting the Helsinki 2.0 idea.
Belarus’ invitation to the head of the Holy See for a meeting with the Patriarch of the Russian Orthodox Church should be regarded as a continuation of her foreign policy efforts in shaping Minsk’s peacekeeping image and enhancing Belarus’ international weight. The Belarusian authorities are aware that their initiative is unlikely to find supporters among the leadership of the Russian Orthodox Church in Moscow. In Russia, isolationist sentiments prevail.
In addition, for domestic audiences, the authorities make up for the lack of tangible economic growth with demonstrations of growth in Minsk’s authority at international level through providing a platform for religious, sportive and other dialogues.