President of Ukraine

Volodymyr Zelenskyy: Privatization is not about the funds the state will receive from the sale, it is about paying taxes monthly, annually

15 June 2021 - 14:55

Volodymyr Zelenskyy: Privatization is not about the funds the state will receive from the sale, it is about paying taxes monthly, annually

Ukraine has the political will to carry out large-scale privatization, as the state is an inefficient asset manager. The mechanism of public-private partnership can be applied to strategic enterprises that must remain state-owned. This was stated by President Volodymyr Zelenskyy in an interview for Ukrainian TV channels in the framework of the All-Ukrainian Forum "Ukraine 30. Economy without Oligarchs" in Kyiv.

"The state is not the coolest manager," he said.

In addition, as the President noted, the state does not have billions to modernize a particular enterprise. Therefore, large-scale privatization is needed.

"First of all, it is important not how much the state will receive at the beginning, but how much taxes it will receive monthly, annually. Business is not about buying and selling, it is not about mediation. Business is a constant investment of money in technology, ideas, creativity, and then a constant receipt of small profits. Business is 10-15-20% of constant profit,” Volodymyr Zelenskyy explained.

The President said that the State Property Fund is already preparing a number of state-owned enterprises for privatization. Earlier, the SPFU received the Ukraine and Dnipro hotels from the State Affairs Administration. The latter was sold at an open transparent auction last summer for a record amount. The President Hotel is currently being prepared for privatization.

In addition, preparations are underway for the privatization of Centerenergo PJSC, which, according to Volodymyr Zelenskyy, has been cleared of all groups of influence. Work is also underway to sell the Odesa port plant, etc.

At the same time, the President added: "There are strategic enterprises that the state has no right to get rid of".

Therefore, according to him, the mechanism of public-private partnership can be applied to large strategic and potentially profitable state-owned enterprises, when one or another private company invests in modernization and makes a profit while the enterprise remains in state ownership.

"One shouldn’t be afraid of it. We see what is happening with Ukrzaliznytsia - it is simply impossible to watch without tears. They are bankrupt," the President said.

According to him, Minister of Infrastructure Oleksandr Kubrakov has been commissioned to make Ukrzaliznytsia profitable.

"Therefore, despite the fact that Ukrzaliznytsia is a strategic enterprise, I do not see a big problem for cool big retailers to enter the station buildings for example. For shops, cafes, cinemas to be there… I would lease all the stations, it would be very cool. Let people earn, let people get comfort," the President summed up.

Volodymyr Zelenskyy also positively assesses the desire of state-owned companies, in particular NJSC Naftogaz of Ukraine or NNEGC Energoatom, to arrange an initial public offering.

The President also noted that medium and small privatization is continued. "I think we need to get rid of hundreds of sanatoria that do not work or that have been "distributed", where the land was taken away. This has been done for many years. We realize this, no one justifies anyone. We need to get rid of everything for businesses to come," said Volodymyr Zelenskyy.