MANAGEMENT OF COAL COMPANIES TO BE PRIVATIZED.
Publication: Monitor Volume: 2 Issue: 236
On December 9 Russian president Boris Yeltsin signed a decree that will "transfer on trust" state shares in 5 coal companies (Bashkirugol, Vostsibugol, Krasnoyarsk Coal Company, Lenigradslanets, and Kakhasugol). Altogether, the five represent 27 percent of Russian coal production. The transfer of shares on trust confers managerial control but no property rights. The scheme, which is an attempt to introduce some competition in the industry, has been discussed recently with the World Bank. It is hoped that the transfer of managing rights in the coal industry will reduce dependence on state subsidies, diminish wage and tax debts, and increase profitability. According to Fuel and Energy Ministry officials, the managerial abilities of the potential trustees are the main factor taken into account in the allocation of shares. The newly appointed managers will have to confer with state authorities on fundamental questions such as the reorganization and liquidation of enterprises, increases of chartered capital, and the issuance of securities. The government is currently reviewing the possibility of increasing the number of companies included in this program, and it is possible that up to 25 percent of all Russian coal companies will be directed by managers selected on a competitive basis by the end of 1997. (Interfax, December 16, Itar-Tass, December 16) A wave of strikes over wage arrears and accusations of misuse of a World Bank credits have recently added to the woes of Russia’s coal sector.
Russian Companies Sign Modest Oil Deals with Iraq.