Belarus asks Rothschild for privatisation advice

By Andrei Makhovsky and Lidia Kelly

MINSK, Feb 19 (Reuters) - Belarus took a step towards more privatisation of its economy on Friday when it invited the Rothschild Group to advise the government how to do this in an effort to boost the state-run, enfeebled economy.

Belarus President Alexander Lukashenko asked the Rothschild Group to advise his government about privatisation at a meeting with top executive of the financial services group.

"We not only want to receive your (price) estimates of privatised companies, we would like to learn a lot from you," Lukashenko told the gathering.

Belarus, which Lukashenko has ruled since 1994, remains one of the least reformed countries of the pre-1990 eastern bloc.

Last year, deteriorating demand from recession-hit Russia and Europe, its chief exports markets, dented the $44.5 billion economy drastically, forcing the government to look for sources of external funding and shifting it to seek warmer ties with the West.

"It would suit us very well to work with your specialists. If you agreed we could soon delegate several projects and work on them seriously," Lukashenko told the visiting Rothschild executives, who only recently backed the initial public offering of Russia's UC RUSAL, the world's largest aluminium maker.

Belarus's gross domestic product, GDP, grew by a mere 0.2 percent last year, according to official statistics, following five years of around 10 percent growth.

Both the International Monetary Fund and the World Bank, which have been financially aiding the country through the recent downturn, have urged privatisation, not only as a way to liberalise the economy but also to generate much needed cash for the government.

In December, Nikolai Snopkov, the new economy minister, called for speeding up liberalisation if the government hopes to reach the ambitious 11-13 percent growth pace forecast for 2010 .

But the government managed only one privatisation last year, selling BPS Bank to Russia's biggest lender, Sberbank, for slightly over $280 million.

In December, Belarus said that it might be willing to sell the oil refinery and chemical complex Naftan-Polymer to a Russian company, possibly Russia's No. 2 oil producer LUKOIL. (Writing by Lidia Kelly; editing by Stephen Nisbet)


Partners: Social Network