Konstiantyn Koshelenko: privatization of non-core state assets is an effective way to combat corruption

The State Property Fund is ready to commit to find effective investors for non-core state assets by conducting transparent privatization.

Deputy Chairman of the State Property Fund of Ukraine Kostiantyn Koshelenko stated this during the round table “Large Inventory of the Country”, dedicated to accelerating the pace of privatization.

According to the Deputy Chairman of the State Property Fund, today there are more than 3.5 thousand state-owned enterprises in Ukraine, which are managed by 96 different government agencies.

“Most of these enterprises have one thing in common - they are in a very sad financial situation. The reason for the losses is mostly the same - these assets work “in the pocket” of those who control them. The only way out is transparent privatization, which, in addition to replenishing the budget and attracting sustainable investments, solves another crucial task - eliminating corruption,” said Konstiantyn Koshelenko.

He also noted that the State Property Fund continued to work systematically to identify non-core state assets and welcomes the balance holders’ decision to transfer them to transparent privatization. As an example, he cited the consent of the State Fiscal Service to privatize the recreation center “Sosnovyi Bir” in Vorzel town, which has long been unprofitable and not used by the agency. The Ministry of Defense is preparing to transfer for privatization three hotels, which have also been unprofitable for at least the last four years.

“But not all balance holders are in contact and ready to transfer non-core assets for privatization. In many cases, stakeholders do their best to continue to generate losses for the country by profiting from state property. Only the political will of the government, publicity and public support make it possible to work effectively with balance holders to transfer their non-core assets for privatization,” said Kostiantyn Koshelenko.

Hlib Kanevsky, Head of StateWatch, who was present at the event, said that in 2020 his organization analyzed 7 non-core state-owned enterprises on the balance sheets of various ministries. The total profit that these enterprises received during the year is only UAH 149 thousand, while the total loss exceeds UAH 22 million, and the total of all accounts payable of these non-core SOEs is UAH 115.2 million.

In turn, Head of political affairs of the Kyiv School of Economics, First Deputy Minister of Economy 2019-2020 Pavlo Kukhta reminded that the State Property Fund in 2021 plans to attract UAH 12 billion from privatization to the State Budget. At the same time, according to him, even more important are the investments that the new owner invests in the acquired object, creating new jobs and in a such way contributing to the economic growth of the country.