Wednesday, July 30, 2008

Between 1994-2007… $23 billion realized from privatization deals- …but not all went to Treasury- Winston Brassington

Between 1994-2007… $23 billion realized from privatization deals- …but not all went to Treasury- Winston Brassington
Kaieteur News. 30 July 2008

Between 1994 and 2007, in excess of $23 billion was realized from the privatisation of public companies and real estate. But not all of monies came directly into the revenue coffers.
Mr Winston Brassington, when asked about the deposit of the $360 million accrued from the sale of a plot of land to John Fernandes Limited, said that the money went to NICIL, a government holding company.
When monies go to the public treasury, Parliament must decide on its release. However, when it goes to another fund, there is no need for Parliamentary intervention.
According to figures released by the Privatisation Unit, yesterday, during the hosting of seminar on Government’s privatization and taxation policies and practices, between 2003 and 2007, the Guyana Office for Investment (GO-Invest) also granted some 285 companies concessions.
Up to 2002, 14 companies were either partially or totally divested while from 2003 in the second phase of privatization, 26 entities were privatized.
Yesterday’s event at Le Meridien Pegasus was hosted jointly by the Privatisation Union, GO-Invest and the Guyana Revenue Authority, and was prompted after several questions were raised earlier this year over the privatization of the Sanata complex to the owners of the New Guyana Marketing Corporation.
According to a Privatisation Unit report yesterday, from 2003 there were 99 transactions from 29 Government entities. These were broken down into 26 privatization deals, 46 real estate transactions, and 27 restructuring/wind-up deals.
Of the 26 privatisation transactions, four were not advertised with two of these ending up in an employee sale in the case of Guyana National Newspapers Limited and an employee/management buyout in the case of Surapana Farms.
Of the remaining 22, three were negotiated and finalized after inadequate responses from advertising. These include Linmine and Aroaima Mining Company/Bermine. Queens Atlantic Investment Inc was actually a fourth but the seminar made no mention of the QAII deals in the initial presentations.
According to the Privatisation Union, while proceeds from Phase 1 were more than $1.1 billion, gross proceeds from Phase Two exceeded $23 billion from privatization/real estate transactions between the period 1994 and 2007.
“Overall, the Phase 2 privatisation has been done in a transparent and open manner. The modes employed emphasized the continuation of the business in most cases. Considerable attention was given to optimizing value, investment, and employment.”
According to the PU, difficult businesses which could easily have been liquidated have been privatized saving thousands of jobs.
“A reasonable review of the privatization policy paper indicates a general achievement of policy objectives and intentions.”

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