IMPOVERISHED SERBS EXPECTING WINDFALL FORTUNE
by Vesna Peric Zimonjic
(IPS) BELGRADE-- Going by official media, the Kosovo dispute seems to top the nation's agenda. But Serbs have their mind more on visions of free wealth that they believe will be theirs, after the Law on Free Distribution of Shares came into force last week.
The law provides for free distribution of 15 percent of shares of six state-owned entities, the family silver of Serbia, due to be privatized by the end of 2008. These are the Oil Industry of Serbia (NIS), Yugoslav Airlines (JAT), Electricity Production System (EPS), Telecom Serbia, the Belgrade Airport Nikola Tesla, and the pharmaceutical company Galenika.
Under the privatization law, an additional 15 percent will go to 150,000 employees, the state will keep 21 percent, while 49 percent will be sold, supposedly to international companies.
"This means that each of the four million (adult) citizens of Serbia will have at least 1,000 euros in his or her pocket," economy and regional development minister Mladjan Dinkic told reporters.
His estimate was based on the assumption that the six companies could be sold for more than 12 billion euros ($18 billion), an amount much disputed among experts.
"That is only the hypothetical value, the real one will only be seen once the companies go on sale," economic expert Danilo Sukovic told IPS.
It also remains unclear how many shares, in the form of coupons, a person will get, and of which company. NIS is the most prosperous of the lot, while JAT and Galenika are not so successful.
The move is disputed for several other reasons. "Not all the four million created the value of companies that will go on sale," finance expert Danijel Cvjeticanin wrote in Politika daily. "One generation will divide among itself what generations before it had created. This was a hasty move, with a clear electoral purpose."
Serbia will hold presidential elections Jan. 20, when reform-oriented President Boris Tadic will stand against ultranationalist Tomislav Nikolic. Dinkic is a strong supporter of the Tadic bloc.
The distribution of the share coupons is due to begin Jul. 31. People will be required only to present an ID card at the nearest post office or National Employment Bureau office.
"The problem is that people hardly know anything about such privatization, and little was done to inform them," political analyst Misa Brkic told IPS. "Everybody thinks now that they'll get a thousand euros in cash or several thousand where families are concerned, and are already making plans what to do with it."
Economic recovery in Serbia began seven years ago after a decade of brutal wars of disintegration of former Yugoslavia. It has still not reached the development level of 1989, the last successful year before the wars. The average monthly salary is barely 500 dollars.
The media has done little to explain what might be at stake over the distribution of shares. The announcement was simply greeted with headlines such as "Thousand euros go into everybody's pocket" or "Everyone richer by a thousand euros." Critics of the plan have been given little space or time, despite the mixed results with such offers in other countries.
A similar move in the Czech Republic in the early 1990s was considered successful, but came under strong criticism later for fraud among other things. In Slovenia, the only ex-Yugoslav republic that is a member of the European Union, a similar move has been launched but not completed.
State-owned television invited minister Dinkic to explain the process last week, but the program was mostly taken up by audience calls on how much money they can expect.
Albion Monitor January
7, 2008 (http://www.albionmonitor.com) All Rights Reserved. Contact email@example.com for permission to use in any format.
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