Privatisation of state-owned companies is part of Cyprus’ economic adjustment programme – a set of economic and administrative reforms – agreed with international creditors in 2013 in exchange for a €10 billion emergency bailout loan, in order to raise €1.4 billion by 2018.

According to the Finance Ministry’s privatisations roadmap, 2015 will see the denationalisation of CyTA, the Cyprus Ports Authority and the sale of rights to a casino, lottery and VLT (video lottery terminal) machines. 

Although for both CyTA and the CPA the process is still in its preparatory stages, the pre-qualification of interested investors must be completed by the end of the first quarter of 2015, one step before the submission of binding offers.

Also the end of this year’s first quarter should see the conclusion of the pre-qualification phase of investors interested in the construction and operation of a casino in Cyprus.

Within this year, the privatisation process will also be kick-started for the Cyprus Stock Exchange, the Cyprus Forest Industries, the Cyprus State Fairs Authority, and the Pancyprian Company of Bakers. These are expected to be concluded by the first quarter of 2016.

Last week, the announcement by Privatisations Commissioner Constantinos Herodotou that Citigroup Global Markets Ltd and PricewaterhouseCoopers were selected as financial and accounting advisors, respectively, in the effort to privatise CyTA rekindled the passions that first surfaced when the privatisations bill was being voted in parliament last September.

On Wednesday, CyTA’s four employee unions joined forces and warned the government that they would oppose any efforts to press ahead with the company’s privatisation unless the unions were engaged in dialogue, per the provisions of the privatisations law.

“The handling of the organisation can be likened to the handling of Cyprus Airways,” the unions said, alluding to Cyprus’ failed national airline, which was closed down earlier this month.

“We will dynamically oppose any attempt to hurt the interests of the organisation, its employees and the Cypriot citizen, to whom CyTA belongs.”

The unions announced a 15-day moratorium on any action, giving the government a chance to set up the joint consultation committee that would include them in decision-making for the privatisation process.

But employee opposition is unlikely to have much impact on government policy, which can conveniently hide its pro-privatisation agenda behind the adjustment programme imposed by the Troika. This was evident during last September’s privatisation vote in the House, when a protest that came close to a riot outside parliament did not avert the voting of the law.

Source: Cyprus Mail