Does Russia really want to give up shares of its state jewels?
Russia is preparing to sell off parts of its most valuable state-owned companies in a bid to raise funds and improve the state’s capitalization at a delicate time, including when oil prices are low.
Finance Minister Anton Siluanov confirmed on Friday that companies in the energy, transport and financial sectors are ready for privatization, as Moscow scrambles to finance a booming war budget and attract private capital for a post-sanctions economy.
No precise names have been given of the companies available for privatization. The risk is that the privatization will end up, as in the Rosfnet case, in a sort of round-trip transaction that does not change much from the point of view of real control.
The last time the Kremlin attempted this strategy, in 2016, it announced the sale of 19.5% of Rosneft's shares to Glencore and Qatar. However, several investigations and leaks suggested that the deal was financed internally through Russian banks, so in the end it was always public money, through other hands, that financed the privatization.
This time the reasons are no less urgent. The Russian federal budget is strained by military spending and falling energy and commodity prices, which have reduced some of the financial flows from abroad. Domestic loans carry a punishing 20% interest rate, making privatization one of the few remaining tools for raising capital, at least on paper.
However, skepticism runs deep. The state has promised privatization in the past, only to delay or dilute it when the political situation or prices became unfavorable.
And even if the stakes were sold, few expect a significant transfer of control. The Kremlin is unlikely to loosen its grip on strategic assets such as oil, gas and banks.
The move could generate short-term liquidity and some euphoria on the stock exchange and Russian markets, but without an interruption of sanctions and the resumption of financial flows from abroad, even these privatizations would be cosmetic and, above all, would not generate the necessary monetary flows. The peace negotiations, which should see a new round of meetings scheduled for next week.
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The article Does Russia really want to sell off shares of its state jewels? comes from Scenari Economici .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/russia-putin-privatizzazioni-guerra-soldi-bluff-aziende-stato/ on Sun, 22 Jun 2025 07:00:02 +0000.