Russia can no longer afford to wait for a market rebound, its economy minister said Tuesday, calling the budget situation "critical" and urging to restart a stalled privatisation drive.

The government is looking for ways to raise funds for the budget as its earnings dwindle due to low oil prices, with voices increasingly urging the sale of minority stakes in state-owned companies, carrying out plans put on hold since President Vladimir Putin returned to the Kremlin.

Speaking at a ministerial meeting, Economy Minister Alexei Ulyukayev said that Russia has been putting off privatisation plans for the past two years, as the market stopped growing, but that it no longer makes sense to keep waiting.

"Now we have come to realise that the situation is not going to change, that there is nothing to wait for," he said.

"The situation is critical for the budget, the general turbulence of financial markets does not give grounds for expectation of any rebound or restoration," he added.

"The challenge is to make high-quality, efficient deals in extremely adverse market conditions."

Privatisation in Russia is widely associated with controversial deals during the 1990s. The general public views those sales as having been rigged and leading to the robbing the nation's riches while most Russians saw their incomes plunge.

However some ambitious privatisation deals were seen through under the presidency of Dmitry Medvedev between 2008 and 2012, and privatisation has been increasingly brought up in recent months due to the economic slump.

Discussing the matter on Monday, Putin listed criteria for the new drive saying that privatisation must be "economically viable" and the government should "avoid selling stock for next to nothing".

He also said that "new owners of the privatised assets must be located in Russian jurisdiction".

His spokesman Dmitry Peskov on Tuesday told journalists that this does not rule out foreign investors, adding that "Russia is interested in getting new partners" but the deals should not go through any offshore companies.

Finance Minister Anton Siluanov last month said Russia may sell a 19.5 percent stake in oil giant Rosneft, while President Vladimir Putin mentioned national carrier Aeroflot.

Russia's Vedomosti business daily however was pessimistic about the renewed privatisation calls, saying in an editorial that "the authorities simply cannot say goodbye to property."
Source: AFP