President Blocks Odesa Portside Plant Privatization

Viktor Yushchenko issued a decree yesterday, suspending the Cabinet of Minister’s February 11, 2008 decision to privatize a 99.52% stake in the Odesa Portside Plant on May 6. The President’s decree says that Odesa Portside’s privatization threatens national security, and points out flaws in the privatization procedure. Vladimir Nesterenko: After a half-year of preparations to privatize OPP, the president’s move looks strange; the same reasoning could well have been applied several months ago. We also wonder if the move has more to do with politics than economics, which could better explain the President’s move to suspend other privatizations (four GenCos and Turboatom (TATM: BUY)).  The relationship between Yushchenko and Tymoshenko has been generally tense; yesterday Yushchenko blocked the change of three deputy heads of the State Property Fund, which was initiated by the Tymoshenko government. If politics is indeed behind these developments, Ukrtelecom (UTEL: HOLD) may be the next victim.