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Home > Privatization Alert - January 2009
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Privatization Alert - January 2009
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Focus: Privatization in Tourism
According to the United Nations World Tourism Organization, there has been a rapid slowdown of international tourism growth since mid-2008, reflecting the deteriorating economic situation of recent months. Tourism, as well as related sectors (travel, hospitality, real estate, supporting infrastructure), have long been at the mainstay of countries’ privatization plans. While state ownership of tourism assets was high up until the 1980s, it has declined significantly since then.
Nevertheless several privatization transactions in tourism were carried out in 2008, mostly by countries in Europe and Central Asia, but also in Africa. Many of them entailed the sale of properties, such as hotels and other facilities. A few others are currently under way or at the planning phase. For example, recent privatization deals in tourism have been undertaken by the Privatization Council of Montenegro, which plans to continue the process of divestment through public-private partnerships in 2009.
More recently tourism divestment has seen its evolution follow a model of public-private partnerships. Examples across the world abound, with recent announcements in India, the Middle East, Africa and South-east Europe and the Baltic States. The present economic environment has made the public-private partnership model even more attractive for promoting investment opportunities in tourism. As global foreign direct investment is drying up, greater effort is also placed in attracting ‘diaspora’ investors to tourism projects, exemplified recently by calls for non-resident Indians to invest directly or through public-private partnership in Kerala’s tourism sector.
Status and upcoming transactions
Europe and Central Asia:
Turkey has extended the deadline for the privatization of the National Lottery to April 15, 2009. Kosovo's newly formed Privatization Agency is planning to launch the tender for the ski resort Brezovica. Serbia is still looking for buyers for more than 600 enterprises, for which nearly a half face almost imminent liquidation or bankruptcy. Since the beginning of the privatization process, more than 1,800 enterprises have been sold, raking in close to 2.3 billion euros, along with 1.4 billion euros in pledged investments. The Czech Republic has launched the privatization of the Czech flagship carrier Ceske Aerolinie AS.
>> Complete list of regional project opportunities
>> Detailed country analysis by region
Middle East and North Africa: United Arab Emirates' Emirates Telecommunications Corp. announced that its consortium with Taameen Telecom (Iran) has been awarded Iran's third nationwide mobile license.
>> Complete list of regional project opportunities
>> Detailed country analysis by region
Sub-Saharan Africa: Nigeria has shortlisted 17 prospective investors who have applied to acquire 51 percent of Skypower Aviation Handling Company(SAHCOL). Uganda is expecting to complete the divestiture of its share in Kilembe Mines Ltd. by the third quarter of this year. That sale has been delayed partly due to the current economic situation. Kenya passed last year a new legal framework for public sector participation in the provision of public services, under which the sale of Kenya Pipeline Company and Consolidated Bank of Kenya will take place.
>> Complete list of regional project opportunities
>> Detailed country analysis by region
East and South East Asia: Indonesia has dropped its plans to privatize its national carrier Pt Garuda Indonesia. Vietnam is planning to privatize in 2009 one of its largest mobile phone operators, Mobile Telecom Service Company, as well as the Bank for Investment and Development of Vietnam.
>> Complete list of regional project opportunities
>> Detailed country analysis by region
South Asia: Pakistan's Privatisation Commission is in the process of revamping its privatization policy and the list of entities slated for divestiture. The new policy will focus on public-private partnerships aimed at improving efficiency, bringing in new investment and generally increasing the value of the state’s shareholdings. Pakistan is reported to be in the process of resolving outstanding issues related to the sale of immovable assets of Pakistan Telecommunication Co. to Emirates Telecommunication Corp.
>> Complete list of regional project opportunities
>> Detailed country analysis by region
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