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Medvedev Wants More Privatization

President Dmitry Medvedev on Thursday ordered the Cabinet to sell off more government stakes in successful companies to private investors over the next two years.

The Cabinet must submit proposals for increasing the number of “major … strategic companies that are attractive for investment” in its privatization plan by March 15, the Kremlin said on its web site.

The current plan, which Prime Minister Vladimir Putin signed in November, already seeks the sale of stakes in several strategic companies, such as shipper Sovkomflot. Medvedev has the responsibility of striking these companies off the list of strategic assets for the stakes to change hands. He hasn't approved their exclusion as yet.

Medvedev's order for a greater sale of key assets comes after he conferred with officials last week about ways to encourage investment — and as the government is facing a budget deficit for a second straight year.

The instruction to sell more stakes in major companies didn't identify them by name. A call to the spokesman for First Deputy Prime Minister Igor Shuvalov, who is in charge of privatization and investment, went unanswered Thursday afternoon.

The list of strategic companies contains such potentially alluring assets as the airline Aeroflot, television company Channel One, telecoms operator Svyazinvest, oil producers Zarubezhneft and Rosneft as well as oil pipeline monopoly Transneft. Cabinet officials last year ruled out selling more stock in Rosneft, however.

Medvedev also instructed the Cabinet to come up with a proposal to punish more severely those bureaucrats that hamper investment, probably targeting those engaged in corruption. The Kremlin didn't elaborate on the measure.

In another order, Medvedev said the Cabinet must suggest amendments that would cancel the profit tax for firms that have health care or education as their core business.

He also told the government to draft bills that would simplify customs clearance and allow high-tech or research companies to use easier visa procedures.

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