The New Privatizations Fund of Greece

Print this page

The recently voted Law 3986/2011 entitled ‘Urgent measures for the application of the midterm framework for the fiscal and financial Strategy 2012-2015’ (the ‘Law’) is the latest and most resounding effort of the Greek government to persuade its creditors that it is determined to tackle its public debt crisis. Its most significant innovation is the establishment of a Fund for the selling-off of assets belonging to the Greek state (the ‘Fund’).

In particular, the portfolio of the Greek State comprises four different categories of assets: (a) public enterprises; (b) infrastructures; (c) state monopoly rights, and (d) real property. Such assets are to be ‘exploited’ pursuant to the -so defined in the Law- Operational Strategy for the exploitation of the assets of the Fund, a programme to be elaborated in accordance with the provisions of the midterm framework  for the fiscal and financial Strategy 2012-2015 (the ‘MF’), divided into indicative quarterly goals.

The MF predicts an aggregate income of 50€ billion for Greece within a period of five years (2011-2015) through a series of privatizations. The goal is to sell off these assets openly and transparently, in a fair market price –and the hope behind this effort, to decrease public debt by 20% of the GDP. Starting from the second quarter of 2011, the privatizations programme includes a vast number of state activities -some of them reserved until now for the Greek State solely:

1. transport and infrastructures;

2. ports;

3. water supply and sewerage services;

4. betting and gaming;

5. the energy sector;

6. telecommunications and postal services;

7. defense industry;

8. banking industry;

9. mining enterprises and mines;

10. real property.