Serbian Govt Criticised Over Telecoms Sell-Off

The Democratic Party of Serbia and the right-wing movement Dveri said on Friday that government's decision to sell Telekom was "scandalous", insisting there was no economic reason for selling a company that earns millions of euros annually.

"Selling Telekom would lead to mass sackings, which we have seen happen in the region. We demand that the decision of selling Telekom be cancelled," the parties said in a join press statement.

The Serbian government announced on June 25 that it had ordered the economy ministry and Privatisation Agency to launch the Telekom sell-off.

Announcing the decision, Serbian Prime Minister Aleksandar Vucic said that the sale of Telekom would depend on the price and the government would not sell it unless enough money is offered.

He also said that money from the eventual sale of the company would not be spent on covering the budget deficit, but in investment and infrastructure projects.

A Belgrade-based investment expert, Mahmud Busatlija, said however that he also believed the planned privatisation was illogical.

"Telekom is being sold only because of poor management. There is no public interest in selling Telekom, since it's making a lot of profit. Selling it will be very dangerous for Serbia and its citizens," Busatlija told BIRN.

Busatlija also said that Telekom holds an effective monopoly of fixed telecommunications in Serbia and by selling it, the state would put the monopoly in private hands.

"If Telekom is sold we will see a lot of people getting sacked. Prices could jump, because there will be no competition on the market. There will not be major investments made because the shareholders will only be seeking profits," he said.

Telekom is the most profitable state owned company...