VILNIUS, June 14 (Reuters) - Lithuania’s government said on Wednesday it would push for more efficient and transparent management of state-owned assets, with the possibility of putting some up for sale in the future to cut its deficit.
The economy dropped 14.8 percent last year, the second biggest recession in the European Union, and the budget deficit deficit widened to 8.9 percent of gross domestic product (GDP).
The government published its first annual review of state-owned assets on Wednesday, saying it was aiming at more professional management of assets which it said had a potential market value of 18 billion litas ($6.63 billion).
“This is the start of structural reforms that will stimulate growth, increase competiveness and reduce the budget deficit,” Prime Minister Andrius Kubilius was quoted as saying in a statement on the government’s web site.
The statement said a responsible owner should “divest companies when there is no longer a reason for continued ownership”, but Kubilius said the main aim was to streamline the management of state-owned firms and learn from private business.
“The aim is not privatization or additional budget revenues, but learning the good practice of asset management from private capital,” he told journalists.
“It (privatization) will not come soon, we are in no rush...it’s a prospect of the next few years,” he added.
Among the biggest state-owned assets included Lithuanian Railways, Vilnius airport, Lithuanian Shipping Company, Lithuanian Post, gas utility company Lietuvos Dujos LDJ1L.VL, oil terminal Klaipedos Nafta (KNF1L.VL), power plant Lietuvos Elektrine LEL1L.VL and the power grid.
Lithuania wants to cut its public sector deficit to 3 percent of GDP by 2012 from 8 percent this year.
“The portfolio of commercial assets has a substantial potential for efficiency improvement and thereby an ability to contribute in a material way to the state budget,” the government added.
In 2009, the aggregated net turnover for the state-owned companies amounted to 2.4 billion euros ($3.05 billion) and the net loss amounted to 0.4 billion euros, the government said.
The return in dividends from the state-owned assets was a mere 13 million euros last year. President Dalia Grybauskaite, a former EU budget commissioner, has criticized the government for not making state-owned companies contribute more to the budget. (Reporting by Nerijus Adomaitis; Editing by Ron Askew)