It is the government that will bemaking the decision,” said Maciej Wewior. [ID:nWAR008578] The treasury ministry’s spokesman said that it was possible to raise theplanned 36.7 billion zlotys from sell-offs without privatising KGHM He alsosaid the decision was not with the government. Following a stern “no” from Deputy Prime Minister Schetyna, the ministrybacktracked by saying the plan was only a proposal, leaving it up to thegovernment to decide. Tusk threatened he would sack Treasury Minister Aleksander Grad if adifferent planned sale — of Polish Gdynia and Szczecin shipyards — did notmaterialise by the end of August.
The treasury’s sale plan is also opposed by the miner’s powerful unions,which fear deep job cuts and have threatened to go on strike if the plan goesahead. Tusk added on Friday that further privatisation of KGHM was not favourableat the moment, as the company could bring to the state coffers just as much individends in the next five to six years as it would from the stake sale. Poland floated the miner in 1997, maintaining acontrolling stake. “The political risk would be toohigh given that there are presidential elections in 2010 and parliamentary onesin 2011.” A sharp economic slowdown has already forced Warsaw to amend its 2009budget, widening the budget gap by half to 27 billion zlotys. Poland’s centre-right government vowed not to sell any of its nearly42-percent stake in KGHM, Europe’s No.2 copper producer, when it took officenearly two years ago. The government is to decide on privatisation plans at itssitting next week.[ID:nWAR008579] “It seems as though there will be no further privatisation of KGHM,” RobertMaj, analyst at KBC securities in Warsaw, said.
“Speedy privatisation does not seem beneficial from Poland’s budget point ofview,” Tusk told a news conference. “That’s why I will recommend exiting KGHMfrom the fast privatisation plans.” Warsaw aims to raise privatisation gains to avoid tax hikes in 2010, whenTusk is expected to run against conservative President Lech Kaczynski inpresidential polls. Tusk echoed Thursday comments by his deputy Grzegorz Schetyna, saying hewould rebuff the Treasury’s surprise proposal to sell between 10 and 41 percentin KGHM as part of a 36.7 billion zloty ($12.3 billion) privatisation plan. * Says will recommend not to sell KGHM stake * Says KGHM stake sale not beneficial for state budget By Agnieszka Barteczko (Adds treasury ministry spokesperson in paras 12-13 ) WARSAW, July 24 (Reuters) – Polish Prime Minister Donald Tusk on Fridayopposed the treasury ministry’s plans to sell its stake in copper miner KGHMKGHM.WA, pointing to a rift inside the government over plans to aid the ailingstate budget.
