A new study by Transparency International Georgia has revealed “insufficient transparency” in the privatisation of state property in the country throughout the years, and pointed at corruption risks in the process.
The report found over 1,000 companies that had received state property through privatisation in 2013-2020 included 217 individuals and 212 companies that donated GEL 19,655,907 ($6.6 million or EUR 6.4 million) to the ruling party in the reported period.
TI Georgia also revealed 68% of all privatisation auctions held from 2013 to 2020 were won by a single bidder, calling the practice “an extremely low level of competition” and noting the share of such auctions had not been decreasing in the country.
It also said a total of 429 direct privatisation contracts were completed in the reported period – with the exclusion of the year 2015 – of which 43% of agreements had a symbolic price of GEL 1.
“The state received a total of over GEL 236 million ($80.2 million or EUR 76.8 million) from direct privatisation. A large portion of this sum – GEL 157 million ($53.4 million or EUR 51.1 million) was related to the real estate transferred to SOCAR Georgia Gas LLC for gas pipeline construction”, the report reads.
The Georgian office of the international organisation also noted the National Agency of State Property had no “specific mechanism” to prevent corruption and conflict of interests in the state property privatisation process, referring to “suspicious cases” that could be pointing to corrupt deals.
The report also said despite the fact of privatisation auctions being held online, the level of competition remained “extremely low”, creating a “favourable environment” for corruption-related violations.
The organisation also highlighted issues related to information availability, saying it was not published “proactively” on relevant websites, with the names of auction participants being confidential and Government decrees not being made available. (Agenda/Business World Magazine)
