Almost UAH 3.3 billion - revenues to budgets of various levels from small-scale privatization in the ProZorro.Sale system in 2023
In 2023, small-scale privatization of state and municipal property in the state electronic trading system Prozorro.Sale replenished budgets of various levels by more than UAH 3.3 billion.
The State Property Fund (SPFU) received more than UAH 2.6 billion from online auctions for the sale of objects. Privatization of municipal facilities brought over UAH 650 million to communities. As a result of the electronic auctions, the price of the facilities has almost tripled.
"The key reforms for the Government and the Ministry of Economy during a full-scale war are those aimed at strengthening the economy and creating a transparent and efficient system for attracting investment. The reform of privatization of state and municipal property is one of them. In total, in 2023, businesses and citizens privatized almost 910 objects across the country. 355 of them were state property sold by the SPFU and its regional offices through online auctions on ProZorro.Sale, and another 555 were assets sold by communities. The proceeds from the privatization of these assets went to the state and local budgets. It is important that privatization is not only a one-time revenue to the state or local budget, it is primarily about attracting investment and economic development," said Yulia Svyrydenko, First Vice Prime Minister and Minister of Economy of Ukraine.
"Factories, hotels, warehouses, outpatient clinics, car dealerships - these and other facilities have found a new efficient owner this year thanks to online auctions. And the state and local budgets continue to make money from their assets even during the war. In 2023, more than 3.6 thousand participants competed for the right to purchase state and municipal property. The business demand for small-scale privatization objects in the second year of the full-scale war remains, and on average, the competition at the auctions was more than 3 bidders," said Sergiy But, CEO of Prozorro.Sale.
"Privatization is not only about budget revenues. It is also about new jobs, modernization, development, competitiveness and the development of new markets. Another equally important area of privatization auctions under martial law is the search for objects for business relocation. This is especially relevant for the hospitality industry (catering, restaurant business and hotel industry), agricultural, logistics and other sectors of the economy. That is why industrial and administrative assets are the most popular real estate objects, accounting for 81% of the sold property. Businesses are interested in the so-called brownfields - abandoned enterprises with communications. After all, it is enough to make repairs there and start your own business or expand an already running production. The SPFU plans to actively involve big business in privatization. We are already preparing the Big Privatization. We also plan to open a transparent agricultural land lease market and auction off the aggressor's assets to compensate for the damage caused by the war," said Vitaliy Koval, Chairman of the SPFU.
The highest price for the privatization of state-owned facilities in 2023 was paid by the winning bidders for the "Hermitage" hotel in Kyiv - UAH 311 million, the "Volyntorf" EMC - over UAH 212 million, and the "Ukroboronresursy" EMC - over UAH 210 million.
Among the communities, Dnipro was the most active in the small-scale privatization market, with 35 successful auctions, followed by Lviv - 32 and Kyiv - 23. The most expensive communal privatization objects this year are the Zhytomyr Regional Cinema Center for UAH 40 million, non-residential premises in Lviv with an area of 550 square meters for over UAH 25 million, and non-residential premises in Zhytomyr region with an area of almost 600 square meters for over UAH 22 million.
As of December 26, 2023, more than 150 small-scale privatization auctions are at the stage of closing deals and can replenish the state and local budgets by almost UAH 390 million.
For reference:
ProZorro.Sale is a joint-stock company 100% owned by the state represented by the Ministry of Economy. JSC Prozorro.Sale operates an electronic trading system in which online auctions for the lease and sale of public assets, including small-scale privatization objects, are held. Prozorro.Sale guarantees the security of the auctions, the impossibility of interference in their course and equal access of each participant to participate in the auction, as well as the ability of anyone to monitor online auctions and their results in real time.