PRIVATIZATION AGENCY IN PERU MOVING QUICKLY TO MEET GOAL

PRIVATIZATION AGENCY IN PERU MOVING QUICKLY TO MEET GOAL

Carlos Montoya, head of Peru's privatization program, is trying to make up for lost time as he moves his country into the mainstream of private enterprise.

"At one time the state participated in 35 percent of the GDP (gross domestic product). Our prediction (after privatization) is for 5 percent," said Mr. Montoya in a recent Journal of Commerce interview here.Some of the 230 companies officially listed as privatization candidates already have been sold. "The goal is 1995 for completion," Mr. Montoya said.

Copri, an independent commission established by presidential decree in October 1991, has moved quickly on its mandate to carry out the privatization program.

Unlike its counterpart in other countries, Copri makes the final decision on a sale. The Peruvian Congress, meanwhile, keeps abreast of proposed sales through frequent hearings.

Privatization should bring in between $1.2 billion and $1.5 billion by the end of first quarter 1994, Mr. Montoya said. To date, Chinese, Canadian, U.S., European and Japanese companies have been involved in bidding.

"The Japanese have been bidders, especially in the mining sector. Their participation is expected to be through joint venture partnerships in mining," Mr. Montoya said.

The privatization law provides that 10 percent of the companies be offered to the workers, Mr. Montoya said.

"They have the right of first refusal. We (soon) will start a micro- capitalism program for smaller savers. We want 100,000 people to become shareholders by way of privatization," he said.

Key companies still to be sold include: Petroperu, the state oil company; Enafer railroad; Enapu port operations; Popular & Porvenir insurance; Banco Continental; Interbanc; and Epsep, which operates cold-storage plants.

Some sales, such as those involving transportation infrastructure, will require longer review. Copri expects, for example, to spend much time studying a port privatization plan to be delivered this month by Enapu (Empresa Nacional de Puertos S.A.)

Meanwhile, Copri is reviewing bids from Dutch, Italian and U.S. ports for participation in the upcoming port privatization project, Mr. Montoya said.

Similarly, airport privatization will be slow.

"We are slowly privatizing the airport. We've already privatized the ramp services and peripheral services. The next thing is the navigational system. And the warehousing situation at the airport is being assessed," he said.

Plans for airport privatizations are being developed by Corpac (Corporacion Peruana de Aeropuertos Y Aviacion Commercial).

Privatization deals to date have included severance packages and employee buyout options. Some 150,000 jobs have been affected, Mr. Montoya said.

SCHEDULE OF PERUVIAN

COMPANIES FOR SALE THIS YEAR

Cementos Yura Construction November

Reaseguradora

Peruana Insurance November

Cerper Fishing November

Ilo Copper Mining November

Complejo Agronimo

del Chao Agriculture November

Paramonga Chemical November

Corpac Airports November

Cementos Lima Construction November

Centromin Mining December

CPT and Entel Telephone December

InterBanc Banking December

Electrolima Utility December

PescaPeru Fishing December

Mina Mishki Mining Unscheduled