A senior Russian official outlined plans to sell off the republic's state- owned enterprises, but he said foreign investment will remain tightly controlled to keep businesses from being sold at give-away prices while the ruble is weak.

Anatoly Chubais, chairman of the Russian government's privatization committee, said restrictions on foreign investment are needed to prevent outsiders from buying up vast chunks of the Russian economy for a pittance."If the (convertibility) problem is solved, we will abolish limits to foreign ownership," he said. There is currently "no pressure" by the International Monetary Fund, under whose auspices a currency stabilization fund will be created, for immediate foreign participation, he added.

At current exchange rates, which can vary from 160 to 170 rubles per U.S.

dollar, a U.S. college student could make enough money during a summer vacation to buy a small factory here, Mr. Chubais said. The Russian Central Bank's market rate is 110 rubles per dollar.

Mr. Chubais said it could take 10 or 15 years to break up state monopolies. Russia plans a series of auctions and competitive tenders for companies, shops and other service industries, a plan that contrasts sharply with a Ukrainian idea to give state companies away to local residents.

One quarter of companies would probably be sold this year, although in the service sector this could rise to 70 percent.

Fears are strong here that foreigners will buy up Russia. But if privatization moves forward without foreign participation, some existing

investments in which Russian enterprises have a stake could be threatened.

"Certainly it's their political process; it's not necessarily intended to be a discouragement for foreigners," said Carol Patterson, an attorney with Baker & McKenzie here.

"But we, in advising investors, are faced with a difficult situation as to who they are dealing with and if those assets are subject to privatization. There is no blanket legal assurance that (privatization) does not apply (to existing investments)," she said.

The privatization issue here is at best a political hornet's nest, with very few converging views. For example, a new plan authored by Larisa Piashevo, a Moscow city privatization official, calls for a sweeping sell-off of state companies at nominal rates to workers. Unsold property would then be sold at auction.

Mr. Chubais criticized this plan saying it contradicts Russian legislation and is therefore illegal. It would "lead to chaos (with) thousands of complaints in court. We want rapid privatization, not sweeping privatization," Mr. Chubais said.