Media blackout on 'UkrTelecom' fix

Oleksandr Bondar, former head of Ukraine's State Property Fund, and journalist Tetyana Chornovil took part in the TVi channel's 'Vechir z Mykoloyu Knyazhytskym' programme tonight.

The topic under discussion was the shady, one bidder only, privatisation of the country's fixed line communications monopoly 'UkrTelecom'. [See my previous two blogs for background and more details].

The two studio guests complained of an almost total blackout on reporting or discussion of this massive privatisation in the Ukrainian mass media. TVi itself is a fringe channel, and Tetyana Chornovil's articles appear in 'Leviy Bereg' on the internet.

UkrTelecom, which employs over 30,000 personnel, is in debt. It may well be the loans were deliberately taken out and the money 'dark-holed' [as they say in England], with the intention of artificially depressing the value of the company. Now the sale has gone through, the money can be, allegedly, easily repaid.The CEO of Ukrtelecom, Heorgiy Dzekon, was in the past, according to Bondar, against any privatisation, even at a price of $2Bn. But now Yanukovych is president, he supports the company's sale at $1.3Bn.

Bondar, a parliamentary deputy, claims the talk in the VR's corridors is that UkrTelecom has been purchased by head of the presidential administration, Serhiy Lyovochkin, the entire deal being bankrolled by RosUkrEnergo's Dmytro Firtash..

Bondar adds that UkrTelecom's fixed line network is of strategic importance to the security of the country . It is used by the country's security services, police, by financial and governmental institutions etc. It is totally unacceptable that the owner of such a communications company is not officially known.

Karl Marx knew what he was on about when he said, in October 1917, "Our..forces must be so combined as to occupy without fail, and to hold at any cost, (a) the telephone exchange, (b) the telegraph office, (c) the railway stations, (d) the bridges.."

A request to investigate this privatisation further, in parliament, was declined today...The response of the president and government to this scandalous affair seems to indicate it took place with their blessing.

More on 'UkrTelecom' fix

Investigative journalist Tetyana Chornovil, in an article in "Leviy Bereg", provides more circumstantial evidence that the privatisation sale of 'UkrTelecom' to Epic Service Ukraine (ESU) for $1.3Bn [see previous blog] is, most likely, a fix*.

Summary:

The CEO of Ukrtelecom at the time of sale, Heorgiy Dzekon, and the director of ESU, Illya Solodovskiy, are neighbours in the posh, [what the British call stockbroker belt] village of Lisnyky, near Kyiv. This pair, together with one Ihor Zimin, the father of VR deputy Yevhen Zimin who is head of the parliamentary committee on telecommunications and postal communications, jointly own land together through their company 'Novi Lisnyky'.

The younger Zimin, even though he is a BYuT VR deputy, is considered to be close to Serhiy Lyovochkin, head of the president's administration.

In 2004, when Heorhiy Dzekon was appointed head of 'UkrTelecom', the company was making 759 Million hryven profit. Since then, Tetyana Chornovil alleges the company has been systematically run down and devalued, i.e. "prepared for privatisation", by Dzakon. It is now in debt and on the verge of bankruptcy.

Dzakon and Lyovochkin go back a long way. They can allegedly be heard on recordings, revealed by Oleh Rybachuk, plotting to tap into the electoral commission network to rig the 2004 presidential election results.

There is some hope though - questions are to be asked in parliament on Friday..

p.s. There are nine telecoms companies in the world bigger that Microsoft and bigger than ArcelorMittal, the biggest steel company in the world. Telecoms is a big deal all right, now and for the future.

*fix - Informal . to arrange or influence the outcome or action of,especially privately or dishonestly..