Plan Would Privatize Russian Aviation

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Last summer, Russia's government asked the country's aviation industry to come up with a plan to grow more competitive, and this week, The Moscow Times reported that it has seen a draft of that plan. The draft calls for privatization of the industry as well as consolidation, and would create a consortium known as the Unified Aircraft Building Co., which would be similar to EADS, the European Aeronautic Defense and Space Co. The consortium would emerge by 2007 and would include such manufacturers as Sukhoi, MiG, Irkut, Ilyushin and Tupolev. About 75 percent of the industry would be controlled by private capital, the Times said, with the state holding on to 25 percent, and the consortium could ultimately claim about 10 percent of the global aerospace market. Under the proposed timeline, a consortium of Sukhoi, MiG, Ilyushin, Irkut and Tupolev would be created next year. If Russia fails to change, the draft says, the nation will face a "threat to lose its status as one of the global aircraft manufacturing centers in the mid-term future." Konstantin Makiyenko, deputy head of the Center for Analysis of Strategies and Technologies, told the Times the reform program is ambitious, even revolutionary. "I would applaud the plan, especially in the part where the state will only have a blocking stake in the corporation," Makiyenko said. "If completed by 2007, [the aviation reform] will mean not only a revolution in the governmental policy, but also in Russia's bureaucracy." The plan was discussed last week at Rosaviakosmos, the Russian Aviation and Space Agency.