Congo-Brazzaville approves bill for privatisation of oil industry

Aug 03, 2001 02:00 AM

The government of oil-rich Congo-Brazzaville has approved a draft bill that allows the privatisation of a state company in charge of the sale and distribution of oil products, an official said. Government spokesman Francois Ibovi said the draft law, approved by President Denis Sassou Nguesso's cabinet, will change regulations relating in particular to downstream activities such as refining and the import, export, transport, distribution and marketing of oil products.

Current policy, under which downstream activities are in state hands, is dictated by a law that came into effect in May 1997. Under deals agreed with international financial institutions, the Congo-Brazzaville government has to privatise HydroCongo, the company in charge of marketing and distribution of petroleum products, by September.
HydroCongo is to be sold to two international companies, French-Belgian oil group TotalFinaElf and Shell. A third, unnamed, company is also in the running for a stake. The new bill allows the drafting of regulations that will allow private companies to invest in the downstream sector, and envisages an advisory technical committee charged with finalising the minutiae, particularly as regards taxation and customs.

The bill will be forwarded to the National Transitional Council for adoption, Ibovi said. Last month, the International Monetary Fund (IMF) scolded the government for excessive spending, massive customs fraud and the slow pace of privatisation, saying the country could not yet qualify for debt relief.
The country's lagging economic performance, the slow rate of privatisation and spending on a civil service which employs 71,000 people, were factors impeding relations with international financial institutions, the IMF said.

Source: AFP
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