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. Last Updated: 07/27/2016

Chemical Sale Delay Slammed

KIEV -- President Viktor Yushchenko's suspension of the privatization of a leading chemicals producer sends an "extremely negative signal to investors" and threatens the 2008 budget, the Ukrainian government said Thursday.

Yushchenko, long at odds with his government, headed by his archrival, Viktor Yanukovych, suspended the sale of the Odessa Pre-Port Plant Wednesday, saying a new buyer could gain a monopoly and be able to squeeze out other chemical producers. "[The president] is deliberately creating a threat to the implementation of the 2008 budget, because he knows that, because of procedures, the sale of the Odessa Pre-Port Plant may not be concluded this year," the government said in a statement.

About eight companies from Ukraine, Russia and Canada are interested in the plant, according to the country's privatization agency, which expects the company to fetch far more than the $500 million starting price.

It said in August that it had provided documents for the sale to Russian firms Yevrokhim and Akron and Ukrainian companies Azot, DneprAzot and Chernihivske Khimvolokno.

The government plans for a budget deficit of 2.33 percent and hopes the sale of fixed-line operator Ukrtelekom, in the pipeline for 10 years, will help patch up the budget gap.

Sell-offs have become one of several issues around which the president and government have squabbled for a year.

So far this year, privatization revenues total 1.62 billion hryvnas ($320 million) against a planned 10.6 billion hryvnas at a time when politicians of all hues are promising higher social spending in the run-up to a parliamentary election.