Could Land Privatization Help Greece?
Greece’s international lenders are sponsoring a plan for the country to transfer state-owned real estate to a private holding company, Reuters reports.
The lenders advocate setting up a holding company in Luxembourg in order to capitalize on lower tax rates and then focus on improving for-sale plots of land to make them more attractive to buyers. The value of the properties that the company would stand to acquire could be as high as 28 billion euros. The company could also issue securities backed by the assets as an additional source of money.
This comes after promises by Greece to raise capital floundered when the sale of its national utility company found itself with no bidders, leaving the country with only 5 billion euros raised toward its initial 50 billion euro goal. Another fiasco occurred when the head of the Greek privatization agency was found to have been using an aircraft privately owned by the head of a business that had purchased land from the agency.