Thaksin's Bribery Along His Fugitive Path 4 (Montenegro)
( Last edit 2010-04-16 )
Citizen Thaksin to boost Montenegrin economy
by Sebastian Tong and John Stonestreet of Reuters, April 14, 2010
Montenegro will draw a direct economic benefit from granting citizenship to ousted Thai Prime Minister Thaksin Shinawatra, the Balkan country's finance minister told Reuters on Wednesday.
"He will benefit the economy by introducing new investors or investing himself," Igor Luksic said on the sidelines of an investment forum in London.
The one-time owner of English Premier League soccer club Manchester City, Thaksin was ousted in a military coup in 2006 and later sentenced in absentia to two years in jail for graft.
Since fleeing Thailand -- where "red shirt" protestors who support him have been orchestrating a campaign of civil unrest -- he has been seen mostly in Dubai.
Luksic said Thaksin's citizenship -- confirmed by Montenegrin officials in March -- was "probably" awarded in the middle of 2009, before Thailand requested Interpol help to apprehend its former leader.
Luksic said Thaksin was "considering some investments" but would not say what they were.
"If Mr Thaksin is going to invest in something, I'm pretty sure that it will be made public soon."
In February, Montenegro found itself at odds with the International Monetary Fund over the scale of its economic contraction last year, with the government insisting the economy had shrunk 5.3 percent, less than the 7 percent estimated by the Fund.
Luksic said on Wednesday that, if the tiny former Yugoslav republic sought IMF help, it would favour a standby facility over outright loans, with other funding sources expected to cover its financing needs this year and next.
Montenegro, which became independent only in 2006 after leaving its union with Serbia, is preparing to bring its debut global bond to the market late May or early June to raise around 200 million euros.
Lead managers of the bond will be announced next week and Linklaters has been appointed the legal advisor, Luksic said.
"In parallel with the Eurobond, we are also looking at opportunities at negotiating with the World Bank and the IMF," he said.
Montenegro is in talks for a development loan of 50 million euros ($68.3 million) from the World Bank as well as weighing the possibility of an IMF standby arrangement.
Both deals hinge on the country meeting conditions set by the multilateral lenders.
"We are now in final stage of new legislation on financial structural reforms and we will make final decision on an IMF deal as soon as that is done," he said.
"We don't think of that arrangement as a borrowing arrangement. It will be a standby one... (though) there is no a priori decision on whether to take or not to take an IMF loan."
On March 31, Standard & Poor's (S&P) cut the country's credit rating to BB from BB+ with a negative outlook, warning that pressure on public finances was rising due to the sharp economic slowdown and rising bad bank debt.
Luksic said an arrangement with the IMF, at a size of 100-200 million euros, would send a positive signal to investors that the European Union applicant country had "nothing to hide".
"We don't look at the IMF as the primary source of financing," he added.