On this day in 1992, late President Boris Yeltsin signed a decree introducing a privatization voucher system as the first step towards capitalism.
All Russians received vouchers worth 10,000 rubles entitling them to a piece of government property estimated at 1.4 trillion rubles. In 1992, a flat with one or two bedrooms in Moscow cost about $1,000-3,000. The vouchers could be exchanged for shares in companies, used to buy securities in voucher investment funds or sold.
Today, one of the architects of the 1990s economic reforms, Anatoly Chubais, admits mistakes in the privatization campaign. He said the voucher funds were set up as classical investment funds that are now rapidly developing in Russia.
"But there were no professional managers at the time and the government was unprepared for controlling these institutions," the 52-year-old businessman and former first deputy prime minister, credited with creating the Russian oligarch, said in an interview with the respected daily Izvestia.
Eventually the majority of these funds amounting to 40 million privatization vouchers were misappropriated or closed, "the father of privatization" said.
Post-Soviet privatization has been criticized for the rapid pace of reforms, termed "shock therapy", which deprived millions of people of their lifetime savings and handed vast fortunes to a handful of well-connected oligarchs.
But Chubais said the main goal of privatization, private ownership, was achieved and this is why he said he would repeat the voucher campaign if he had a chance, but in a different way.
In March 2005, Chubais was targeted in a murder attempt when his car came under automatic gunfire near Moscow. Three military officers now stand trial in connection with the incident.
Sergei Smirnov, deputy head of the insurance risk department in Moscow's Higher School of Economics, said the voucher campaign was an ambiguous matter. "One cannot say that everything was done fairly then. Perhaps, it could have been done differently - not so quickly and more efficiently."
He said Russians were not ready to handle the vouchers. "In a sense, it was a deception," Smirnov said.
Opinion surveys say 29% of Russians chose to sell their vouchers, 21% invested them in voucher investment funds, 12% in shares and about 10% gave them to relatives.
Other opinion polls suggest almost half of Russians exchanged the vouchers for shares in their companies.
In all the privatization campaign, 95-96% of issued vouchers were used in some way, which is a good indicator, experts say.
Estimates suggest that the voucher privatization helped attract about $40 million worth of investment desperately needed by the Russian economy. About half of the money came from international financial organizations, the main of them being the U.S. Agency for International Development, the World Bank, and the EBRD.
