The Voice of Mirza Xazar

Viktor Kozeny, a Czech businessman who made millions of dollars from his country's voucher privatization program in the early 1990s, in an exclusive interview with the RFE/RL Azerbaijani Service, urged Azerbaijani President Heidar Aliev to fulfill his promises made in 1997-1998 concerning the privatization program in his country. According to Kozeny, President Aliev and his son, Ilham, personally met with him and other members of Kozeny's investors group in Baku and encouraged them to buy vouchers from citizens.
Kozeny and his investors group intended to buy shares of the state oil company in course of privatization. The president's son, Ilham Aliev, is a vice president of the state oil company in Azerbaijan. "We have invested about $500 million in privatization checks in Azerbaijan," said Kozeny in his interview. But the Azerbaijani government decided in 1998 not to privatize the state oil company. Viktor Kozeny's $500 million worth of vouchers became worthless paper.
The U.S. investors have taken Kozeny to court, arguing that Kozeny deceived them about the risks of investing in Azerbaijan. Kozeny in turn claims that his partners, including former U.S. Senator George Mitchell and the U.S. insurance company AIG, knew of the risks of investing in Azerbaijan.
In an interview with RFE/RL's Azerbaijani Service, Kozeny said that not only he but some of his other partners at the time met with President Aliev and received the same assurances that the privatization program would be implemented:
" Well, we (the president and I) discussed a variety of issues. These issues all centered around privatization -- and obviously it was of great concern to us that the privatization is going to go through and that a sufficient and valuable asset will be privatized in the foreseeable future. (We were) given all the necessary assurances that this is the case. Besides myself meeting Mr. President, also one of our directors, Senator George Mitchell, met with him and confirmed the same," said Kozeny.
Shortly after the first part of the interview with Viktor Kozeny was aired, the newspaper "Alternativ," with close ties to the President's Office, reacted promptly, claiming that President Aliev or his son Ilham never met with Kozeny. The paper admitted Kozeny may have been tricked by some officials, but rejected his claim that President Aliev made any commitments to his group.
However, after the second part of the interview was aired, the same paper admitted that President Aliev meets with all foreign investors, but denied again that he made any commitment to Viktor Kozeny.
The head of the State Property Committee, Nadir Nasibov, who also was mentioned in Kozeny's interview as one of the high-ranking officials involved in the transaction in his interview with the local newspaper "Zerkalo," denied the accusations made by Kozeny. Nasibov refuted Kozeny's charges that the Azerbaijani leadership deceived him and his investors group.
Viktor Kozeny in his interview expressed optimism that he will win the court case and the Azerbaijani government will finally give up and let the privatization program go on, which means letting Kozeny use his $500 million in vouchers. It is still too early to argue whether this optimism that the vouchers bought in Azerbaijan will pay off is real, or surreal.
(Mirza Khazar, 20 July, 2001)