Roscosmos: Space Agency should be turned into state corporation, then into joint-stock company

In order to sort out the space industry, the Russian Space Agency (Roscosmos) needs to be turned into a state corporation for a period of 5-7 years and then reorganized into a joint-stock company, Roscosmos head Vladimir Popovkin said in an interview in Vedomosti published on Monday.

"The state corporation is needed for a maximum of 5-7 years, in order to clean everything up, create several divisions that produce engines, rockets, satellites for near and deep space. Then it should become a joint-stock company and enter the normal market," Popovkin said.

A state corporation needs to be created in order to whip "the sector into a normal condition that would correspond to corporations such as Boeing or Lockheed Martin," he said, adding that "changes require a strong concentration of power."

"At present, Roscosmos can manage federal state unitary enterprises that can be counted on one's fingers, all the rest of the enterprises have become joint-stock companies. Both formally and legally they are managed by the Economic Development Ministry through the Federal Property Agency. […] In these conditions, it's impossible to make normal, systemic reforms," Popovkin said.

"In order to gather everything together, power needs to be given to those who will do all this. It can't be corrected otherwise," he said.

Roscosmos is working on a plan for modernizing the sector that would make it possible to dispose of all superfluous assets, but first it is necessary to restructure in order to then legally privatize selected assets.

"The capacity that existed in the Soviet Union is not needed today. There is a lot of obsolete technology that needs to be gotten rid of. It is also impossible to continue to maintain 242,000 workers with the industry using about 48 percent of capacity. The country can't feed them. There should be a maximum 150,000-170,000 people working in the sector," Popovkin said.

He also added that sufficient funding is currently being allocated for the space industry. "As much as the industry can digest. It can't digest more right now," Popovkin said.

He said Russia is nominally third in the world in terms of space funding. "We're third today. The United States, Europe and Russia. It's very difficult to understand where China is, because it's not known how much they spend. I think that they spend more than they say. That means we're fourth,' Popovkin said.

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