Business Community Urges Govt To Privatize Loss Incurring SOEs

Muhammad Irfan Published August 04, 2022 | 02:00 PM

ISLAMABAD, (UrduPoint / Pakistan Point News - 4th Aug, 2022 ) :The business community Thursday urged the government to privatize all state owned enterprises (SOE) incurring heavy losses to national kitty for decades.

Talking to a delegation of industrialists and traders led by Waqas Anjum ,CEO Pakistan Furniture Council Mian Kashif Ashfaq said that the manifestos of almost all the mainstream political parties throughout the country always advocated divestment of government stakes in SOEs to curtail losses and reduce government footprint in business but not yet materialized even after long span of time spreading over half century.

He was of the view that these SOE cost losses to the state of over 4.5 percent of GDP, according to 2018-19 estimates,including almost 2 percent of GDP on account of only three entities PIA, PSM and Pakistan Railways.

While another 2 percent of GDP worth of guarantees are provided by the government to keep them floating, he observed.

Another dilemma is that finally the previous government could finalize by March 2021 a triage of 85 out of a total of 212 public sector companies for their ultimate privatization, liquidity or retention in the public sector.

The overall revenues of all these 85 SOEs in 2018-19 amounted to about Rs 4 trillion while the book value of their assets stood at Rs 19 trillion and yet caused about Rs 287 billion losses in 2017-18, he added.

Mian Kashif Ashfaq said another targeted 24 companies in pipeline for sale in next phase between 2023-24 must also be placed for transparent privatization.

He said it's established fact worldwide that business activities are always carried by private sector not public sector as private sector employ best possible ways to run in profit earning entities through good governance and timely decision on the spot also does matter rather than lackluster attitudes in public sector.

He emphasized the need to offer packages of incentives to buyers of loss causing SOEs to run efficiently.