Completing the privatization process

Every government in this country from the mid seventies declared privatisation as among its list of priorities. But actual accomplishments in privatisation, i.e. identifying the industrial and services units in the public sector for privatisation, calculation of their assets and liabilities, bid prices for their disinvestment and finally disposing them off to buyers in the private sector, continue to be avery slow processes.
Thus, the outcome of privatisation efforts after nearly four decades of the start of the process in Bangladesh is not an impressive one. Butthe consequences of a unwieldy public sector in the context of Bangladesh is too transparent. The state owned enterprises (SOEs) are the single biggest drain on the country’s economy. A lion’s share of public resources are required annually to keep them artificially afloat in the economic sense. Under the rules of viable operations or loss and profit, these SOEs becamevery eligible for closure many years ago. But they were kept alive by continuous massive injections of funds in them over the years at the cost of denial of suchfunds for capacity building or infrastructures by the government in support of private sector activities.
The nationalised commercial banks (NCBs) hold a lion’s share of deposits from the people. Buta major share of the resources of the NCBs has been stuck up as classified loans taken by the SOEs. The chances of the SOEsevery repaying these loans is almost zero. Thus, the SOEs are a threat to the country’s financial sector or the banking system.
There is no way for the economy to move forward sustainably till the privatisation need is addressed adequately and effectively. The carrying out of privatisation to a conclusion will make the economy streamlined, add tovitality in the financial sectors and create the conditions for greater availability of resources in the hands of the government for economy supportive activities in different areas. More important would be theenvironment of competition to be created by privatisation. Presently, the consumers of the goods and services of the SOEs are suckers as in most cases they are forced to pay unreasonable amounts for their consumption. The price tag or service charge on a product or service from a SOE is arbitrarily imposed to cover its losses and unduly inflated production or delivery costs.
In a privatised situation, the private producers of goods or operators of services would be keen to ensure lower costs of production or operationrespectively.Besides, they would be also in a keen contest to steal a march over each other by delivering relatively better quality goods and services to their consumers at lower prices. From such competition, consumers would certainly gain in terms of quality and price.
The long standing benefits of privatisation are seen as varied and ample. Successful privatisation releases taxpayers’ money for better use and stops the ceaseless drain in the form of subsidies which the people actually pay for inefficient enterprises and the burden to buy their goods and services atundeservedly raised prices and charges. The rearing of the white elephants in the public sector is at the cost of insufficient or reducedspending in vital sectors such as health, education, communication, etc., and the consequent ill effects of the same in curtailing overall economic growth. Lack of privatisation leads to a stagnant economy. The entire population has to suffer the misuse of resources or the corruption of a tiny fraction of thecountry’s workforce engaged in the public sector industries and services.
Therefore, there must not be any rethink as regards privatisation nor should privatisation proceed in a namesake or lackadaisical manner just to make a point with the donors. Privatisation must be accorded the highest priority and pushed through decisively.