Islamabad, December 27, 2024 – The Policy Research Institute of Market Economy (PRIME) unveiled its draft privatisation policy for commercial, non-strategic State-Owned Enterprises (SOEs) under the Federal Government. The announcement was made at a press briefing held in Islamabad.
Dr. Ali Salman, Executive Director of PRIME, emphasized that the existing Privatisation Policy of 1994 is outdated and inadequate in addressing the government’s need to reduce its footprint in the for-profit sector. He stated, “Our proposed policy provides a comprehensive framework that aligns with contemporary economic challenges and offers a practical roadmap for effective privatisation.”
The proposed policy introduces a three-pronged strategy to streamline privatisation efforts:
- Strategic Disinvestment – Divesting government shares in SOEs through targeted measures.
- Asset Stripping – Monetizing movable and immovable assets of SOEs to improve fiscal space.
- Direct Sale/Auction – Ensuring transparency and competition in the sale process.
Addressing Fiscal Challenges
The policy highlights the urgent need for divesting the federal government from commercial ventures to improve fiscal management amidst an unsustainable deficit. Dr. Salman noted, “Over 98% of the federal government’s assets and nearly 100% of the losses within the SOEs portfolio are attributed to commercial SOEs. This underscores the critical importance of a robust privatisation policy.”
Mitigating Employment Concerns
Acknowledging the sensitive issue of overstaffing in government-owned entities, Dr. Salman stressed the importance of addressing workforce concerns. “Our policy advocates for equity-sharing options and targeted reskilling programs to support employees affected by privatisation. This ensures a balance between fiscal reforms and social responsibility.”
A Call for Action
Dr. Salman expressed optimism that the government will adopt PRIME’s policy recommendations to reinvigorate privatisation efforts. “The recent failures in privatising loss-making entities have been disheartening for the nation. We are presenting this policy draft to the Privatisation Commission and urge the Federal Government to act swiftly to unlock the potential of the commercial sector through competition, efficiency, and growth.”
