LAHORE MIRROR — The Pakistani government is actively working to enhance the efficiency and coordination of state-owned enterprises (SOEs) as part of its commitments under the International Monetary Fund (IMF) bailout program.
To this end, it has identified ten SOEs for a comprehensive restructuring.
These measures are essential as the losses incurred by these SOEs are straining the national treasury, and the $3 billion IMF bailout package is crucial to preventing Pakistan from defaulting on its sovereign loans.
During a press conference in Karachi, Caretaker Finance Minister Dr. Shamshad Akhtar disclosed that by the end of 2020, the cumulative losses of these SOEs had reached 500 billion rupees, approximately $1.74 billion. Under the government’s proposed policy, directors for these SOEs will be appointed through a nominating process, and no ministry will have the authority to issue directives concerning governance improvements at these entities.
Furthermore, Caretaker Minister for Privatization, Fawwad Hassan Fawwad, noted that Pakistan Steel Mills (PSM) now has only one remaining bidder. He explained that prior to the COVID-19 pandemic, four companies had expressed interest in bidding for PSM, but three, including major global steel firms, withdrew for various reasons.
Fawwad, who also serves as the Adviser to the Prime Minister on Commerce, revealed that the government is engaged in discussions with financial planners regarding the transaction of several state assets. He clarified that these discussions specifically pertain to the sale of operational assets of Pakistan Steel Mills.
Pakistan is also exploring the possibility of outsourcing various state-owned assets to external companies. Earlier this year, it initiated the outsourcing of operations and management of three major airports and ground facilities through public-private partnerships to generate revenue for its struggling economy.
In the fiscal year 2024 budget, the government has allocated a modest sum of only 15 billion Pakistani rupees, approximately $52.42 million, for privatization receipts. This allocation reflects the economic challenges brought about by the pandemic, which have had an impact on privatization efforts.
