Seminar on performance of privatised enterprises opens

Accra, July 2, GNA - A total of 233 state owned enterprises were divested between 1991 and 1999 when the government started its privatisation programme.

Out of the number, 190, representing 81 per cent were divested to Ghanaians, with 20 being joint ventures between Ghanaians and foreigners whilst 23 were sold to foreign investors.

Dr Kwame Adom-Frimpong, of the Chartered Institute of Administrators (CIA) said this at the opening of a two-day seminar to discuss Ghana's privatisation programme and the performance of privatised enterprises.

The seminar, which was organised by CIA for its members was also used to introduce the types and techniques of privatisation available to the participants. Dr. Adom-Frimpong said by the end of the seminar, members would be able to describe the various privatisation techniques that could be applied by the state and explain why government decided to adopt the privatisation system.

He said though privatisation helps to increase the revenue of government, its negative effects on the country's gross domestic product, inflation, market competition, savings rate was enormous.

According to Mr. Adom-Frimpong, whilst some of the privatised enterprises were performing well, others were struggling to find their feet in the competitive market.

He gave some of the reasons why government divested state owned enterprises as political intervention, high cost of employment, high wage agitation by trade unions and insufficient consumer orientation.

He said government sometimes privatise profitable companies to ensure competitiveness and cost effective operation, generate positive cash flows for government to ensure the implementation of development projects, among other reasons.

Mr Adom- Frimpong said to be successful privatisation programmes should have clear objectives, sound strategy, well-defined plan, good management and strong commitment.

He said development of regulatory bodies to oversee and monitor the prices as well as the quality of various products could also be a measure to counter the negative impacts of privatisation.