The performance of state owned enterprises (SOE) in Namibia
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Date
2007
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Abstract
Parastatals play an important role in national economic development. They represent the extended arm of government providing key goods and services to the economy that would otherwise not be served by private enterprise as well as playing an important regulatory role. As a result they are set up with state funds-monies which might be misallocated because of the lack of timely reporting, monitoring, and scrutiny and often due to the limited enforcement of basis corporate governance principles
The financial performance of SOEs since 1993 has been disappointing in the majority of cases, with government expenditure on bailing out to SOEs increasingly significantly. Government expenditure on SOEs shifts away the resources from vital capital transfers towards the expenditure on salaries and wages. Therefore, many SOEs experience high levels of debt as well as declining levels of capital productivity
This study has revealed that management of SOEs are not entirely to be blame for the poor performance in the sector. If the head of a company such as Transnamib is told to run a railway line to the north that everyone knows will lose considerable amounts of money over the short to medium term, but which is deem as a "national priority", he is certainly not to be blame when the company makes a loss. Management in the SOE sector do not have much independence as their counterparts in the private sector. They would not have this autonomy unless they have significant private shareholders. Until that happens, real freedom to manage appears a distant dream in Namibia's SO sector.
Description
Submitted in partial fulfilment of the requirements for the Master of Public Policy and Administration
Keywords
Government business enterprises, Government ownership