The reputed Wall Street Journal while acknowledging vision of Prime Minister Nawaz Sharif to privatize Pakistan’s state-dominated failing enterprises, hoped progress in this regard would help the country overcome its economic ills. The paper stated that Prime Minister Nawaz Sharif who took office last summer in country’s first transition from one elected government to another has the opportunity to deliver on a longstanding promise to privatize.
The paper mentioned the 49% rise in Pakistan’s benchmark stock index in 2013 and expressed the belief that more economic good news will follow this year, if Sharif can deliver on his privatization promise.
In a write up on its Opinion page – Pakistan Privatizes for Growth; Nawaz Sharif’s chance to reform a state-dominated economy stated that though Pakistan faced numerous problems; from terrorism and lawless territories to power shortages and polio, privatizing “state-owned dinosaurs” wasn’t the sole solution.
“But the sooner Islamabad can stop hemorrhaging 500 billion rupees (nearly $5 billion) annually on budgets, subsidies and bailouts for failing enterprises, the better,” the paper said.
Spurred by a $6.6 billion loan from the International Monetary Fund, Sharif’s government committed in September to begin privatizing more than 30 public energy, transport and infrastructure corporations over three years. These include Pakistan State Oil, Pakistan International Airlines and Pakistan Steel Mills.
The process was being led by a 15-member privatization commission headed by Mohammad Zubair, formerly IBM’s chief financial officer for the Middle East and Africa.
The paper hoped that the process will move forward with the expertise and political independence; starting with partial privatization of Pakistan International Airlines by December.
The paper however mentioned that Sharif’s reforms will still face resistance from organized labor and Pakistan’s two major opposition parties.
Overcoming such opposition will be a challenge, but the prime minister has the economic arguments that can resonate. In September, Gallup Pakistan found 70% of the population in favor of privatizing Pakistan International Airlines.
