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Article

Description

A detailed and rigorous exercise was undertaken to examine each SOE based on the ownership rationale and its financial performance as explained earlier, and all the commercial SOEs were categorized into two broad categories: (a) to be retained under state ownership; and (b) to be privatized or liquidated. The first category includes those performing core functions and fall within the scope of public policy framework. These SOEs are further sub-divided into two parts according to their financial performance: one, those which are profitable and financially viable – 25 SOEs were profitable in FY2018-19. Using a more stringent criteria to evaluate their financial viability four SOEs are categorized as financially viable – GHPL, Pak-Arab Refinery Company, Pak-Kuwait Investment Company and Pakistan Revenue Automation Ltd. Another 19 entities have been consistently profit making during the last three years; however, their ROAs have been lower than the threshold required. Another two SOEs – CPPA and Pak-Iran Investment Company – have positive equity and were profitable in FY2017 and FY2019. Although these SOEs are financially self-sustaining, their financial performance needs improvement through institutional reforms, like governance improvement through ownership and management policy, to be enacted as part of an SOE bill.

Publication Source

The News

Publication Date

5-20-2022

Pages

1-4

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