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Decision not made to privatise Admarc—PC
By
Ephraim Munthali - 19-08-2002 |
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The Privatisation Commission (PC) has described debates on the merits and demerits of privatising Admarc as premature, saying no decision has been made to privatise the parastatal.
Briefing the press in Blantyre on Friday, PC executive director Maziko Sauti-Phiri said according to the divesture sequence plan, a decision on the privatisation of Admarc is not due until 2003, at the earliest.
Finance Minister Friday Jumbe and Reserve Bank Governor Elias Ngalande said in a July 19, 2002 Letter of Intent to IMF that the process of commercialising Admarc is already under way to prepare the parastatal for privatisation.
Secretary for finance responsible for economic affairs Maxwell Mkwezalamba told Weekend Nation recently that government will privatise Admarc so that it does not continue relying on government.
He said the process of privatising Admarc will start with commercialising the entity after a bill to turn the parastatal into a limited liability company to be presented in parliament next month passes.
Following the announcement, the Agriculture and Natural Resources Committee of Parliament advertised in the daily papers last week that it was inviting written submissions on merits and demerits of Admarc privatisation.
But Sauti-Phiri said granted the importance of the issue at hand, encouraging debate on the matter is a welcome development but said it was also important to make decisions in accordance with plans.
He said Admarc will not be privatised until a comprehensive study has been done.
“We cannot just wake up in the morning and say we are going to privatise such and such a company. Even if government approves, a privatisation study has to be done first. As the secretariat of the commission, we are saying encouraging the debate is a bit premature because there is no decision to privatise Admarc,” said Sauti-Phiri.
He said comments on the privatisation of Admarc have been simplifying the matter because they overlook the fact that the parastatal plays both a commercial and social role.
Sauti-Phiri said the challenge facing government before privatisation is to define a market structure based upon market pricing for the commercial activities conditioned by adequate competition.
He added that government will also have to find ways of confronting its social responsibilities for social activities and also develop a regulatory framework independent of undue interference.
Sauti-Phiri said it is too general to simply say that “we will privatise Admarc” because Admarc runs both commercial and non-commercial activities.
“With regards to the remaining critical social and strategic activities, you might be aware, no doubt, of the government’s intentions to hive these off to other structures within the government where the subvention costs will be more transparent, and it is hoped, would be supported by donors,” he said.
He said a government task force, chaired by the director of Public Enterprise Reform Monitoring Unit (Permu) has been formed with the mandate to take care of issues regarding the privatisation of Admarc. |
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