When countries are suffering from financial crises or rising debt, the IMF and World Bank often emphasize the privatization of state-owned enterprises, utilities and social services, and market liberalization as a prerequisite for financial help. But sometimes, they promote privatization indirectly. Rich countries rarely help poor countries modernize and strengthen public services, working through international institutions such as the World Bank. But they often lead them to privatize and commercialize public services, a move they themselves would never do. The IMF has the power to declare countries creditable – or not. Countries must accept the terms of structural adjustment programs to receive the seal of approval.
The government of Pakistan has been raising the flag of privatization despite its failure at the global level. Despite the IMF and the World Bank’s claims of the Structural Adjustment Program (SAP) successes, it is widely accepted that SAPs have failed to achieve their goals. Both agencies have pushed millions of people into poverty around the world by promoting the same drastic but brutal “economic reforms” – including privatization, budget cuts, and labor “resilience” – regardless of local culture, resources, or economic context. regardless. Privatization began in Pakistan under the conditions set by the IMF and the World Bank. Failed privatization, mass unemployment and a completely inefficient and unaccountable political system continue. In reality privatization is nothing but a ruthless act of plundering the poor to settle the rich and the legal plunder of public property by some capitalist elements and multinational corporations.
In all, 31 enterprises, worth billions of dollars and highly profitable sectors such as oil and gas, banking and finance, power, industry and real estate, are up for plundering sales again in the name of privatization under IMF directives. Almost everything is being sold, be it banks, communications, roads, mines, electricity, oil companies, engineering companies or shipping companies. But does this privatization help reduce poverty, inequality and unemployment? The general belief that privatization results in higher levels of efficiency is not true, at least in the case of Pakistan. Privatization has slowed down social development.
Employees are protesting the sale of these companies. The corporate elite is pushing for privatization to ensure that they control all our means of subsistence. It is sad how governments have been promoting nepotism over the years in appointing the heads of these corporations and overstaffing these institutions. One of the major reasons for the downfall of these national institutions is one of appointments at the top, not the bottom as is commonly imagined. Current governments, whether political or otherwise, make these appointments. the failure of the incompetent and incompetent management deployed by political leaders to destroy public institutions and pave the way for plundering of those public properties; Something that is left with Pakistan. Under the guise of privatization, there is actually a plan to sell off huge assets of these unlucky entities. The sell-off comes at a time of debate about private versus public ownership of public entities, amid rising costs and concerns about poor performance.
Privatization policies and practices are the primary tools that have enabled transnational corporations and private elites to plunder the public domain for private gain. Pakistan now has one of the highest levels of wealth inequality in the world. Health care, transport, banking, communication tools are being privatized. Private business owners and top management are seeing the most profits at the expense of poor consumers. Active agents of 1% of the elite are infecting vital organs of the society and appropriating their nutrients. As public services are privatized, the price of those services increases and profits multiply as venture capital is exhausted and real wages are cut. In fact, much of privatization is the redistribution of public wealth to the rich, who become richer, while the general public becomes poorer. And this is the real story: what has been achieved is not high efficiency, but the transfer of public assets to influential people who can afford them, usually at fire-sale prices. This is exactly what happened here when natural resources were privatized.
Despite the IMF and the World Bank’s claims of structural adjustment programs (SAPs) successes, it is widely accepted that SAPs have failed to achieve their goals. Both agencies have pushed millions of people into poverty around the world by promoting the same drastic but brutal “economic reforms” – including privatization, budget cuts, and labor “resilience” – regardless of local culture, resources, or economic context. regardless. Heavy debt-burdened Pakistan also accepted these so-called reforms, known as SAP, as a prerequisite for obtaining IMF or World Bank loans. ,
The issue of income inequality is in the news at a time when the Pakistani public believes that there is a growing gap between the rich and the poor that is likely to continue. The people at the bottom are constantly being squeezed, and I don’t see it coming to an end anytime soon. Growing inequality is creating a vicious circle where wealth and power are increasingly concentrated in the hands of the few, leaving the rest of us to fight over the pieces from the top table. Analysis of past privatization has shown that it has not been able to achieve the intended goals of privatization. Once politicians realized that looting public property was an effective way to reward their private beneficiaries, governments themselves became part of the conspiracy.
There are painful examples of national asset grabbing; For example, in 1991 by Mian Nawaz Sharif as Chief Minister of Punjab, Pasrur Sugar Mills was sold to United Sugar Mills of the United Group at a “token price of only Re 1”, Samundari Sugar Mills was sold to Manos and Rahwali Sugar to Muslim League politician Sheikh Mansoor, after single-line advertisements in newspapers under the headline, “Inviting Bids for Rahwali Sugar Mills” and so on. There are hundreds of other examples that cause billions and billions of dollars in damages to the national exchequer. The negligence and favoritism shown by Chief Minister Nawaz Sharif in the privatization of PIDB units had become a hallmark of his privatization as Prime Minister. Similarly, according to reports, Prime Minister Shaukat Aziz and his cabinet embezzled around $24 billion in the privatization process, which was almost equal to the total foreign debt at the time. Let’s learn from history and don’t repeat it. Let’s not ignore the constitution of our state; This is a necessary protection.
The saddest result of privatization was the closure of 20 units followed by transfer to private owners. The closure of these units has damaged the national economy and the first phase of privatization has contributed to the low rate of industrial and economic growth. GDP growth, which was above 6% in the 1980s, declined to around 4% in the post-privatization period. The buyers were not interested in running privatized factories but in taking away the property. It is a constant curse of privatization. Property strippers buy, pay an installment, remove the machinery, sell the actual condition and then leave. All engineering units, except the Milat and Al-Ghazi tractors, were closed after privatization, as their buyers had no intention of running them. Don’t allow our government to rob our most valuable asset. We should tell them that we do not want them to disinvest and/or reduce assets. The people of Pakistan should not accept to sell the loot of these national assets to crony capitalists as profit making public enterprises like OGDC, Electricity, Petroleum and Banks are again in the hit list of the government. Instead of privatization, the government should take extreme measures to end the corruption in these public institutions and try to hold all the accountable people who rob these institutions.