Privatization - SpeedyLook encyclopedia

Privatization and allowance of the financial resources

Privatizations are a means of finding resources financial to feed the Budget of the State. Some were essential, like the obvious result and obligatory international agreements subscribed by France within the framework of the European construction.

From a certain point of view, one can regard as a disadvantage of transforming state enterprises, which are sometimes also tools of town and country planning and Social justice, into private companies having objectives of service to the customer and Rentabilité.
From another point of view, that can have advantages: generally a better business management and a lightening of the financial expenses of the State, which does not have any more to provide for the capital growths necessary to the development of the known as companies.

But as these companies is often financed to see profit, this advantage is far from being generalizable, only fast increases for internationalization, which is not the goal of a state enterprise, require such liftings of funds, case France Telecom.

Conditions of feasibility

Privatizations are sometimes very difficult for the structures concerned, especially if they are fixed at the beginning. To pass from the step Public service to User to the step Undertaken to customer request a sometimes radical reorganization of the companies, the abandonment for the agents of missions which they consider essential is sometimes very frustrating. The phase preceding the marketing is capital, because it is theoretically necessary, so that the company is privatizable, that its economic accounts are durably cleansed, often contrary, a step of financial embrittlement makes it possible to justify privatization, it is the strategy of draining.

Industrial policy and privatization

For some, privatization is a normal phase of the life of certain structures however relevant not being able to be born in a competing system. Therefore, the State creates them and, when they are organized and profitable, sells them so that private companies can generate benefit. What makes it possible at the State to create the useful companies without having to manage them. What poses the problem all the same to see structures built with public money (which is the sum of contributions of taxpaying citizens), of the public property, to become private property. It should be noted that in return the price of these transfers feeds the budget of the State for new useful operations or to reduce the national debt.

Privatizations nomenklaturists

Certain privatizations could allow to the friends capacity to make fortune quickly, in particular in the countries of the old Soviet block. Conversely, a company or a service of the state which works more in the corporative interest of its apparatus and/or its personnel, rather than of managed and users, can be regarded as having undergone an underground privatization in fact by a caste of State (will nomenklatura).

OMC

OMC is an international institution, not attached to UNO, having for goal posted to regulate the trade on a world level. One of its principal actions was to set up an agreement, the AGCS which is one of the engines of current privatizations in the Member States, with the aim of prevent that governments institute an “unfair” competition towards other countries and bar the access to their interior market under pretext of protect certain strategic activities (Santé, education, Eau, Agriculture…).

See too

Internal bonds

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