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Denationalization of 4 multinational companies |
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August 11, 2000
Dhaka (UNB)- The government yesterday (Thursday) offloaded its shares in four multinational companies incorporated in Bangladesh. Privatisation Commission Chairman Kazi Zafarullah handed over the share transfer documents to the executives of Berger Paints, Siemens, Van Ommeren Tank Terminal and International Oil Mills at a function in presence of Industries Minister Tofail Ahmed. FBCCI President Abdul Awal Mintoo, British High Commissioner to Bangladesh Dr David Carter, Charge d' Affaires of Netherlands Embassy in Dhaka Jan Maas and German Embassy official Lenferding were also present. Government held 42.33 per cent shares of British paint company Berger, 31.66 per cent shares of German company Siemens and 50 per cent shares of Van Ommeren and International Oil - both Dutch companies. Total sale value of government shares of the four multinationals stood at Tk 37,30,26,000 against the face value of Tk 4,58,06,000. Speaking on the occasion, the Industries Minister said that although privatisation is a declared policy of the government and among its top most priorities, the government wants to keep some sectors, including fertiliser, in its hand. Citing "bitter experience of erratic distribution" of fertiliser during the past regime, Tofail Ahmed said: "We have decided not to hand over urea fertiliser factories to private sector." He, however, invited foreign companies to invest in fertiliser sector to meet the country's demand for urea that rises at an annual pace of 6 per cent. Urea demand will rise up to 3.2 million metric tons by the year 2005 and 4.2 million tons by 2010, while the country's production capacity now stands at 2 million tons. The minister cited the miseries of workers of two privatised jute mills in Chittagong, which are now closed. Opposing the blanket blame put on workers for inefficiency of the SOEs, he said sometime the system itself and sometime infrastructure problems cause inefficiency in SOEs. Tofail said privatisation is a gigantic task considering the character of trade unions in Bangladesh and it needs political consensus to overcome. Political consensus on privatisation has been apparently there, but a ruling party opposes its own stand whenever it becomes opposition, he regretted. Explaining the government's stand on offloading its shares in these profit making foreign companies, Kazi Zafarullah said the present government is serious about privatising all state-owned enterprises - whether it is small or large, profit-making or non-profitable. "We also encourage the foreign companies to invest in Bangladesh as foreign direct investors," he said, giving a clear signal to the foreign investors that they are most welcome in Bangladesh. Since the inception of the Privatisation Board in 1993, 12 SOEs were privatised during the BNP rule. The process of privatisation of 38 more has been finalised during the period of the present government, Zafarullah informed. Besides, policy has already been framed to hand over 9 textile mills and one jute mill to workers and employees, he added. A new law passed in July this year converted the Privatisation Board into a Commission and authorised it to sell any enterprise valued up to Tk 25 crore and left various options, including management contract, sale to workforce, franchise, BOT, BOO, joint-venture, corporatisation and lease of SOEs. Abdul Awal Mintoo, who is also a member of the Privatisation Commission, said that privatisation is crucially important for sustainable economic development and efficient use of resources. But pace of privatisation has been very slow, he observed. British High Commissioner David Carter said state's role should be that of a partner and facilitator, not of dictator. Government must allow private sector to undertake all activities except some areas of specific public interest, he felt. From British experience, Carter admitted "some short term pains" in privatisation, but put public interest above all. He, however, said privatisation alone will not be enough to overcome governance problems like corruption and poor law and order situation that hinder Bangladesh's development. Dutch envoy Jan Maas, while underpinning the urgency of privatisation in Bangladesh, said the Netherlands government also went for massive privatisation of chemical and telecommunications sectors. |