ADB Vice-President Launches SOE Reform Study

ADB Vice-President Launches State-Owned Enterprise Reform Study

WAIHEKE ISLAND, NEW ZEALAND (17 February 2008) – Reforming state-owned enterprises can bring significant economic benefits to the Pacific Region, said Asian Development Bank (ADB) Vice-President C. Lawrence Greenwood Jr. today.

He was speaking at a Pacific Island leaders’ retreat on this island in Auckland’s Hauraki Gulf. The forum — which focused on the state-owned enterprise (SOE) reform experiences of Fiji, Samoa, and Tonga — included the Prime Minister of Samoa and other senior Pacific Island government officials. A new ADB-financed publication, 'Finding Balance: Making State-Owned Enterprises Work in Fiji, Samoa, and Tonga' was launched during the two-day meeting.

"The study is the first comparative analysis of SOE performance among these three countries, and was made possible with the active collaboration of the Governments of Fiji, Samoa, and Tonga," said Vice-President Greenwood. "The analysis reveals the significant economic strain caused by the SOE sector in each of the countries, and illustrates the rapid progress that can be made in reforming SOE sectors where the political will to do so exists. These lessons are applicable throughout the Pacific Region."

"The ADB study highlights the need for, and benefits of, state-owned enterprise reform and we look forward to working with the ADB to improve the performance of our SOEs in 2009," said Prime Minister of Samoa, Tuilaepa Sailele Malielegaoi.

"The time is now right to increase the momentum of state-owned enterprise reform in Tonga, and we are doing this with the help of technical assistance from ADB," said Tongan Minister of Finance and Public Enterprises and Information, O Afu’alo Matoto.

While the study shows that privatizing SOEs is the best and fastest way to improve their performance, it also notes other actions that can be taken to make them more efficient and market-oriented. It stresses that the size of an economy does not have to be an impediment to allowing competition..

Under the terms of the study, SOEs are identified as public enterprises, commercial statutory authorities, government commercial companies, and public trading bodies that are mainly owned by the government.

ADB, based in Manila, is dedicated to reducing poverty in the Asia and Pacific region through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is owned by 67 members—48 from the region. In 2007, it approved $10.1 billion of loans, $673 million of grant projects, and technical assistance amounting to $243 million.

ENDS

© Scoop Media