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February 21, 2020

Govt expected to privatise five PSEs till June-end

Business

February 21, 2020

ISLAMABAD: Government has decided to complete privatisation of five public sector enterprises by end of the current fiscal year, a minister said on Thursday, with a National Assembly body having rectified legal changes to expedite process of selloff or divestment.

Minister for Privatisation Mohammedmian Soomro said the Privatisation Commission is actively pursuing the privatisation plan. “We are hopeful that by June this year at least five entities will be privatised,” Soomro said during a meeting.

These public sector enterprises include SME Bank, First Women Bank, re-gasified liquefied natural gas-based power plants, Mari Petroleum Company Limited, Services International Hotel Lahore and Jinnah Convention Centre Islamabad.

National Assembly Standing Committee on privatisation considered and approved a few amendments into the Privatisation Commission Ordinance 2000, which are necessary to swiftly pursue active privatisation plan. The proposed amendments would go forth for the approval of the National Assembly.

The proposed amendments empower Prime Minister to appoint chairman, secretary or any board member. The Prime Minister can also appoint special medical board regarding health of the chairman, secretary or any board member of the commission. Further, the Privatisation Commission can now open accounts in any of high credit rating banks.

Minister Soomro said active privatisation of public sector enterprises is one of the core components of government’s economic reforms agenda. “This will enable the country for retiring debts and also contribute towards poverty alleviation,” Soomro said in a statement. He avowed commitment to realise economic reforms in a transparent manner. The government identified 18 PSEs from energy, banking, industrial and real estate sectors to be privatised on priority basis fulfilling all legal requirements in the best interest of indigenous economy. Financial advisers for 16 out of 18 PSEs have already hired or are in the final stages of appointment, he added. The minister said privatisation of PSEs is to be undertaken in strict compliance of PC Ordinance 2000, Public Procurement Regulatory Authority rules and court decisions, considering the regulatory and due diligence processes involved.

“The gestation period for an entity to be privatised ranges from a year to one and a half year,” he added. The minister told media the final bidding for two re-gasified liquefied natural gas power plants would be held in April this year. For the revival of Pakistan Steel Mills (PSM), he said financial advisers would soon be appointed for the transactions.

“It is a welcoming sign that various investment parties from China, Japan and Russia have expressed their interest for revival of PSM in joint venture mode,” he said. The meeting was advised that the commission should be allowed to open its account(s) in any of the high credit ratingbanks, identified by the State Bank of Pakistan, due to the urgency of work.

The proposed amendments would facilitate the commission to swiftly meet the deadline and eschew unnecessary delay. The NA body also discussed the leasing of Roosevelt Hotel owned by Pakistan International Airlines (PIA) in New York.

Mustafa Mahmud, chairman of standing committee said all the stakeholders and senior officials from PIA, aviation division, ministry of privatisation and members from PIA subsidiary investment company should be present in the next meeting of the NA standing committee to brief and discuss the status of Roosevelt Hotel in detail.

The cabinet committee on privatisation late last year approved the formulation of the task force for business plan of the Roosevelt Hotel and also formulation of terms of reference. Subsequently, the federal cabinet ratified the decision. However, further work on this task was halted due to the absence of CEO of PIA and pending litigation.