Advantages and Disadvantages of Privatisation 2
ADVANTAGES AND DISADVANTAGES OF PRIVATISATION
Contents 1.0 INTRODUCTION 1 2.0 ADVANTAGES OF PUBLIC SECTOR PRIVATISATION 2 2.1 Improving Efficiencies 2 2.2 Reduction in Government Cost and Spending 3 2.3 Focusing on Core Competences 3 2.4 Streamlining Businesses to Allow Productive Job Creations 4 2.5 Obtaining Goal Congruences 4 2.6 Effective Utilization of Taxpayers’ Money 5 2.7 Generate Income Tax Revenue 5 2.8 Improving Government Financing 6 2.9 Reorganisation or Restructuring Government Systems and Performance Measures 7 3.0 DISADVANTAGES OF PUBLIC SECTOR PRIVATISATION 7 3.1 Possible Control of Foreign Entity on National Interests 7 3.2 Monopoly Risks 8 3.3 Management Incompetencies 8 3.4 Misproprietion of Funds and Misuse of National Interests 9 4.0 ADVANTAGES OF PUBLIC LISTING PRIVATISATION 10 4.1 Focus on Core Competences such as Operations, Financing and Investments. 10 4.2 Reduce Regulation Costs in the Long Term 10 4.3 Reduction in Regulatory and Public Scrutinies 11 4.4 Allow Effective Decision Making With Optimum Risk Apetite 11 4.5 Focusing on Maximising Shareholder’s Wealth 12 4.6 Reduction Interference of Minority Shareholders. 12 5.0 DISADVANTAGES OF PUBLIC LISTING PRIVATISATION 13 5.1 Costly 13 5.2 Increase of Gearing and Reduction of Cash Holding. 13 5.3 Reduction in Finance Pool 14 5.4 Valuation of the Company would be costly and Might Not Reflected to True Market View 14 5.5 Reduction of Shares Liquidity. 15 6.0 CONCLUSION 15
1.0 INTRODUCTION
Privatization currently is a hot story in our nation. There had been famous privatization which had attracted headlines recently such as FELDA and FELCRA, which open its shares for public listing. Hence it is quite important for us common people to comprehensively understand such issue. As per question there should be strong critical analyzation on advantages and disadvantages of the concerning move therefore appraised the question
Contents 1.0 INTRODUCTION 1 2.0 ADVANTAGES OF PUBLIC SECTOR PRIVATISATION 2 2.1 Improving Efficiencies 2 2.2 Reduction in Government Cost and Spending 3 2.3 Focusing on Core Competences 3 2.4 Streamlining Businesses to Allow Productive Job Creations 4 2.5 Obtaining Goal Congruences 4 2.6 Effective Utilization of Taxpayers’ Money 5 2.7 Generate Income Tax Revenue 5 2.8 Improving Government Financing 6 2.9 Reorganisation or Restructuring Government Systems and Performance Measures 7 3.0 DISADVANTAGES OF PUBLIC SECTOR PRIVATISATION 7 3.1 Possible Control of Foreign Entity on National Interests 7 3.2 Monopoly Risks 8 3.3 Management Incompetencies 8 3.4 Misproprietion of Funds and Misuse of National Interests 9 4.0 ADVANTAGES OF PUBLIC LISTING PRIVATISATION 10 4.1 Focus on Core Competences such as Operations, Financing and Investments. 10 4.2 Reduce Regulation Costs in the Long Term 10 4.3 Reduction in Regulatory and Public Scrutinies 11 4.4 Allow Effective Decision Making With Optimum Risk Apetite 11 4.5 Focusing on Maximising Shareholder’s Wealth 12 4.6 Reduction Interference of Minority Shareholders. 12 5.0 DISADVANTAGES OF PUBLIC LISTING PRIVATISATION 13 5.1 Costly 13 5.2 Increase of Gearing and Reduction of Cash Holding. 13 5.3 Reduction in Finance Pool 14 5.4 Valuation of the Company would be costly and Might Not Reflected to True Market View 14 5.5 Reduction of Shares Liquidity. 15 6.0 CONCLUSION 15
1.0 INTRODUCTION
Privatization currently is a hot story in our nation. There had been famous privatization which had attracted headlines recently such as FELDA and FELCRA, which open its shares for public listing. Hence it is quite important for us common people to comprehensively understand such issue. As per question there should be strong critical analyzation on advantages and disadvantages of the concerning move therefore appraised the question