- World Bank . October 1991 . Republic of Mozambique: Background Paper on Privatization , October , 4 Washington : World Bank .
- Bennell , P. 1987 . 'Privatisation in Sub-Saharan Africa: Progress and Prospects during the 1990s' . World Development , 25 ( 11 ) : 1785 – 1803 .
- Fontaine , J. M. and Geronimi , V. 1995 . “ 'Private Investment and Privatisation in Sub-Saharan Africa' ” . In Privatisation in Less Developed Countries , Edited by: Cook , P. and Kirkpatrick , C. Wheatsheaf : Brighton .
- Green , R. H. 1993 . “ 'The IMF and the World Bank in Africa: How Much Learning?' ” . In Hemmed In: Responses to Africa's Economic Decline , Edited by: Callaghy , T. M. and Ravenhill , J. 61 New York : Columbia University Press .
- Stiglitz , J. 1998 . 'More Instruments and Broader Goals: Moving Towards the Post-Washington Consensus', the 1998 WIDER Annual Lecture , Helsinki : WIDER . but the empirical evidence from Africa in the 1990s belies the idea of loss of interest.for example, argues that 'with respect to privatization of enterprises, the Bank has de facto retreated. Efficiency … is the key and is acceptable through better public enterprise management, autonomy, and accountability or joint ventures, as well as by closure or sale'. This is certainly echoed in a recent argument by
- Campbell-White , O. and Bhatia , A. 1998 . Privatization in Africa , Washington : World Bank .
- Landau , Luis . 1998 . Rebuilding the Mozambican Economy, Country Assistance Review , Washington : World Bank .
- Abrahamsson , H. and Nilsson , A. 1995 . Mozambique: the Troubled Transition - From Socialist Construction to Free Market Capitalism , London : Zed Bodes . for example, are cautiously brief on the subject of privatisation, though they do point out the difficulties in finding criteria for objective evaluation of state assets and they stress the likely impact of credit shortage in narrowing the scope for potential buyers from within Mozambique. Meanwhile J. Hanlon, Peace Without Profit: How the IMF Blocks Rebuilding in Mozambique (Heinemann/James Currey, London, 1996), rather than presenting a detailed critique of privatisation, alleges that a fall in formal sector employment is accelerated by privatisation and cites an allegation that this hits women particularly hard. He appears to line up with a straightforward antipathy towards foreign investment regardless of its provenance, sectoral destination or particular contract terms. He cites a former finance minister alleging, no more, that privatisation is doing nothing to reduce poverty, and claims that no Mozambican can succeed in bidding for a state enterprise without having a senior government official as a partner.
- The World Bank's 1998 publication - Campbell-White and Bhatia, Privatization in Africa - acknowledges that the range, vagueness and changeability of objectives makes it 'difficult, if not impossible, to judge objectively the impact and success of the privatization programs' (p. 21).
- World Bank . 1995 . Bureaucrats in Business: the Economics and Politics of Government Ownership , Washington : World Bank/OUP .
- African Development Bank . 1997 . African Development Report 1997: Fostering Private Sector Development in Africa , Oxford : OUP .
- Bayliss , K. and Cramer , C. 1998 . 'Privatisation and the Post-Washington Consensus: How Does it Differ from the Washington Consensus?' mimeo , School of Oriental and African Studies . show that under the influence of the Bank's chief economist, Joseph Stiglitz, the World Bank has begun to pay more attention to competition and regulation recently, instead of treating privatisation as an end in itself, but that the notion of competition and regulation are excessively narrow and that World Bank privatisation rests on the same fundamental theorems and misconceptions as the Washington Consensus.
- World Bank . August 1996 . Mozambique: Review of Public Enterprise Reform and Privatisation Operation , August , Washington : World Bank, Private Sector Development Department .
- Hoeven , R. Van der and Sziraczki , G. , eds. 1997 . Lessons from Privatization: Labour Issues in Developing and Transitional Countries , Geneva : ILO .
- Van der Hoeven and Sziraczki, Lessons from Privatization, p. 3.
- Adam , C. , Cavendish , W. and Mistry , P. S. 1992 . Adjusting Privatization: Case Studies from Developing Countries , 25 London : James Currey .
- Killick , T. and Commander , S. 1988 . 'State divestiture as a policy instrument in developing countries' . World Development , 16 ( 2 ) : 1465 – 1479 . Campbell-White and Bhatia, Privatization in Africa, p. 24, point out that competition is not cited as an objective of privatisation in Africa except in Ghana.
- See, for example, Adam, Cavendish and Mistry, Adjusting Privatization.
- Weeks , J. 1994 . 'Fallacies of Competition: Myths and Maladjustment in the Third World', inaugural lecture , School of Oriental and African Studies . mimeo,
- Chang , H.-J. 1994 . The Political Economy of Industrial Policy , Basingstoke : Macmillan Press .
- Amsden , A. 1997 . 'Bringing Production Back In - Understanding Government's Economic Role in Late Industrialization' . World Development , 25 ( 4 ) : 469 – 480 .
- Chandler , A. D. , Amatore , F. and Hikino , T. , eds. 1997 . Big Business and the Wealth of Nations , Cambridge and New York : Cambridge University Press .
- Gereffi , G. 1994 . "The Organization of Buyer-Driven Global Commodity Chains: How US Retailers Shape Overseas Production Networks' ” . In Commodity Chains and Global Capitalism , Edited by: Gereffi , G. and Kcrzeniewicz , M. Westport, CT : Praeger . Others stressing the significance of competitive assets beyond the dictates of static comparative advantage or 'competitive' real wage rates include
- Arrighetti , A. 1997 . 'Contract Law, Social Norms and Inter-Firm Co-operation' . Cambridge Journal of Economics , 21 ( 2 ) : 178 – 180 . 180 et al.,Research from Italy, Germany and Britain suggests that appropriate regulation and institutional networks can channel market-based behaviour, 'in the sense of opening up options for co-operative behaviour which would not otherwise be feasible'. Milne, 'Making Markets Work', p. 15, citing
- 1996 . International Finance Corporation, Mozambique-Administrative Barriers to Investment: The Red Tape Analysis , Washington : Foreign Investment Advisory Service .
- Van der Hoeven and Sziraczki, Lessons from Privatization, p. 8.
- Reported in Fine, 'Apologists and Academia', p. 14.
- Chang , H.-J. and Singh , A. 1993 . 'Public Enterprises in Developing Countries and Economic Efficiency: A Critical Examination of Analytical, Empirical and Policy Issues' . UNCTAD Review , 4
- Chang , H.-J. and Singh , A. 1997 . 'Can Large Firms be Run Efficiently Without Being Bureaucratic?' . Journal of International Development , 9 ( 6 ) : 865 – 875 .
- World Bank, Mozambique: Impediments to Industrial Sector Recovery, Report No. 13752- (Macro, Industry and Finance Division, Southern Africa Department, World Bank, Washington, 1995).
- For example, the vogue for market-testing and contract proliferation has been a common feature of both the public and private sector in the UK in recent years, while it is actually clear that the private sector depends on cooperative relationships to a greater extent than supposed by the champions of the arms-length contract. See S. Milne, 'Making Markets Work: Contracts, Competition and Co-operation', Economic and Social Research Council, available from Birkbeck College (University of London, 1997).
- World Bank, Mozambique: Impediments to Industrial Sector Recovery, p. 75. J. Stiglitz, Whither Socialism (MIT Press, Cambridge, Mass., 1994), suggests that given the pervasiveness of market imperfection the chief reason for privatisation is that it lessens the scope for wasting resources in the pursuit of subsidy. This is an extremely weak argument for privatisation, however, once it is acknowledged how common it is for the private sector (domestic and international) to devote considerable energy to the pursuit of subsidy and protection. On this see Bayliss and Cramer, 'Privatisation and the Post-Washington Consensus'.
- Campbell-White and Bhatia, Privatization in Africa, p. 86.
- Hibou, 'The Social Capital of the State as an Agent of Deception', pp. 71-74.
- Quote from Metical, no.608 (18 November 1999).
- See, for example, Van der Hoeven and Sziracki, Lessons from Privatization.
- Cramer , C. and Weeks , J. 1997 . “ 'Analytical Foundations of Employment and Training Programmes in Conflict-Affected Countries' ” . In ILO Action Programme on Skills and Entrepreneurship Training for Countries Emerging from Armed Conflict , Geneva : ILO .
- Castel-Branco and Cramer, 'Privatisation and Economic Strategy in Mozambique', expand on this perspective.
- Unidade Técnicapara a Reestructuração das Enterprises (UTRE), Privatizations in Mozambique, www.utre.com/.
- Meanwhile, Campbell-White and Bhatia, Privatization in Africa, pp. 32-33, report that, with respect to deferred payment initiatives throughout Africa, 'the news is not good. Credit administration has been weak, with privatization agency personnel too busy with current transactions to monitor and take action to collect payments due on past deals …'.
- World Bank, Background Paper on Privatization.
- UTRE . “ 'Evaluating the Impact' ” . 13
- Weeks , J. 1998 . “ 'Macroeconomic Policy and Performance in Mozambique: Adjustment and Unsustainability' ” . background paper for ILO/UNDP Mozambique Human Development Report SOAS . mimeo
- Biggs , Tyler , Nasir , John and Fisman , Ray . 1999 . Structure and Performance of Manufacturing in Mozambique, Regional Program on Enterprise Development , 31 Washington : World Bank .
- On real interest rates, and the domestic/overseas differential access to capital, see also P. G. Ardeni, 'Economic Growth in Mozambique? An Assessment', mimeo (University of Bologna, September 1999).
- Wuyts , M. "The Agrarian Question in Mozambique's Transition and Reconstruction' ” . In Underdevelopment, Transition and Reconstruction , Edited by: Addison , T. Helsinki : WIDER . forthcoming)This process ran alongside the dynamic of differentiation in the countryside that enabled some to do relatively well by bridging access to official resources and operating in the parallel economy under wartime shortage conditions. See, for example,
- For further detail on the evolution of privatisation interests and forms in Mozambique, see Castel-Branco and Cramer, 'Privatisation and Economic Strategy'.
- B. Hibou, 'Fluidity of Boundaries and the "Privatisation of the State": the Case of North Africa', paper presented at a conference on Boundaries and Belonging, University of Washington, Seattle, 21-23 July 1999, argues effectively that privatisation of the state is commonly an ambivalent phenomenon characterised both by the emergence of multiple 'private' actors, intermediaries and networks and by continued processes of state formation, rather than as a simple challenge to the logic of state power.
- LaIl , S. 1995 . 'Structural Adjustment and African Industry' . World Development , 23 ( 12 ) : 2019 – 2031 . On the range of constraints on genuinely sustainable manufacturing expansion in Africa, even where there has been some short-lived and limited growth coterminous with a period of liberalisation, see
- Cramer , C. 1999 . 'Can Africa Industrialize by Processing Primary Commodities: the Case of Mozambican Cashews' . World Development , 27 ( 7 ) : 1247 – 1266 . This material on cashew processing draws on
- UTRE . “ 'Privatization and Labour in Mozambique: Worker and Management Perceptions' ” . Maputo . 19%)
- UTRE, 'Privatization and Labour', suggests this is the case, and it is supported by interviews with public and private sector players conducted as a basis for this paper in Maputo during October 1997. The same study revealed that two thirds of employees found conditions in firms since privatisation either the same as or worse than prior to privatisation. The sharpest improvements were registered in those firms whose privatisation had involved transfer to foreign owners.
- UTRE . “ 'Privatization and Labour' ” . 9
- Fine, 'Privatisation and the Restructuring of State Assets'; Adam et al., Adjusting Privatization, pp. 41 -43, cite evidence suggesting that particularly if short-term budgetary considerations are uppermost in LDC policy challenges, there are higher returns to reforming state-owned enterprises than to divesting them.
- 1989 . 'Privatisation: not the only answer' . World Development , 17 ( 3 ) : 635 H. Vernon-Wortzel and L. H. Wortzel argue that not only do privatisation programmes incur considerable administrative time and effort on the government's part, but there also may be a private sector opportunity cost, since private sector agents may divert money and management effort from other endeavours in order to pursue purchase and takeover of state-owned enterprises. See their
- Cook and Kirkpatrick . 'Introduction and Overview' . 843
- Ramamurti , R. 1997 . Testing the Limits of Privatization: Argentine Railroads' . World Development , 25 ( 12 ) : 1973 – 1993 . For evidence from Argentina see
- Fine , B. 1997 . “ 'Apologists and Academia: A Critical Review of "Bureaucrats in Business"' ” . 14 Department of Economics, SOAS . mimeo
- Campbell-White and Bhatia, Privatization in Africa, p. 48. This is despite their acknowledgement elsewhere that privatisation programmes in Africa are not exactly home-grown and owe much to the advice of the Bank itself.
- World Bank, Background Paper on Privatization, p. 10. The African Development Bank, African Development Report 1997, p. 105, suggests that indeed one of the most convincing justifications for privatisation programmes is the signal it emits about the direction and credibility of government policy reforms in general.
- See C. Castel-Branco and C. Cramer, 'Privatisation and Economic Strategy in Mozambique', in T. Addison (ed.), Underdevelopment, Transition and Reconstruction (WIDER, Helsinki, forthcoming).
- P. Cook and C. Kirkpatrick, 'Introduction and Overview' to 'Policy Arena: Privatization and Public Enterprise Reform in Developing Countries: the World Bank's Bureaucrats in Business Report', Journal of International Development, 9,6 (1997), pp. 843-847. According to Fine, 'Divestiture components are tobe found in 70 percent of all structural adjustment loans [to Africa] and 40 percent of sectoral adjustment loans. In 1992, there were also 60 technical assistance projects in support of privatisation efforts, mostly in sub-Saharan Africa and almost all aimed at strengthening capacities to divest'. B. Fine, 'Privatisation and the Restructuring of State Assets in South Africa: A Strategic View', Occasional Paper Series, 7 (National Institute for Economic Policy [NIEP], Johannesburg, 1997).
- Bennell, 'Privatisation in Sub-Saharan Africa'. If Mozambique is something of an extreme case, this is probably because its bargaining power, vis-à-vis IFI pressure, is especially weak thanks to the degree of macroeconomic imbalances and the acute lack of analytical and policy making resources within the country. Other institutional weaknesses add to this situation: for example, trade unions, typically viewed as a major obstacle to privatisation, are extremely weak and under-resourced in Mozambique.
- Hibou , B. 1999 . "The Social Capital of the State as an Agent of Deception' ” . In The Criminalization of the State in Africa , Edited by: Bayait , J.-F. , Ellis , S. and Hibou , B. London : IAI/James Currey/Heinemann . On the exploitation of this room for manoeuvre, see
- USAID, 'Mozambique: Country Strategic Plan, FY 1996-2001; Economic Annex' mimeo (Maputo, 1996), p. 171. 'As of the end of 1993, over SO percent of the loan portfolio of the Commercial Bank of Mozambique (BCM), the state owned largest bank, was non-performing. State-owned firms such as Cajú de Moçambique, Emocha, Cimentos de Moçambique, L.A.M., and Vidreira were among the largest bad debtors.' World Bank, Mozambique: Impediments to Industrial Sector Recovery, p. 68, note 39.
- Adam, Cavendish and Mistry, Adjusting Privatisation.
- USAID, Mozambique, p. 173.
- USAID, Mozambique, p. 172.
- On Mozambique, see for example World Bank, Mozambique: Impediments to Industrial Sector Recovery, p. 68.
- Nuti , D. M. 1992 . “ 'The Role of the Banking Sector in the Process of Privatization' ” . In Economic Papers, Directorate-General for Economic Affairs, Commission of the European Communities Brussels
- African Development Bank . African Development Report 1997 128
- African Development Bank . African Development Report 1997 130
- World Bank, Background Paper on Privatization.
- World Bank . Background Paper on Privatization 2
- World Bank . Background Paper on Privatization 4
- World Bank . Background Paper on Privatization 8
- World Bank, 'Review of Public Enterprise Reform and Privatisation Operations', Private Sector Development Department (World Bank, Washington, August 1996); Bretton Woods Project, 'The World Bank's Promotion of Privatisation and Private Sector Development: Issues and Concerns', briefing (Bretton Woods Project, London, 1997).
- World Bank . Background Paper on Privatization 4
- UTRE, 'Evaluating the Impact', figure 4, p. 3.
- Abrahamsson and Nilsson, Mozambique, p. 115, raise the question of the opportunity cost of privatisation as a means of generating efficiency, since a 'more effective solution might be to reorganise the (state) companies, replacing earlier soft budget options with strategies which induce them to become profit-oriented and to cover their own costs'.
- See, for example, Deloitte and Touche Ltd, Cashew Marketing Liberalisation Impact Study (Ministry of Tourism, Trade and Industry, Maputo, 1997, on the cashew processing sector.
- This analysis shows that there is little basis for Campbell-White and Bhatia, Privatization in Africa, p. 113, table 6.2, to claim that on the indicator of 'enterprise post-privatization performance' Mozambique scores 'High'.
- Bretton Woods Project, "The World Bank's Promotion of Privatisation and Private Sector Development', p. 4.
- For example, Ramamurti, Testing the Limits'.
- See Berg, 'Privatization in Sub-Saharan Africa', and also Bennell, 'Privatisation in Sub-Saharan Africa'.
- UTRE . “ 'Evaluating the Impact' ” . 19
- Bennell . “ 'Privatisation in Sub-Saharan Africa' ” . 1797
- World Bank, Bureaucrats in Business. The African Development Bank's African Development Report 1997 adopts the same set of criteria, Put otherwise they translate into the following five indicators: net operating surplus, profits before taxes as a share of sales revenue, real variable costs, total factor productivity, and savings minus investment as a percentage of GDP. Notably, Bureaucrats in Business includes only one case study from sub-Saharan Africa, that of Senegal. With respect to all five performance indicators, the collective performance of former state-owned enterprises in Senegal after privatisation deteriorated. See Bennell, 'Privatisation in Sub-Saharan Africa', p. 1800.
- Haque , M. 1996 . 'The Public Service under Challenge in the Age of Privatization' . Governance , 9 ( 2 ) : 186 – 216 . It is hardly surprising if this factor is ignored in the mainstream literature, given the influence of the new political economy, which does not make room for such a potentially positive analysis of individual motivations within the public sector
- Fine . “ 'Apologists and Academia' ” . 3 See also Bretton Woods Project, 'The World Bank's Promotion of Privatisation and Private Sector Development', p. 4, which cites World Bank evidence showing greater concentration of asset ownership after privatisation: Cook and Kirkpatrick, Privatisation in Less Developed Countries: and Adam, Cavendish and Mistry, Adjusting Privatization. The Bretton Woods Project also argues that most privatisation studies, especially those conducted by the World Bank, downplay the potentially negative effects of privatisation on environmental sustainability. Meanwhile, Ramamurti, 'Testing the Limits', highlights the potential for positive externalities to be weakened by privatisation, although he suggests that devolution of responsibilities to provinces affected by rail privatisation in Argentina allowed a more realistic evaluation of the importance of these externalities than was possible under centralised state management of the railroads.
- UTRE . 1996 . “ 'Mozambique: Evaluating the Impact and Effectiveness of the Enterprise Restructuring program' ” . 1 Maputo : UTRE . It is significant that the World Bank appears to be withdrawing from this kind of stance and that Campbell-White and Bhatia, Privatization in Africa, advise that donors and governments stop playing 'the numbers game'.
Journal of Southern African Studies
Volume 27, 2001 - Issue 1