I heard by the end of this month[Jan] Pakistan Govt is going to Privatize Pakistan State Oil[PSO]. If that’s true, boy, I must say, good times are ahead for Pakistan. We’ll see investment by Saudis and Kuwaits very soon.
I’ll try to find out source about it later. 
Here you go PT; posted from the Business Recorder. The Chief of Privitisation was one of the most clean and successful ministers in the provincial cabinets( he was Sindhs finance Minister).
Pakistan State Oil pre-bid meeting by month-end: privatisation adviser
RECORDER REPORT
KARACHI (January 07 2003) : Dr Abdul Hafeez Shaikh, Advisor to the Prime Minister for Privatisation and Investment, informed business community that privatisation of Pakistan State Oil (PSO) would be done in first quarter of the current year.
Addressing a meeting of Karachi Chamber of Commerce and Industry (KCCI), he said that the government is trying to complete all privatisation process as per schedule, and added that a pre-bid conference of PSO would be held by the end of current month.
He said that the privatisation of Karachi Electric Supply Corporation (KESC) is on the cards and a meeting would be held in next week to chalk out timetable for its privatisation.
He said that privatisation of KESC would provide a relief to general public as well as industrialists and business community.
Hafeez said that the government is going to privatise all big units which are in pipeline.
He said that he has just taken over the charge of his new assignment and was holding meeting to get feedback and suggestion of private sector on privatisation.
About privatisation of Pakistan National Shipping Corporation (PNSC), he said that the government would consider feasibility of privatisation of this organisation.
The advisor said that since the days of Z A Bhutto government ministers had been talking of privatisation but very little progress had been made in this direction.
He said that the main hurdles in privatisation process are ministers, secretaries, bureaucrats and others who, on paper propagate privatisation but in practice they create hurdles.
He said that due to this, very little has been done and except the privatisation of UBL no significant progress had been made in this direction.
Hafeez said that the government is restructuring the Board of Investment (BoI), and the Prime Minister will hold BoI meeting once in three months to review its progress.
He said that the government is going to redefine BoI and decide what should be the role of this organisation.
The government would also take advantage of success stories of other countries in attracting investment, he added
He said that the government has already constituted three task forces, one in Karachi, and others in Lahore and Islamabad, to prepare report and suggest practical ways how to attract investment form locals and aboard.
He said that these task forces have representation of private sector, and advised KCCI to suggest practicable ways boost investment in the country to establish industrial units and create new jobs.
He noted that capital has no boundaries and it goes where the investor sees best rate of return on investment as well as best investment climate.
He said that it is not government’s responsibility to direct investors where to invest.
It is the investor who has to decide in which field or area he wants to invest.
Government responsibility is to provide infrastructure, best investment climate and remove hurdles in the way of investment.
He agreed with the contention of business community that cost of doing business is very high in Pakistan, and added that reducing power, gas and local telephone charges is essential.
Welcoming the guests, Shaukat Iqbal, President of KCCI, suggested establishment of new industrial estate near Karachi, reducing of taxes and slashing tariff of power, gas and local telephone charges to attract investment.
Copyright 2003 Business Recorder (http://www.brecorder.com)
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*Originally posted by Zakk: *
Here you go PT; posted from the Business Recorder. The Chief of Privitisation was one of the most clean and successful ministers in the provincial cabinets( he was Sindhs finance Minister).
[/quote]
Thanks Zakk.
I hope, Govt. think about the same for PIA and WAPDA.
Btw, what's the name of Privitization Chief?
Dr Abdul Hafeez Shaikh, Advisor to the Prime Minister for Privatisation and Investment:
Definitely one of the few stars during the Mush provincial governments time. Selling of WAPDA, isn't hard but the WAPDA bureacracy blocks things. The corrupt make tooooo much money out of WAPDA, if it goes private they know their jobs won't be secure anymore. PIA is another matter, it needs reform and to be privatised, but you can't totally privatise it either, after all if there is a Emergency evacuation of Pakistanis from, suppose Kuwait, no private airline would do it. Only a national one would put the needs of the people before the needs of making money.
Zakk,
I know privatizing PIA and WAPDA wouldn't be so easy. Neither, can't be done with a magic stick. But if Govt. privatize half of PIA and WAPDA, I'm pretty sure Public and Private Sector will come over the requirements and mangement problems. :)
Finally, the date of PSO Privatization has been finalized but if a Iraq war breaks out, it could delay the procedure.
UPDATE - Pakistan sets April 26 for PSO bidding
ISLAMABAD, Feb 19 (Reuters) - Pakistan’s Privatisation Commission said on Wednesday it had set April 26 as the bidding date for the the privatisation of Pakistan State Oil.
“The government plans to privatise Pakistan State Oil Company Limited (PSO) as an integrated company by selling a 51 percent stake in the company to a qualified strategic buyer,” a statement from the Commission said.
Representatives of state-run Kuwait Petroleum Corp, the Saudi Arabian group MIDROC and a local business group, the Fauji Foundation, met officials of the commission in Islamabad on Wednesday to finalise the bidding date.
The statement said certain issues needed to be resolved before the bidding but did not identify them.
However, a commission official told Reuters bidders wanted to know what would happen to billions of rupees owed to the PSO by two state-run power companies.
He said the state-run Karachi Electric Supply Corp (KESC) owed roughly 4.5 billion rupees ($77.5 million) to PSO, while the Water and Power Development Authority (WAPDA) owed about 3.0 billion rupees ($51.7 million).
PSO, which has a 70 percent share of Pakistan’s petroleum market, has long demanded that WAPDA and KESC clear up their debts, but the financial woes of the two power companies have prevented them from paying, said the official, who did not want to be identified.
Mohammad Sohail, research head at Investcap Securities, told Reuters the issue was the key concern of the bidders.
Analysts also said that any prolonged war in Iraq could have an adverse impact on the sale of PSO, which the government wants to complete as soon as possible.
**“If a prolonged war breaks out in Iraq, than PSO’s privatisation could be delayed for a few months,” ** he said. “But considering the nature, profitability and potential of the company, buyers will remain interested.”
**PSO, a heavyweight on the country’s main Karachi Stock Exchange, closed down 7.75 rupees, or 4.04 percent, at 184.00 rupees on Wednesday. ($1=58 rupees) **
privatisation without adequate protection for the public could lead to great misery for the people.
In UK when utility companies (water, power, gas) were privatised the government created watchdog bodies which would oversee the functioning of these privatised companies.
In pakistan, unfortunately the self serving ar5eh0les will make sure that any sucj watchdog body is in name only.
Hmm only 3 bidders are bidding for the PSO, two Arab companies and the Fauji foundation. The Arabs are definitely shifting their money out of the West, which is s a good thing for Pakistan. The problem is solely a question of economic stability and law and order for now.
From Hoover’s Online:
**Analysts say Pakistan set to raise up to US$750 million in privatization of state oil company. But again, much of that depends on Law & Order Situation; and Iraq war issue. **
ISLAMABAD, Pakistan (AP) _ **Pakistan is expected to raise US$550 million to US$750 million from the sale of its majority stake in Pakistan State Oil later this year, analysts and privatizations officials said Tuesday.
The government owns 26 percent of the oil company directly and another 25 percent stake indirectly through state-run mutual funds. The remaining shares are publicly held.
“They’re selling a gold mine if you take into account the leading position PSO enjoys in the oil business. I think this price range is realistic,”** said Hina Ikhlaq, Vice-President of Pak-Kuwait Investment Co., which has one of the largest institutional holdings in the oil company.
The list of potential bidders, finalized by the Privatization Commission, includes Pakistan’s Fauji Foundation, Kuwait Petroleum Company and Saudi Arabia’s Midroc Holding.
An auction to sell the company is to be held April 26.
**Profits at Pakistan State Oil, which controls 70 percent of the domestic petroleum market, rose fivefold in the first half of its current fiscal year to US$35.6 million.
PSO’s share price nearly tripled in 2002 on a privatization-led rally and in a generally upbeat market. **
Analysts say that in order to get a maximum price, the government has to clean up PSO’s balance sheet from the loans owed by various state-owned companies. Karachi Electricity Supply Corp. (C.KES) and Water and Power Development Authority owe PSO tens of millions of dollars.
Potential buyers are said to want these debts cleared before PSO goes to the auction block.
Analysts said Kuwait Petroleum stands the best chance of winning the bid due to its long corporate ties with PSO and financial muscle.
“It makes sense for KPC to be more aggressive in the bidding because PSO is a guaranteed marketing outlet for them and a best opportunity for a vertical integration,” said Asif Qureshi, research head at Elixir Securities.