Privatization evaluation: Avoid past mistakes

تم نشره في Mon 31 March / Mar 2014. 06:51 PM - آخر تعديل في Mon 31 March / Mar 2014. 06:51 PM

By Jumana Ghunaimat

Despite the sensitivity of the subject among the Jordanian public opinion and government agencies at the same time, Dr. Omar al-Razaz offered a more-than-neutral assessment of privatization in Jordan for both the execution of the sale and its implications, for about 19 ​​companies and institutions that have been privatized over the past two decades.

The assessment did not exclude any of the companies that were sold — and valued the process without bias —to conclude that the “Royal Jordanian” (RJ) was the best deal in terms of alignment with international best practices, as opposed to companies like "Phosphate", "Umniah", and "Cement" as the worst. This helps the public judge the extent of transparency during the execution of the privatization deals.

The presentation made by Dr. Al-Razaz — during the launch of the report of the Privatization Evaluation Committee (PEC), the day before yesterday — mentioned companies that have been sold and not many knew about, such as Jordan Aircraft Maintenance Limited, and the Duty Free Markets.

It was not an easy task; it was rather daunting, and had a much heavier psychological impact than those long working hours spent by members of the PEC in the completion of the task entrusted to them by the King, when he formed the committee to evaluate a process that the Jordanians have been complaining about for long.

The report is long, and needs to be read in detail for one to get a clear position on the entire process. But this step punctuated attempts to decipher the story has been worrying people for long, who had the impression that their money was stolen.

The report explains, in detail, the amount of money earned from all the deals, valued at 1.76 billion dinars; 1.56 billion dinars were used to pay up and buy debts, 153 million dinars were used in development projects, and 40 million dinars were allocated to the program for economic and social transformation.

The report shows that the spending decisions were taken by the cabinet. But it also showed that the development projects, and the "transformation" program, lacked the basic requirements in order to be consistent with the law; regarding the preparation of feasibility studies, and inclusion in the state’s budget.

What the people thought was true, but not in all transactions. While RJ’s sale was done according to transparent criteria, the "Phosphate" sale was coupled with many legal and constitutional violations.

In the end, we have today an important document pointing to the mistakes, missteps, and violation of public money. The priority should be that the government learns from the experiences in the coming days, especially since Jordan is on the verge of establishing large-scale projects and forming new partnership between the public and private sectors, worth billions of dollars.

The PEC, in the end, is not a judicial body to implement the required provisions. But it offers a wealth of information related to the whole process, and helps build a public awareness to follow what is going to happen in the future — it also imposed the criteria of transparency and disclosure as a requirement for the governments, and forces them to stop deals done under the table.

The most important part of the report — which gave a candid assessment of the situation even regarding sensitive issues —is the recommendations, including those strategic, legislative, and executive; they set a goal that aims to achieve what is best for privatization and development, and not the goal of selling assets.

The recommendations stressed that there is no substitute for credibility and transparency of the procedures, in addition to clear disclosure of results. It identified steps that — if the government adheres to —will lead it to avoid the mistakes of the past, and thus reduce the chances of the imbalances and distortions.

The committee did not come to say that what happened before was “perfect”, neither to say that chaos was overwhelming; it provided a rigorous and practical evaluation that did not aim to flatter anyone — that is what should matter.

@jumanaghunaimat

 

This article is an edited translation from the Arabic edition.

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