State-Owned Enterprises Report Annual Losses of Rs500 Billion, Says Finance Minister

State-Owned Enterprises Report Annual Losses of Rs500 Billion, Says Finance Minister

Islamabad, September 21, 2023 – Pakistan’s State-Owned Enterprises (SOEs) incurred significant annual losses of around Rs500 billion during the year 2022 due to inefficiencies and mismanagement, according to Dr. Shamshad Akhtar, the Caretaker Federal Minister for Finance, Revenue, and Economic Affairs.

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Addressing a press conference, Dr. Akhtar highlighted the financial challenges faced by SOEs, which include both profit-making and loss-making enterprises. She noted that while some enterprises earned an aggregate profit of Rs330 billion, primarily through oil and gas companies, overall losses to the national exchequer amounted to Rs500 billion.

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Dr. Akhtar attributed the challenges faced by SOEs to factors such as a lack of autonomy, external interference, weak management, limited accountability, and inappropriate boards. These issues have resulted in financial losses and a decline in the quality of services provided by these enterprises.

She emphasized the need for reforming SOEs, citing the successful transformation of the banking industry in Pakistan through privatization as an example. Dr. Akhtar also mentioned that the government is in the process of reviewing the State-Owned Enterprises Policy, with the aim of capacity building for SOEs.

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The minister shared a list of the top ten profit-earning and loss-making organizations for fiscal year 2020. Among the profit-earning companies were Oil and Gas Development Company Limited, Pakistan Petroleum Limited, and National Bank of Pakistan, while loss-making entities included Quetta Electric Supply Company, National Highway Authority, and Pakistan Railways, among others.

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Dr. Akhtar highlighted that the government is committed to addressing the challenges faced by SOEs and improving their performance. She also mentioned the establishment of a data hub for monitoring SOEs’ performance and emphasized the role of the Federal Ministry of Privatization in the privatization process, with the Ministry of Finance providing advisory support.

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