ISLAMABAD: The Asian Development Bank (ADB) and the Pakistan government on Tuesday signed an agreement to invest $20 million to improve corporate governance, technical capacity and regulatory framework of Pakistan’s privatization program.
Dr Werner E. Liepach, ADB’s Country Director for Pakistan and Mohammad Saleem Sethi, Secretary Economic Affairs Division (EAD), signed the loan agreement.
According to a statement issued by the ADB, Dr Liepach said that the project will finance management and financial consulting services to develop the capacity of Finance Ministry to monitor the Public Sector Enterprise (PSE) portfolio, assess fiscal liabilities, identify and track potential issues, and oversee corporate restructuring of selected PSE.
He said it will also strengthen the process by improving the corporate governance and management capacity of selected PSE and strengthening governance and regulations in selected sectors dominated by PSE.
PSE accounts for about 10 percent of Pakistan’s gross domestic product (GDP) and thus comprise a major share of Pakistan’s economy. Weak corporate governance and management issues have been resulting in their poor service delivery and bleeding of country’s scarce financial resources with tax payers ultimately bearing the brunt of these inefficiencies.
The project seeks improvement of the governance and regulatory regime to ensure that efficiency gains in PSE are in line with interest of the general public and consumers.
The assistance will help improve financial control and reporting through improved inter-agency coordination and online monitoring system at the Security and Exchange Commission of Pakistan (SECP).
It will also assist the Privatization Commission in preparing a privatization strategy and monitor the transaction. “The expected impact would be reduced fiscal and economic costs through improved management and governance of Pakistan’s PSE”, Dr Liepach added.
ADB, based in Manila, is dedicated to reducing poverty in Asia and the Pacific region through inclusive economic growth, environmentally sustainable growth, and regional integration. Established in 1966, it is currently owned by 67 members—48 from the region.
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