Privatization and Globalization [Archives:2000/28/Business & Economy]

July 10 2000

Ismail Al-Ghabery
The world today is experiencing an overall revolution in principles, ideas and systems, particularly political and economic. This is described as “comprehensive Globalization”.
The term “Globalization” implies extending principles, thoughts and private systems worldwide to a level where there would be no variance in economic mechanisms and policies. These polices and mechanisms primarily serve North America and West European countries’ interests in controlling the world including the Arab and Islamic worlds.
Nowadays, the notions of leadership and governments are based on the monopoly capitalistic policies of North America and Western European countries. Therefore, it is not odd to observe that the world, including the majority of developing countries, are being forced to apply these Western economic policies if they do not undertake them willingly. Many countries, under economic pressure, acquiesce to the American and European methods and themes to enhance their economic status. One live example is the Administrative and Financial Reform programs imposed on many nations and Arab countries as a compulsory condition for receiving loans from the World Bank or the I.M.F. (International Monetary Fund). Otherwise, the country concerned would be deprived of loans on the pretext that the economy of the country cannot be trusted.
Privatization is a capitalistic notion that shifts the trust to the private sector when the government fails to control development and construction processes amidst spreading corruption and money plundering. It also implies that the government would have no direct, serious or effective role on the development process, leaving this responsibility to the private sector. In this process, the government usually announces the privatization of few or several government institutions that do not function agreeably. After this measure is taken, the responsibility of development and construction of the privatized institution moves to the private sector.
The government has sound reasons to involve itself in this process. The growing corruption and money plundering thrust on the government increasingly heavy loads that it cannot bear. As a result of this, the government incurs more debts to cover the expenses of these Ministries and Institutions instead of gaining revenues from them. Hence, privatization in the middle of this chaos would not drive us safely out of the crisis. Examining the current conditions, privatization would only take us one more step towards a new form of corruption. This could result in even graver problems than there used to be.
In order to rejuvenate the national economy of a country and to increase the pace of development, suitable conditions must be created. The punishment and reward principle must be applied and law must be enforced strictly. Only in this way would the corrupt ministries and government institutions be made to perform their role. At this point, we should understand that privatization is an advanced stage of economic development. This system operates perfectly in countries that have made high progress in enforcing the law. In this manner, privatization would be more than just shifting the property of the people from the hands of the government to those of individuals.
To conclude, all different ministries and government institutions belong to the people and should not be sold out on any pretext.