Privatisation on track

Malawi's four-year old privatisation programme has earned the government of President Bakili Muluzi about US $21.7 million from the sale of 35 state-owned enterprises, a government official told IRIN on Wednesday. The programme is being carried out under the terms of the World Bank and the International Monetary Fund (IMF), who, together with other bilateral donors, provide up to 50 percent of the impoverished country's budgetary support, according to 1998 government figures. According to an official of the country's Privatisation Commission, 100 state enterprises have been identified for privatisation, among them the telecommunications operator, the power utility ESCOM, the national carrier Air Malawi and the water supply authority. "The main aims of the privatisation programme are to promote efficiency, encourage competition as well as to involve Malawians in the running of the country's economy," the official told IRIN. He said although the programme - started in 1996 - is behind schedule, progress has been made in selling off smaller state-owned enterprises. "We are now in the process of finalising the privatisation of major corporations such as ESCOM, Air Malawi, Telecomms and the Agriculture Development and Marketing Corporation (ADMARC)." He said Malawi Railways was concessioned last December to a consortium of Mozambican and American companies for a renewable period of 20 years, while the Malawi Dairy Industries has been sold to Dairibord of Zimbabwe. The official argued that Malawians are already benefiting from the privatisation of the smaller companies as competition has pushed prices down. "Food prices are now competitive and the consumer has a wider choice of goods and services," he said. The sale of the bigger enterprises is more sensitive, though, the official acknowledged. "There is dissatisfaction being expressed from many quarters about the sale of what are referred to as strategic assets such as ESCOM, Air Malawi, the water utility and ADMARC." He said the main gripe relates to a possible escalation of prices and a loss of jobs due to privatisation. Although he could not give the number of jobs lost, the official said this has happened and is inevitable. He said, however, the government has set up training projects for retrenched workers to learn practical skill that will enable them to find new jobs.