Prof Peter Quartey
Economist Peter Quartey has tasked the new Public Enterprises Minister to develop targets for State Owned Enterprises (SOEs) that are directly linked to their profitability, having welcomed his appointment.
According to him, some SOEs have become a burden on the government, hence the need to make the state enterprises profitable.
“SOEs are supposed to be profitable but some have become a drain on the government and therefore there’s a need to restructure. They should also be given targets and monitored to ensure that they achieve their targets,” Prof. Quartey said.
In an interview with the media on the way forward with SOEs in the country, he further asked that the new minister prioritises decreasing the SOE dependence on the government by prioritising the sustainability of SOEs.
“In as much as they will be given space to operate, they should be held accountable to whatever they do to ensure that they achieve their targets and that they make those institutions profitable. Otherwise, they will continue to draw salaries, continue to depend on government for budgetary support, and yet they do not provide the needed revenue that will help enhance development” Professor Quartey said.
The new office
President Nana Addo Dankwa Akufo-Addo submitted the list of proposed Ministers of his new government to the Speaker of Parliament for approval.
Among the new nominees is Joseph Cudjoe, a former Deputy Minister of Energy, who has been put forward as Minister for Public Enterprises, and is expected to oversee the restructuring of state-owned enterprises with the objective of increasing their productivity and profitability.
The Finance Minister-designate, Ken Ofori-Atta, back in November last year disclosed that as many as 19 SEOs were projected to post losses of up to GHC1.6 billion for 2020.
According to the 2018 State Ownership Report, the financial performance of 77 enterprises owned by the government were mixed.
While Joint Venture Companies (JVCs) posted impressive financial results achieving an aggregate net profit of GHC1.35 billion in 2018 from a net loss position of GHC272.22 million in 2017, the performance of SOEs further deteriorated in 2018 culminating in a combined net loss of GHC3.12 billion.
Both SOEs and JVCs posted marginal increases of 7.35 percent and 2.48 percent respectively in revenue.
Per the report, the ability of the JVCs to keep their costs down compared with their SOEs counterparts accounted for their contrasting bottom line results, the report explained.
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