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| Lease, not sell them |
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| Thursday, 29 July 2010 19:39 |
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The Aquino administration has seen the folly of mindless privatization and is reversing this policy. We have time and again denounced this policy as detrimental to the national interest, especially for assets that are of strategic value to the country’s economy and security. Once a state-owned property is sold, the cash-strapped government may shore up its coffers for the short-term. Selling off assets is a one-time or non-recurring transaction. But the returns – profits or dividends – it derives from the continued operation of a government-owned or -controlled corporation, a real estate property or utility would be permanently lost. Because of the strategic importance of certain enterprises like a utility company, privatization is a politically contentious issue because of its socio-economic repercussions. It is thus reassuring that the Aquino administration is abandoning its predecessor’s privatization strategy by favoring long-term lease on prime real assets over outright sale, Finance Secretary Cesar Purisima said. “We will review our privatization strategy. We want to continue to raise income without selling the nation’s jewels,” Purisima was quoted by a broadsheet as saying. He said the Department of Finance is finalizing its inventory of all government assets and will soon determine which prime properties would be privatized. The Finance chief said the government would likely start with long-term lease development of the Welfareville compound in Mandaluyong, the National Penitentiary in Muntinlupa, the Davao Penitentiary, and the Navy properties along Roxas Boulevard ,and at Fort Bonifacio. “While we will be pragmatic, our bias is toward long-term leases of these assets rather than outright sales. We want to preserve the government’s asset base for future generations,” Purisima said. President Aquino, in his first State-of-the-Nation-Address, said his administration has received an offer to lease Navy properties for $100 million plus a share in future income. He said the proponents also offered to build the Navy a new headquarters at Camp Aguinaldo at no cost to the government. The government targeted P30 billion in proceeds this year for its long-delayed sale of three big-ticket items led by the sprawling Food Terminal Inc. complex in Taguig City. The mad rush to privatize is on account of record budget deficit staring the government in the face this year. From P300 billion, the target has been raised to P325 billion or 3.9 percent of the gross domestic product. The new deficit goal for 2010 is 9.1 percent higher than last year’s deficit of P298 billion or an increase of P27 billion. |
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