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PRIVATISATION

Privatisation leads to profitability: report

Sweden's former state-owned enterprises have become more profitable and effective when privatised, according to a report from the Ministry of Enterprise, Energy and Communications (Näringsdepartementet).

Published: 29 June 2009 13:53 CEST

The report, authored by Henrik Jordahl of the Research Institute of Industrial Economics, concludes that there are significantly more profits to be made for state-owned companies and employees by transitioning to private ownership – especially in conjunction with competitiveness-boosting reforms.

Minister for Local Government and Financial Markets Mats Odell backs Jordahl’s findings.

“Sales of state-owned enterprises undertaken by the government during this term have had positive effects for the public purse and to strengthen government finances,” Odell said in a statement.

The report also states that few studies have been done showing the effect of privatisation in Sweden.

“Despite comprehensive privatisation under both centre-right and Social Democratic governments since the beginning of the 1980s, there is a dearth of more comprehensive academic studies. This is a largely an uncharted area for Swedish academics that I believe deserves to be studied,” said Odell.

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STEEL

Troubled steel plant may be nationalized

Italian Prime Minister Matteo Renzi on Sunday floated the idea of nationalising during "two or three years" the country's loss-making Ilva steel plant, one of Europe's most polluting.

Published: 1 December 2014 08:17 CET
Troubled steel plant may be nationalized
The loss-making Ilva steel plant, in Taranto, may be nationalised. Donato Fasano/AFP

The Ilva site at Taranto in the Puglia region of southern Italy has been under special government administration since last year after its owners were accused of failing to contain toxic emissions.

"We are considering whether we should intervene in Ilva with a public body," Renzi said in an interview published in the daily La Repubblica.

"We could put the company back on its feet in two or three years, protect jobs, protect the environment and then put it back on the market," he said.

The premier added that he would rather see the steel plant in private hands, but if no solution was found then "I prefer intervening directly for a few years".

International steel giant ArcelorMittal and Italy's Marcegaglia said earlier this week they had submitted a non-bidding offer to acquire Ilva's operations. The bid is being examined by Ilva's special commissioner.

No other offers have come in yet to save the steelworks, which employs 16,000 workers and has the biggest output capacity of any plant in Europe.

It is currently operating at roughly half of its peak production level of 11 million tonnes per year because of weak demand and chronic overcapacity in Europe.

A report by the European Environment Agency on Tuesday named Ilva as one of the 30 worst industrial plants for pollution in Europe.

Renzi is seen as desperate to secure some kind of future for Ilva against a gloomy economic backdrop of a contracting economy and stubbornly high unemployment. He has said he wants a solution for Ilva by Christmas.

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