ABSTRACT
This chapter provides a comment on the state of financial returns from public enterprises in developing countries and reviews the concept of financial and social returns combinations expected of them. It focuses on the growing emphasis on improving the financial returns and considers options of policy on the acute problems of deficits. Close empirical reviews suggest that this is not so much a function of gestation or of a temporary slump in their business conditions as it is a consequence of such basic handicaps as wrong investment decision, low productivity, managerial inefficiency compounded by governmental interventions, and defective financial structures applied to the enterprises. The observations by the Working Party on Government Expenditures, followed by the President’s pronouncements in Kenya, illustrate the shift of policies towards financial improvement in public enterprise performance. Algeria is ‘greatly disturbed by the overall performance of public enterprises’ and remedial measures are being designed.
