University of Khartoum

A study submitted in partial fulfillment for the requirements of the Degree of Master Public Administration

A study submitted in partial fulfillment for the requirements of the Degree of Master Public Administration

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Title: A study submitted in partial fulfillment for the requirements of the Degree of Master Public Administration
Author: Manar Ismail El-Misbah Mekki, Mekki
Abstract: The objective of this study is to clarify privatization policy in Sudan, the reasons which led to the failure of public sector in Sudan; and, most importantly, how enterprises were valuated when prepared for privatization. It examines the degree of propriety and transparency in the valuation of public sector enterprises for privatization in Sudan, as against how public enterprises should be valuated when prepared for privatization. The latter is essential to avoid criticisms and accusations about the squander of public money, which are usually raised when there is no adequate transparency. The study also evaluates the valuation procedures for the enterprises which are already privatized. The basic literature for the study was collected from library sources, the Internet, some reports and documents pertaining to privatization in Sudan. For empirical data, the study relies on interviews conducted with certain senior staff members of the chosen enterprises, and the Technical Committee for the Disposition of Public Sector Enterprises. Additionally, the interviews conducted were supplemented by the administration of a simple questionnaire answered by the same staff members. The persons interviewed are listed as (appendix 3)to this study. The study presents the concept of privatization and reasons that led governments to privatize certain public enterprises. It presents the meaning of privatization, theories, supporting and opposing opinions, objectives, methods, stages, the operational management of privatization, and the valuation of enterprises (chapter one). It also discusses privatization in Sudan and the decisions taken for adopting it, the difficulties facing privatization and the effects of privatization in Sudan (chapter two). More importantly, the study considers the valuation of enterprises for privatization, and explains how that process has been carried out in Sudan (chapter three). Finally, 118 the study presents an analysis and findings in the concluding chapter and conclusions of the study (chapter four). This study has been applied on five economic enterprises in different sectors. The enterprises chosen for the study were The Commercial Bank of Sudan, The White Nile Tannery, The Khartoum Tannery, Sudan Telecommunications (SUDATEL), Sudan Airways Company, and Rabak Cement Company. All these enterprises were privatized except Sudan Airways (Company) and Rabak Cement Company, which has not yet been privatized, but whose assets have been valuated in anticipation of privatization. However, the present study found that, the valuation of the enterprises which had been privatized and the procedures followed in their valuation were not clear enough. Also there was no availability of data or documents related to those procedures. Additionally, the directors and employees of those enterprises were not actually involved in the programme, and relevant data was not available. The necessary data which pertaining the enterprises whose privatization programmes, were not completed are vailable. The valuation of Sudan Airways Company was based on the book value with estimations for one year of the net present value and cash flow. But the valuation did not include the evaluation of human and technical resources in the company, both of which are important factors and must have been considered in the valuation of the company. The valuation methods used in case of Rabak Cement Company consisted of the replacement of assets value, in addition to net present value. The replacement of assets value method alone is not suitable for the 119 existing enterprise, but in case of use of net present value it is considered to be the most accurate method. Therefore, the study concludes that the data pertaining to privatization and all the procedures followed in the privatized enterprises were very much confidential. But the data available is pertaining to the enterprises whose privatization programme was not completed. This situation contradicts the conditions which are regarded as fundamental for successful privatization. Therefore, the necessary procedural requirements for privatization did not exist in Sudan’s experiment, particularly regarding transparency
URI: http://khartoumspace.uofk.edu/handle/123456789/12058
Date: 2015-06-14


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