12.2-Privatization_23-1

12.2-Privatization_23-1 - Privatization in Latin America...

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Privatization in Latin America Chong, A., and Lopez de Silanes, F. (2003). “The truth about privatization in Latin America”. Yale ICF Working Paper No. 03-29 Sunita, K., Aishetu F. K.(2005) “Privatization: trends and recent developments”. World Bank Policy Research Working Paper 3765.
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Privatization Number of transaction and proceeds (Worldwide) (1990-2003) : 120 Developing Countries; 7,860 transactions, US$410 bn. dollars
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Privatization in Latin America Top ten revenue generating countries
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Revenues as a percentage of 1999 GDP
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Privatization in Latin America - In each region, proceeds are concentrated over few countries - Regional shares have changed over time (LA declining, Europe Central and East asia increasing) - LA represented 47% of total proceeds (over developing country proceeds and 1990-2003) - After 2000, Brazil the most active: - large transactions included: electricity (CELPE), energy (Petrobras), banking (Banespa)
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Privatization in Latin America Proceeds from privatization
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Privatization in Latin America Proceeds from privatization
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Privatization in Latin America After the Transition Economies of Eastern Europe, Latin America is the region with the largest decline in the state’s share of production in the last 20 years.
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Privatization in Latin America SOEs share of GDP
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Privatization: Not without controversy - Some privatization transaction where either reversed or the company ended up being re-nationalized: - Rail Track in UK (bankruptcy), - Air New Zealand ($300 million rescue package), - La Paz and El Alto water concessions in Bolivia, banks in Chile and Mexico (then renationalized, and subsequently reprivatized). - Despite being just a few it contributed to declining public support, worldwide, for privatization - Opinion polls result: 1995: 75% of LA population supported privatization 1998-2002: reduction of 51% to 35% (say that the state should leave productive activity in private hands)
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Privatization in Latin America Belief that privatization has been beneficial in their country
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Privatization in Latin America It seems that privatization has lost its appeal. Large political backlash to privatization, public opinion and policymakers in LA an other regions seem to have turned against privatization.
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This note was uploaded on 01/18/2012 for the course ECON 4311 taught by Professor Staff during the Spring '08 term at Minnesota.

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12.2-Privatization_23-1 - Privatization in Latin America...

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