engleski

The privatization process in Croatia

This chapter deals with corporate performance under conditions of state intervention. It analytically examines the legal and institutional framework that directly influences the operational behaviour of corporations. The study explores the sources and the scale of interventionism in the corporate sector, concentrating on the financial aspects. After identifying the theoretical background a number of fundamental questions are being addressed. Has direct state aid financing of companies in financial difficulty with soft loan conditions speeded up the process of privatisation and increased their value? Has the efficiency, productivity and market performance of those companies been affected by state intervention? What are the general lessons to be learned for the process of restructuring? According to our research on a sample of 56 companies the preliminary results indicate that extended state ownership of companies and state interventionism did not lead to immediate success. The paradox is that quick privatisation even under good restructuring programs does not lead to immediate success in the hunt for better market position and exports. Establishing a firm position in nation-wide and international markets obviously requires company governance under market conditions and some competition experience which can only be gained with time. In the final part of the paper key policy issues are addressed and approaches suggested to overcome the difficulties uncovered.

Macroeconomic environment, microeconomic environment, legal framework, restructuring, privatization, role of government

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