Full privatization is no panacea
China Daily Europe Illustration
A study of Chinese companies challenges Western arguments that full privatization is the panacea
Economic instability caused by the financial crisis in Western economies raises concerns for policymakers in developing countries. In particular, there is concern about the free market development model proposed by the Washington consensus. Policymakers in developing countries are therefore beginning to see China as a role model with respect to economic development.
The free market model calls for the liberalization of markets with less regulation and state interference. This creates an economic environment where business success is financially rewarded and financial reward motivates business decision-making. Full privatization is a key feature of the state reducing its role in the economy. China, however, has stubbornly followed its own, different path to economic development, with both full and partial privatization being a feature. Given China's status as a role model, it is well worth reflecting on its privatization program.
Read the full story at China Daily European Weekly
Posted on Tuesday 14th June 2011