KINIBIZ The divestment programme aimed at reducing the government’s role in business, one of six key strategic reform initiatives (SRIs) under the Economic Transformation Programme (ETP) continues to fall behind its stipulated deadlines.

The ETP 2013 Annual Report noted that under the KPI which monitors the sale of ministry-linked companies, the government is receiving a red mark for its efforts under the programme’s traffic light system, which means that it is under-performing.

This is because out of the four companies that were slated to be divested, only one divestment was actually completed.

According to the report, only one company held under the Ministry of Youth and Sports was successfully divested.

The divestments of two others from the Works Ministry and one from the Federal Territories Ministry were not completed.

The second KPI under the initiative, which covers the divestment of government-linked companies (GLCs), was better met, as out of nine companies identified, eight were successfully divested.

Among them were Khazanah Nasional Bhd’s sale of its entire holdings in DiGi.com Bhd, which is thought to have amounted to about RM293.5 million.

The report noted that the biggest challenge facing the government in its efforts to sell its holdings in the relevant companies was “the need to balance the fiduciary duties of incumbent owners with market conditions, which may impact price”.

Looking ahead, the report said “this SRI will continue to monitor the companies under the divestment programme, in line with the government’s efforts to facilitate a competitive environment for business and to strengthen the private sector’s role in driving the economy.”

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