Reforming the power : an institutional analysis of power sector reforms in Pakistan

Ullah, Kafait

doi:10.3990/1.9789036538626

Cited by 2 publications

(5 citation statements)

References 86 publications

(141 reference statements)

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“…The outcome does not support the laissez-faire theory that the market-oriented reforms improve the financial condition of both the sector and governments as they contribute towards achieving efficient pricing of electric service. Tanzania's experience seems to confirm earlier findings (Ullah, 2015) that developing countries that only opted for IPPs without divestiture faced difficulties in improving their overall financial condition. Cooksey (2017) claims that since 2002 when IPTL came on stream TANESCO has remained in a chronic insolvency situation as it has been paying more to IPPs and EPPs than it can charge the customers.…”

Section: Reforms and Liquiditysupporting

confidence: 77%

“…Victor (2005) thus confesses that privatization does not make the sector profitable but generates early income to cash broke governments. On the other hand, Ullah (2015) observed that developing countries that only opted for IPPs without divestiture faced difficulties in improving their overall financial condition. Using data from 49 developing countries, the World Bank (2016) saw that after the reforms the cost recovery did not improve.…”

Section: Figure 1 Financial Viability Indicatorsmentioning

confidence: 99%

“…Likewise, in Indian, Bhattacharyya (2007) found that the reforms did not improve the financial position of the sector nor reduce government subsidies. Ullah (2015) claims that in most developing countries the reform objectives have not been met due to lack of appropriate institutions to support the reforms and political will to the reforms; public anxiety to reforms; political interference in management of utilities; weak regulatory framework; lack of separation of policy-making, regulation and ownership roles of the state; and wide-spread of subsidies in electricity tariffs. In most developing countries despite the reforms, the power sectors are still financially unsound and unprofitable with power utilities in SSA have been long technically insolvent, suffering from a structural operating deficit, and continued overreliance on government subsidies and loan guarantees to cover operating losses and investment (World Bank, 2016).…”

Section: Figure 1 Financial Viability Indicatorsmentioning

confidence: 99%

“…The continued TANESCO's financial distress has thus hampered the overall development and sustainability of the sector as the timely recovery of investment is not guaranteed to private investors. Tanzania's experience seems to mirrors Pakistan where Ullah (2015) determined that the power utilities failed to recover the full cost of electricity supply from end-use customers leading to a debt surge.…”

Section: Reforms and Liquiditymentioning

confidence: 99%

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A Review of the Impact of Reforms on Financial Viability and Sustainability of Tanzania’s Power Sector

Andilile¹,

Kapaya²

2021

AEF

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In Tanzania, reforms were mooted in the 1990s to solve two intertwined problems; the financing of investment and reducing the fiscal drain on the government to the sector. This study deploys the ARDL Model and paired-sample t-statistic tests, with profitability and liquidity data from 1989 to 2020 to examine the impact of the reforms on sectoral financial condition in Tanzania. The results suggest that both profitability and liquidity did not significantly improve after reforms. Apart from commercialization policy, other variables were not statistically significant with privatization and liberalization law exerting a negative pressure on liquidity. The findings, therefore, appear to contradict the theoretical view that the reforms improve the financial condition of both the sector and the governments. The outcome can be explained by unfinished reforms manifested by continued politicization of the sector hence underpricing and underinvestment. To ensure sectoral financial viability and sustainability we recommend that the reform policies such as commercialization, corporatization, and independent regulation should be prioritized. These findings will add value to policymakers in Tanzania and beyond which are reforming their power sectors by recognizing that efficient pricing and investment are key for a viable and sustainable financial condition of the sector.

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Section: Reforms and Liquiditysupporting

confidence: 77%

Section: Figure 1 Financial Viability Indicatorsmentioning

confidence: 99%

Section: Figure 1 Financial Viability Indicatorsmentioning

confidence: 99%

Section: Reforms and Liquiditymentioning

confidence: 99%

See 2 more Smart Citations

A Review of the Impact of Reforms on Financial Viability and Sustainability of Tanzania’s Power Sector

Andilile¹,

Kapaya²

2021

AEF

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“…Ltd. This led to the launch of a motorcycle manufacturing factory at the Bin Qasim Industrial Park Karachi in 2015 with approximately 1,400 employees and a production target of 400,000 units by the end of 2020 (Ullah, 2015). Yamaha Motor Pakistan (Pvt.)…”

Section: Case Study Descriptionmentioning

confidence: 99%

Market exit and re-entry in a volatile emerging economy: a case study of Yamaha motorcycles in Pakistan

Khan

Zahoor

Arslan

et al. 2023

MBR

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Purpose This study aims to understand the dynamics underpinning the exit and re-entry strategies adopted by multinational enterprises (MNEs) in an emerging market, Pakistan. Design/methodology/approach This study undertook an in-depth historical case study of Yamaha Motorcycles, which had initially entered Pakistan as a joint venture but had then exited and re-entered as a wholly owned subsidiary. Findings This study found that, despite its status as a market leader and one of the older players in the Pakistani market, changing market dynamics in the 2000s – especially the increased competition brought by more affordable (inexpensive) Chinese motorcycles and the weak enforcement of industrial policies – had pushed Yamaha Motorcycles to exit. Another factor that had contributed to its exit were differences in risk perception and strategies with its local joint venture partner (a Pakistani business group). Hence, both firm-level and institutional factors had played significant roles in Yamaha’s market exit. This study further found that re-entering in a wholly owned subsidiary operation mode had been beneficial for the firm, as it gained a significant market share due to its focus on innovation and on capturing a market niche, which had earlier not been its main focus. The findings also suggest that opportunity logics and multiple forms of learning can be important for a firm’s re-entry into a host market – such as experiential (i.e. learning from experience) and vicarious learning (i.e. learning from other organizations, including suppliers and competitors) in an emerging market context, in which institutions evolve amid political and policy uncertainty. Finally, this study found that exit and re-entry timing is an important factor for the development of competitive advantage in a host market. Originality/value This study is among the few to have investigated the exit and re-entry strategies of MNEs in emerging markets. The relatively short time during which Yamaha Motorcycles had been out of the market had benefited it on its re-entry, as the firm had been able to capitalize on its prior learning and ties to suppliers’ networks.

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Reforming the power : an institutional analysis of power sector reforms in Pakistan

Abstract: No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the author. [iv] [v]

Cited by 2 publications

References 86 publications

A Review of the Impact of Reforms on Financial Viability and Sustainability of Tanzania’s Power Sector

A Review of the Impact of Reforms on Financial Viability and Sustainability of Tanzania’s Power Sector

Market exit and re-entry in a volatile emerging economy: a case study of Yamaha motorcycles in Pakistan

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