The State Owned Enterprise As A Vehicle For Stability

State-owned enterprises (SOEs) tend to be providers of essential public services, such as electric power companies, water utilities, ports, and transportation networks, but SOEs also engage in an array of commercial activities involving airlines, banks, basic commodity plantations, textile manufacturing, and vehicle assembly plants. Given this magnitude of SOE activity, during the immediate post-conflict period, especially that first 6 months when organizations such as Provincial Reconstruction Teams (PRTs) can be used for the initial screening, prioritization, and selection of SOE revitalization candidates, planners should not neglect the need for institution-building, which usually requires medium- and long-term expertise typically found in economic development agencies. The need is pertinent given that SOEs can be national in scope of operation and scale of resources, and the effective management of the SOEs and their operations can significantly affect national-level economic development. Therefore, agents engaged in stability operations should work with development planners to encourage mid- to long-term institutional capacity building that enhances the conflict-prone country's broader capacity for sustained growth. The intended end state of SOEs in stability operations should be functioning entities that can attract new investment, perhaps by privatization when and where appropriate. Although revitalizing SOEs can be complex and ambiguous, the task can be a useful, intermediate objective on the road to a post-conflict sustainable economy.

This book examines the twentieth-century rise and fall of state-owned enterprises in Western political economy.

State-owned enterprises (SOEs) are present in key sectors of the economies around the world. While they can provide an important public service, there is widespread concern that their activities are negatively affected by corruption. However, there is limited cross-country analysis on the costs of corruption for SOEs. We present new evidence on how corruption affects the performance of SOEs using firm level data across a large number of countries. One striking result is that SOEs perform as well as private firms in core sectors when corruption is low. Taking advantage of a novel database reforms, we also show that SOE governance reforms can generate significant performance gains.

Financial stability risks have been contained so far, reflecting ongoing policy support and a rebound in the global economy earlier this year. Chapter 1 explains that financial conditions have eased further in net in advanced economies but changed little in emerging markets. However, the optimism that propelled markets earlier in the year has faded on growing concerns about the strength of the global recovery, and ongoing supply chain disruptions intensified inflation concerns. Signs of stretched asset valuations in some market segments persist, and pockets of vulnerabilities remain in the nonbank financial sector; recovery is uneven in the corporate sector. Chapter 2 discusses the opportunities and challenges of the crypto ecosystem. Crypto asset providers’ lack of operational or cyber resilience poses risks, and significant data gaps imperil financial integrity. Crypto assets in emerging markets may accelerate dollarization risks. Chapter 3 shows that sustainable funds can support the global transition to a green economy but must be scaled up to have a major impact. It also discusses how a disorderly transition could disrupt the broader investment fund sector in the future.