Rural Development
by How can liberalization, privatization, and globalization help in the rural development.
The concept of liberalization, privatization, and globalization help in the rural development of Nepal are detailed below.
Privatization
Privatization means leaving the economy from government control to market. In the broad sense, privatization implies the policy meant to give the greater role to the market mechanism and lessen the government intervention in the economy. It means production of goods and services by NGOs or private limited. It covers various ideas and policies and evokes political reactions.
According to John Black, privatization is the transfer to private ownership and control of assets or enterprises which were previously under public ownership. Privatization assets may have been under direct state, ownership or owned by local authorities. Mary Shirley defined that privatization not only the state of state assets but also privatization the management of state activities through contras and leases and contracting out activities that were previously done by the state. World Bank (1988) defined privatization as increased private sector participation in the management and ownership of activities and assets controlled and owned by the government.”
In 1980s privatization emerged as one of the powerful global economic trend/wave affecting the capitalist, socialist/communist economics, the highly industrializes economics to poorest of the poor of the fourth world. It is in most cases, guided by neoclassical economic theory discouraging government intervention on economic activities and encouraging the private sector/market.
In totality we can say that, the concept of privatization was originated from the economic philosophy of Adam smith. After the failure of the public sector, the wave of privatization spread all over the world. The thought about privatization was first emerged in western countries in 1970s. This came when the effectiveness and efficiency of public sector began to question. It means transfer of assets from state owned enterprises to private companies. It reduces the role of government and increases competition from production goods and services.
Basically there are five types of privatization which are following;
- Mega privatization
- Macro privatization
- Socialistic privation
- Liberal democratic privatization
- Micro privatization
Importance of privatization for rural development
Our country Nepal has the experience of privatization since the period of Panchayat. The government in order to meet the growing challenges of increasing the quality and quantity of basis services, facilities, basic needs of the people, particularly the rural poor, made a number of efforts and undertook several policies to invest public money in a number of governments owned, controlled and regulated enterprises. Privatization can help to increase production of the government owned corporations. It encourages competition among various investors and industries. The main importances of privatization for rural development are listed below.
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