IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/82762.html
   My bibliography  Save this paper

Governance Innovation for SOEs in Bulgaria: Based on Korean Experience

Author

Listed:
  • Park, Jin
  • Dimitrov, Mitko
  • Bobeva, Daniela
  • Keremidchiev, Spartak
  • Tchipev, Plamen

Abstract

The recent financial performances of many Bulgarian SOEs have revealed the shortcomings in the management of its SOEs. The main direction of Bulgarian reforms should be improving transparency, better selection and appraisal of management, sustainable dividend policy, strengthening financial discipline and coherent ways to reduce the debt burden. The institutional status quo is clearly inefficient and needs to be replaced. The direction of SOE governance reforms in Korea and Bulgaria are substantially different. Korea has maintained a very centralized grip over SOEs for an extended period of time, and it needs to reduce government intervention by guaranteeing more autonomy for SOEs. On the other hand, Bulgaria needs more centralized control over SOEs, which is expected to improve their performance. The Korean experience in reforming its SOE management system is highly relevant for Bulgaria and it complies with the OECD Guidelines on Corporate Governance of State-Owned Enterprises. This paper asks 31 questions regarding a system of good governance and presents options for each question regarding positive and negative aspects, followed by specific recommendations for the Bulgarian government. It is recommended that a centralized authority responsible for the management of SOEs be established which is composed of line vice-ministers and experts from academia and the private sector. Major tasks and responsibilities should be transferred gradually from line ministries to this new setting. Among these include increasing transparency, the introduction of an evaluation system with strict consequences and related open competitive procedures for the selection, the appointment and appraisal of CEOs, as well as an annual bonus system. SOE governance reform in Bulgaria will touch off strong resistance from both line ministries and their SOEs. Therefore, it will require a good deal of effort and strategy to accomplish the task. It is important to win the minds of the people and the political leadership in that the current system is subject to a number of problems, and that reform of the system is critical to a more efficient economy and provision of better public services to its citizens.

Suggested Citation

  • Park, Jin & Dimitrov, Mitko & Bobeva, Daniela & Keremidchiev, Spartak & Tchipev, Plamen, 2016. "Governance Innovation for SOEs in Bulgaria: Based on Korean Experience," MPRA Paper 82762, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:82762
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/82762/1/MPRA_paper_82762.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Osama J. A. R. Abu Shair, 1997. "Privatization and Development," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-25374-6, December.
    2. David Parker & David Saal (ed.), 2003. "International Handbook on Privatization," Books, Edward Elgar Publishing, number 2330.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Arndt, Channing & Benfica, Rui & Thurlow, James, 2011. "Gender Implications of Biofuels Expansion in Africa: The Case of Mozambique," World Development, Elsevier, vol. 39(9), pages 1649-1662, September.
    2. repec:dgr:rugsom:01a21 is not listed on IDEAS
    3. Riham Ahmed Ezzat, 2015. "Paving the way for better telecom performance: Evidence from the telecommunication sector in MENA countries," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01164199, HAL.
    4. Megginson, William Leon, 2005. "The Financial Economics of Privatization," OUP Catalogue, Oxford University Press, number 9780195150629.
    5. Thomas Vendryes, 2014. "Peasants Against Private Property Rights: A Review Of The Literature," Journal of Economic Surveys, Wiley Blackwell, vol. 28(5), pages 971-995, December.
    6. Bouquet, Emmanuelle, 2009. "State-Led Land Reform and Local Institutional Change: Land Titles, Land Markets and Tenure Security in Mexican Communities," World Development, Elsevier, vol. 37(8), pages 1390-1399, August.
    7. Diao, Xinshen & Roe, Terry & Doukkali, Rachid, 2002. "Economy-wide benefits from establishing water user-right markets in a spatially heterogeneous agricultural economy," TMD discussion papers 103, International Food Policy Research Institute (IFPRI).
    8. O'Toole, Conor M. & Morgenroth, Edgar L.W. & Ha, Thuy T., 2016. "Investment efficiency, state-owned enterprises and privatisation: Evidence from Viet Nam in Transition," Journal of Corporate Finance, Elsevier, vol. 37(C), pages 93-108.
    9. Molden, David & Sakthivadivel, Ramasamy & Samad, Madar & Burton, Martin, 2005. "Phases of river basin development: the need for adaptive institutions," Book Chapters,, International Water Management Institute.
    10. Isabel Lambrecht & Monica Schuster & Sarah Asare Samwini & Laura Pelleriaux, 2018. "Changing gender roles in agriculture? Evidence from 20 years of data in Ghana," Agricultural Economics, International Association of Agricultural Economists, vol. 49(6), pages 691-710, November.
    11. Gong, Stephen X.H. & Cullinane, Kevin & Firth, Michael, 2012. "The impact of airport and seaport privatization on efficiency and performance: A review of the international evidence and implications for developing countries," Transport Policy, Elsevier, vol. 24(C), pages 37-47.
    12. Belkhir, Mohamed & Ben-Nasr, Hamdi, 2016. "Labor protection and the privatization or partial privatization method," International Review of Economics & Finance, Elsevier, vol. 44(C), pages 305-322.
    13. Worku, Gebeyehu, 2005. "Has Privatization promoted Efficiency in Ethiopia?: A comparative Analysis Of Privatized Industries vis-a vis State Owned and other private Industrial Establishments," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 9(2), pages 132-132, May.
    14. Riham Ahmed Ezzat, 2015. "Paving the way for better telecom performance: Evidence from the telecommunication sector in MENA countries," Post-Print halshs-01164199, HAL.
    15. Alaa El-Shazly, 2011. "Auctions, Real Options Valuation, And Privatization," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 13(04), pages 403-415.
    16. Meinzen-Dick, R. & Nkonya, L., 2007. "Understanding legal pluralism in water and land rights: lessons from Africa and Asia," IWMI Books, Reports H040685, International Water Management Institute.
    17. Daphna Hacker, 2010. "The Gendered Dimensions of Inheritance: Empirical Food for Legal Thought," Journal of Empirical Legal Studies, John Wiley & Sons, vol. 7(2), pages 322-354, June.
    18. Mathur, Ike & Banchuenvijit, Wanrapee, 2007. "The effects of privatization on the performance of newly privatized firms in emerging markets," Emerging Markets Review, Elsevier, vol. 8(2), pages 134-146, May.
    19. Meinzen-Dick, R. & Nkonya, L., 2005. "Understanding legal pluralism in water rights: Lessons from Africa and Asia," IWMI Books, Reports H038746, International Water Management Institute.
    20. Bogart, Dan & Chaudhary, Latika, 2015. "Off the rails: Is state ownership bad for productivity?," Journal of Comparative Economics, Elsevier, vol. 43(4), pages 997-1013.
    21. Cantos, Pedro & Campos, Javier, 2005. "Recent changes in the global rail industry: facing the challenge of increased flexibility," European Transport \ Trasporti Europei, ISTIEE, Institute for the Study of Transport within the European Economic Integration, issue 29, pages 1-21.

    More about this item

    Keywords

    Public Enterprises; Government Policy and Regulation; Enterprise Policy;
    All these keywords.

    JEL classification:

    • L32 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Public Enterprises; Public-Private Enterprises
    • L52 - Industrial Organization - - Regulation and Industrial Policy - - - Industrial Policy; Sectoral Planning Methods
    • M38 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:82762. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.