Privatization in Eastern Europe & Latin America

This research examines the process of privatization of economic enterprises in Eastern Europe and Latin America. Where appropriate, privatization efforts in Argentina and Brazil are highlighted when considering privatization in Latin America, and privatization efforts in the Czech Republic and Poland are highlighted when considering privatization in Eastern Europe. Privatization efforts in these regions are compared with similar efforts in other regions, and where possible the privatization of telecommunications services is highlighted. The effects of privatization on the economies of the countries discussed generally and the effects on the foreign debt levels of these countries are discussed.

Privatization became, in the 1980s, a worldwide phenomenon, with 68 countries involved in such actions (Vuylsteke, 1988, pp. 111-1134). Telecommunications has been a sector involved in privatization efforts in several countries. The telecommunications industry in the United States was developed as a regulated monopoly. Technically, the organizations providing telecommunications services (primarily American Telephone & Telegraph, and General Telephone and Electronics) were private sector organizations. As regulated monopolies, however, service levels, prices, and even profits were regulated. Direct competition was absent (telecommunications companies were provided with protected market

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r the Western nations generally. Specifically, the Europeans concluded that the New Zealand experiment demonstrated that some degree of governmental involvement in business enterprise, and significant governmental regulation of economic activity is desirable ("The Kiwi Experiment..." 1990, p. 17). External Debt and Privatization Most of the world's developing countries had a massive net external debt in 1990 when the privatization efforts intensified. One hope held by most of these countries was that privatization would generate funds to retire much of the external debt. Of particular interest in this study are the external debt loads of Argentina, Brazil, the Czech Republic, and Poland. External debt data for these four countries are presented in Exhibit 1, which may be found on the following page. In order to assess the implications of the external debt of these countries, it is necessary to relate the external debt to other macroeconomic measures. Other macroeconomic measures of relevance are gross national product (GNP), gross domestic product (GDP), total exports, and net exports. The relevant relationships for the four countries are presented in Exhibit 2, which may be found on the following page. Exhibit 1 Exter
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Some common words found in the essay are:
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Approximate Word count = 5756
Approximate Pages = 23 (250 words per page)

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