IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/82762.html

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, July.
    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. M. Casari & M. Lisciandra, 2013. "Gender Discrimination in Property Rights," Working Papers wp914, Dipartimento Scienze Economiche, Universita' di Bologna.
    2. Anastassios Gentzoglanis, 2002. "Privatization, Investment and Efficiency in the Telecommunications Industry: Theory and Empirical Evidence from MENA Countries," Working Papers 0230, Economic Research Forum, revised 10 Oct 2002.
    3. repec:dgr:rugsom:01a21 is not listed on IDEAS
    4. Ichiro IWASAKI & Satoshi MIZOBATA, 2018. "Post-Privatization Ownership And Firm Performance: A Large Meta-Analysis Of The Transition Literature," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 89(2), pages 263-322, June.
    5. Bezabih, Mintewab & Holden, Stein, 2010. "The Role of Land Certification in Reducing Gender Gaps in Productivity in Rural Ethiopia," RFF Working Paper Series dp-10-23-efd, Resources for the Future.
    6. 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.
    7. Megginson, William Leon, 2005. "The Financial Economics of Privatization," OUP Catalogue, Oxford University Press, number 9780195150629.
    8. 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.
    9. John Nellis, 2003. "Privatization in Latin America," Working Papers 31, Center for Global Development.
    10. Diao, Xinshen & Roe, Terry L. & 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).
    11. Parker, David, 2001. "Economic Regulation: A Preliminary Literature Review and Summary of Research Questions Arising," Centre on Regulation and Competition (CRC) Working papers 30616, University of Manchester, Institute for Development Policy and Management (IDPM).
    12. 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.
    13. 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.
    14. Dassler, Thoralf & Parker, David & Saal, David S., 2006. "Methods and trends of performance benchmarking in UK utility regulation," Utilities Policy, Elsevier, vol. 14(3), pages 166-174, September.
    15. Aidoo, J. B. & Otsuka, Keijiro & Payongayong, Ellen & Quisumbing, Agnes R., 1999. "Women's land rights in the transition to individualized ownership," FCND discussion papers 58, International Food Policy Research Institute (IFPRI).
    16. 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.
    17. 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.
    18. Sosale, Shobhana, 2000. "Trends in private sector development in World Bank education projects," Policy Research Working Paper Series 2452, The World Bank.
    19. Varley, Ann, 2007. "Gender and Property Formalization: Conventional and Alternative Approaches," World Development, Elsevier, vol. 35(10), pages 1739-1753, October.
    20. 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.
    21. Sergey Sinelnikov & Pavel Kadochnikov & Ilya Trunin & Sergey Chetverikov & Marianne Vigneault, 2006. "Fiscal Federalism in Russia: Soft Budget Constraints of Regional Governments," Published Papers 47, Gaidar Institute for Economic Policy, revised 2012.

    More about this item

    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.