NO TIMEFRAME TO REDUCE GOVT'S STAKE IN GLCs, SAYS NEAC CHAIRMAN

KUALA LUMPUR, May 24 (Bernama) -- The government does not have a specific
timeframe to transform state-owned enterprises or government-linked companies
(GLCs) into fully commercial companies in the process of gradual transition.

National Economic Advisory Council (NEAC) chairman Amirsham A Aziz,
in stating this, said the transformation of GLCs was however needed for the
government to become more focused as the country progressed.

"It has always been this kind of pressure for the government to exit from
business but no specific time for that. More important is to allow a continuous
process of the government in reducing its shareholding," he said.

He ws speaking to reporters after delivering a keynote address at the
"Network Meeting on Corporate Governance of State-Owned Enterprises in Asia"
here Monday.

Amirsham said in the Malaysian experience, GLCs undertaking public policy
objectives potentially presented a dilemma for long-term growth, hence the call
for reforms.

"We have no issue with the government owning shares in companies for
investment. But we are mindful that left unchecked, the dilemma that GLCs
present to policy makers will have a detrimental impact on the behaviour of
firms and ultimately, the economy of the nation," he said.

According to him, an overcrowding effect can be a powerful drag to the
economy in terms of competition, mindset and standards, mainly due to an
overly-protective shareholder.

For long-term growth, Amirsham said GLCs must be given the room to grow and
mature, and ultimately over time, become independent and be fully commercially
run.

He said the government, meanwhile, must take a more passive role and refrain
from the temptation to give preference to its investee companies by virtue of
its investment shareholding.

"The involment of the government should be confined only to the introduction
of new sectors such as alternative power generation as this would be highly
unlikely for the private sector to take up the challenge on its accord," he
added.

Amirsham also said that the government should focus more on governance
rather than business.
-- BERNAMA