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Question

Difficulty: MediumPublic Corporations: Organization, Commercialization, Privatization, and Control

Under Nigerian public enterprise reform policy, partial commercialization involves selling a minority portion of state-owned equity shares to private investors while retaining majority government ownership.

Answer: Answer

Answer

False. Commercialization does not involve the sale of government shares to private investors. Under both full and partial commercialization, the government retains complete (100%) ownership of the enterprise.
The statement is false because commercialization never entails the divestment or sale of state equity shares. In partial commercialization, public enterprises are expected to generate enough revenue to cover their operating expenses, but 100% of equity ownership remains strictly with the government.

Step-by-Step Solution

1
Define commercialization in public enterprise reform
Commercialization is the reorganization of state-owned enterprises to operate as profit-oriented, commercial ventures while retaining full government ownership.
Clarifies ownership boundary under commercialization policies.
2
Distinguish partial commercialization from privatization
Partial commercialization grants operational self-sufficiency without capital divestment, whereas selling shares to private investors constitutes privatization.
Differentiates structural reorganization from ownership transfer.

Key Concept

Distinction between commercialization and privatization in public enterprise reform
Estimated Time:1m 0s
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Topics

Public Corporations: Organization, Commercialization, Privatization, and Control

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