CEED Institute je izdal zanimivo poročilo “How much state in the economy?”, v kateri nekaj uglednih osebnosti (med njimi Leszek Balcerowicz, András Inotai, Horst Köhler, Ivan Mikloš, …) ter moja malenkost) razpravlja o vlogi države v gospodarstvu.

Moj prispevek se nanaša na vlogo države v slovenskem gospodarstvu v dveh desetletjih po začetku tranzicije. Poanta teksta je, da je bila v Sloveniji država preveč aktivna na napačnih mestih (kot aktivna ali pasivna lastnica) in premalo aktivna tam, kjer bi morala biti (kot regulator trga). Spodaj je kratek izsek iz teksta, celoten tekst ter prispevki ostalih avtorjev pa so dostopni v CEED dokumentu.

While the ongoing economic crisis raised serious doubts about the self-regulatory nature of markets and showed that redefinition was needed of the role of the state in the economy, this does not necessarily apply to Slovenia. At least not to the same extent. In the last two decades in Slovenia one can hardly talk about the dominant role of the markets in determining social outcomes. It is rather a combination of the unfinished privatization, insufficient regulation and lack of supervision that caused much of the problem. While in most countries it was reckless lending by the insufficiently regulated private banks to private firms that set the stage for the crisis, in Slovenia it was mostly the politically motivated lending policies of the poorly regulated state-owned banks to state-controlled and insufficiently regulated firms. There was too much government in the wrong place and too little government where it was needed.

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Looking back, it is straightforward to see how unfinished privatization and large state involvement in companies and banking sector contributed to the credit boom and capital bubbles by encouraging managers to engage in taking excessive risks in borrowing for management buy-outs and takeovers. This bears several important lessons for the future regarding the role of the state in the economy.

First, large direct state involvement in firms where this is neither required nor justified by the strategic considerations of the society is to be reduced to a reasonable level. Privatizing the banking sector is the first priority, which will contribute to breaking the ties between the state-controlled firms and the state-owned banks as well as inhibit politically motivated lending policies of the banks. Privatization should continue also in other sectors where direct state intervention is not required and in sectors where uncertainty about the efficiency of regulation is low. One should not mistake this call for privatization with the imposed urge by the European Commission for quick privatization. In the current circumstances, it would be akin to selling the capital stakes in state-owned firms at fire-sale prices. This is neither necessary nor optimal in the short run. On the contrary, it should be done in a well designed and transparent process to maximize the outcomes and to prevent from similar potential future episodes.

Second, while a central agency for management of state capital shares (i.e. Slovenian state holding, SDH) has been established, the government has to ensure a sufficient degree of its autonomy as well as its transparency and accountability in managing the state capital investments. So far, political interventions and direct political influence regarding the appointment of supervisory boards in individual state-owned firms have been the rule rather than the exception. A new strategy for managing the state capital investments seems to go in the right direction by defining the autonomy of the SDH and ensuring that its mandate involves following the OECD Guidelines and its best practices.

Finally, a third lesson is that regulatory processes have to be strengthened and organized in a way to provide for regulation under the law and independence, transparency and credibility. Sectoral strategies should be adopted to define the objectives of government regulation and to ensure its predictability and legitimacy. This means that old practices of favoring incumbents and discriminating against new private firms and foreign competitors have to be dismantled in order to achieve optimal outcomes for the society.

To conclude, there is a need in Slovenia to reshuffle the role of the government and to reallocate it from the wrong place to where it is really needed.

Vir: Jože P. Damijan, CEED Institute Report “How much state in the economy?”