Privatization and Government Reform in the Philippines

Privatization in the Philippines has gained legitimacy in the light of two factors: 1) the inefficiencies and politicization of state-owned enterprises and 2) the perennial problem of low revenues and growing spending. However, privatization is also being advanced as part of an ideological offensive to reduce the size and scope of government. This paper raises the privatization level of principle in a quite distinct view of treating privatization as a policy instrument. It addresses contextual issues relating to efficiency, public revenue, and social welfare. But it is also a truism that privatization is not a panacea. It concludes that dogmatic view that the state and parastatals are inherently inefficient.