Islamabad: Zafar Masud, Chairman of Oil and Gas Development Company Limited (OGDCL), highlighted the risks of privatizing state-owned enterprises without robust regulatory frameworks, suggesting it could lead to detrimental monopolies. Speaking at the Directors Summit 2024, he advocated for significant reforms in the energy sector, particularly concerning the privatization of distribution companies, which are a substantial financial burden.

According to Oil and Gas Development Company Limited, Zafar Masud spoke virtually at the event organized by the Pakistan Institute of Corporate Governance (PICG) in Karachi. He emphasized that while privatization could aid the financial issues of state-owned enterprises, it requires careful planning and the establishment of strong regulatory systems to prevent the creation of private sector monopolies that could undermine public utility services.

Masud also stressed the importance of selecting the right partners for privatization, focusing on those who are committed to long-term societal benefits rather than short-term financial gains. He expressed concerns over the potential consequences of choosing inappropriate partners, like private equity funds, which might not align with the long-term objectives of public services.

The chairman further highlighted the critical role of governance in both state-owned and private enterprises. He welcomed the new SOE Law as a step towards better governance but pointed out that such measures are only transitional. Masud called for independent regulators to oversee privatization and public-private partnerships, emphasizing that strong governance is key to the success and sustainability of these entities in contributing to Pakistan’s infrastructure and economic growth.