Water supply system in Bosnia and Herzegovina, organised as set of public companies, operates inefficiently – substantial customers’ debt, enormous losses in network, insufficient investment means. Business failures of these companies are often attributed to public ownership and privatisation is mentioned as a solution to this problem. And then we ask ourselves a question – do we always have to learn from our own mistakes? Is it not easier to accept experience of others?
All the way up to the nineties European water supply systems (except France) were working under the auspice of the state governments. Treating water supply system as a public service, common interest service, as well as state ownership of the company, profit was not observed as primary goal of business activities within the hierarchy aims.
Water supply system of England, privatized in the nineties, confirms that the primary goal of the business activity in a private sector is only profit. Significant increase in investments is not recorded, the quality of service is not improved but significant increase in water price has happened. Promises of privatization advocates have not been fulfilled and pressure of English public on the authorities to return sector under state auspice has become stronger.
According to Friedman, when natural monopoly is involved, only choice between three evils remains: private irregular monopoly, private monopoly regulated by the state or state dealings. English experience shows us that private monopoly is not the solution. Therefore we have to choose what is best for poor Bosnian consumer.
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Датум:
15.06.2011.
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