Nepal's public corporations have become a permanent drain on the economy. Most of them only have balance sheets which show losses, and many have not audited their books since the early 1990s. The situation of most is so bad that even privatising them is no longer an option, especially because of the cost of employee payoffs that need to made should the corporations be privatised. The annual review of the performance of public enterprises, published by the Ministry of Finance, tells the rest of the dismal story:
Total number of enterprises: 43; government has updated statistics for only 39
Total investment (shares and loans) up to 1999/00: Rs 71.24 billion
Investment (shares) up to 1999/00: Rs 19.94 billion
Investment (loans) up to 1999/00: Rs 53.29 billion
Total earnings in 1999/00: Rs 357 million, or 1.9 percent of investment.
Net profit in 1999/00: Rs 2.39 billion (25 percent lower than the year before)
Total employees: 47,178, an average of 1,210 per organisation.
The most bloated enterprises: Nepal Electricity Authority 9,289 staff; Rastriya Banijya Bank, 5,809; Nepal Telecommunication Corporation, 4,674; and Agricultural Development Bank, 4,628.
The estimates for 2000/01 are not very encouraging either: even monopolies like the Nepal Oil Corporation and Nepal Television (which the government helped to borrow money from NTC to set up satellite broadcasting) are expected to have operational losses. The only companies expected to do reasonably well are the Citizens Investment Trust, the Janakpur Cigarette Factory, the Nepal Stock Exchange and the NTC. The Ministry of Finance's review has all this data, but leaves the basic question untouched-why have the corporations at all?