STATE ENTERPRISES

State enterprise is a business entity established and owned by the government or state to provide vital and essential services to the public at a lower cost. 


The most common way of bringing a resource into public possession is called nationalization.


In essentially market-based economies, government-claimed resources are frequently overseen and run like joint-stock partnerships with the public authority possessing a controlling stake of the offers this model is regularly alluded to as a state-owned enterprises.


An administration claimed partnership (now and again state-owned enterprise, SOE) may look like a not-revenue driven organization as it may not be expected to produce a benefit.

Reasons why the state owns some businesses

* Strategic services: The state owns some l just to able to provide vital or strategic services like water, power etc. Which are very important to the lives of the people.

* Creation of employment avenues: State owned enterprises provide employment to the general public. For example, The state transport corporation employs a staff of drivers, mates, conductors etc. For its fleet of cars.
* Preventing exploitation of consumers: Most state owned enterprises are set up prevent or protect consumers against exploitation. For example, companies for vital service such as electricity and water cannons be left to private businessman becoming the service will be very important and the private men will be cheating the consumes.
* Infrastructure: Government establishes some states owned enterprises to be able to provide the needed infrastructure in the country. For example,  Accra Sports Stadium.

* National interest: Some state owned enterprises are set up to protect national interest. For example, Tema Oil Refinery, Team Steel Corporation, VALCO.
Importance of state owned enterprises

1 They safeguard the country against unfamiliar mastery.

2 They assist the public authority with controlling every one of the essential areas of the economy.

3 They give work to individuals in the country.

4 They give fundamental labor and products to customers at less expensive rate.


 


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