The interim government has revived a plan to divest government shares in the multinational companies on the stock market after the previous initiative bore no major fruits over the past two decades.
Stock market experts doubt the success of the current initiative, too, as this one is also similar to the step taken in 2005 for bringing quality shares to the market after the 1996 bubbles.
However, the success of the initiative was limited to offloading some shares of the fully state-owned companies to the market.
Efforts during 2008-09 under the military-backed caretaker administration also failed to convince the MNCs to divest certain portion of their own and government shares for the general investors.
Following the share market collapse in December 2010 and January 2011, the initiative remained almost shelved over the past 15 years while the local share market continued to face dearth of good shares.
Bangladesh Institute of Capital Market director Mahmood Osman Imam identified structural weaknesses for the failure in the implementation of the decision.
Bureaucrats enjoying privileges as directors in the MNCs should be blamed for the abortive attempts, said Osman Imam, also the dean of the Business Studies at the Dhaka University.聽
Had the government appointed non-bureaucrats as directors in the MNCs and fixed specific deadlines for implementation, the initiative could have been more practical, said experts.
Like the previous occasions, the ministries and divisions which represent the government in the MNCs have been asked to take measures to divest shares on the market via the Investment Corporation of Bangladesh and its subsidiary ICB Capital Management.
Ten firms, including six multinationals, namely Unilever, Nestl茅, Novartis, Syngenta, Synovia (formerly Sanofi Bangladesh), and Karnaphuli Fertiliser Company have been shortlisted for the divestment of 5 per cent of their shares.
The government holds roughly 40 per cent stakes in most of the multinationals.
ICB Capital Management chief executive officer Mazeda Khatun hoped that the current initiative would materialise the much-vaunted efforts to bring the MNCs on the market.
Like in other countries, MNC shares will strengthen the local share market and increase its image and restore confidence of the investors in the share market.聽
Institute of Chartered聽 Accountants of Bangladesh council member Md Shafiqul Alam said that the MNC shares would be very popular in the market since many of them are making huge profits.
But they are reluctant to share profits with general investors, said Alam while blaming the regulator for failing to bring the MNCs to the market.
Of the more than 400 MNCs doing business in Bangladesh, only 16 companies are listed in Bangladesh.聽聽
No multinational company was listed after 2010.
The same MNCs that are listed in India, Pakistan, and Sri Lanka have been operating in Bangladesh without being listed in the market, said experts, adding that the government had no laws like the other countries to bring them to the market.
On July 31, a meeting presided over by Aniusuzzaman Chowdhury, special assistant for the Ministry of Finance, decided to formulate an ordinance to bring the MNCs to the share market in addition to revising the plans to offload certain government shares for general investors.
However, the Financial Institutions Division under the finance ministry is yet to prepare for issuing the ordinance by December.
An FID official said that the division was concentrating on the divestment of certain government shares in the MNCs for general investors.
Initiatives to promulgate the ordinance will be taken if the current effort becomes unsuccessful, added the official.
