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Below are differences between commercialization and privatization;
Commercialization | Privatization |
The aim is to make state-owned Business more profitable | To transfer state-owned businesses to private individuals. |
The ownership still remains with the governement. | The ownership remains with the private investors. |
Commercialized businesses can still seek financial aid from the government in form of subvention. | Commercialized businesses may not be able to receive a financial allocation in form of subvention from the government. |
It does not intend to reduce the number of public enterprises but to make them more profitable. | It encourages the reduction in the number of public enterprises. |
It does not involve the sales of shares and assets held in public enterprises in the government. | It entails the selling of shares and assets held by the government in state-owned enterprises. |
It encourages the restructuring and reorganization of public enterprises and financial self-sufficiency. | It involves the passing of ownership of public enterprises toward profit maximization. |
Evaluation Questions:
1. Â Â Â Explain the term privatization.
2.   Sate three reasons for privatization.
3.   With not less than five reason, state the differences between commercialization and privatization.
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