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2013-10-14 02:11
导读：a. Total Proceeds Raised by Privatization Programs It is clear that national governments have been among the biggest winners from privatization programs, since these have dramatically increased govern
a. Total Proceeds Raised by Privatization Programs
It is clear that national governments have been among the biggest winners from privatization programs, since these have dramatically increased government revenues, which is clearly one reason the policy has spread so rapidly. As mentioned above, Privatisation International [Gibbon (1998, 2000)] reports that the cumulative value of proceeds raised by privatizing governments exceeded $ 1 trillion sometime during the second half of 1999. As an added benefit, this revenue has come to governments without having to raise taxes or cut other public services.
b. Privatization's Impact on International Investment Banking
All international investment banks compete fiercely for share issue privatization mandates, for two principal reasons. First, because the offerings are so large and so visible--and are almost always designed to help promote the market's capacity to absorb subsequent stock offerings by private companies--these are very prestigious mandates. To date, the large US and British brokerage houses have had the most success in winning advisory and underwriting mandates, though all countries that launch large-scale SIP programs tend to favor local investment banks as "national champions" to& nbsp;handle the domestic share tranche. The second reason banks compete so fiercely for SIP mandates is because they can be extremely profitable. In spite of the fact--documented by Jones, et al (1999) and Ljungqvist, et al (2000)--that SIPs have significantly lower underwriting spreads than private sector offerings, their sheer size and lack of downside price risk make them very lucrative for underwriters.
2. Will this growth continue throughout the 2000s?
As we indicated above, the global capital market has grown so rapidly in recent decades cause of the privatizations rise. Privatizations increased the market liquidity. Now we have already stepped into the 21st century. I believe that the growth will continue for the following reasons. First, most of the south-east Asia countries have recovered from the 1997 financial crisis. For these countries, they now have the capital to do businesses. And they get back on the fast growing track. Second, by the end of 2001, world's biggest developing country, China, has ;entered the WTO (World Trade Organization). This is real great news. As we all know, today's China takes a serious position in world's economy. Its innovation and opening policy make china keep achieving high GDP growth rate. This drives the global capital market keep growing.
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Summary and Conclusions
This essay examines the impact of share issue privatizations (SIPs) on the growth of world capital markets (especially stock markets). I begin by documenting the increasing importance of capital markets, and the declining role of commercial banks, in corporate financial systems around the world. I then show that privatization programs-- particularly those involving public share offerings--have had a dramatic impact both on the development of non-US stock markets and on the participation of individual and institutional investors in those stock markets.
This has told the reason of the fast growth of global capital market. And then I succinctly indicated the continuance of the rapid growth, the great future.
The last but not the least is the recommendation. I can confidently assert that, if executed properly, a series of share issue privatizations can indeed promote the growth of global capital market, which will yield economic and political dividends for many years to come. That means there is a need to encourage the development of SIPs in order to gain growth of global capital market.
References
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The Economist (April 12, 1997), "Fragile, Handle With Care: A Survey of Banking In Emerging Markets."
The Economist (April 17, 1999), "On A Wing and A Prayer: A Survey of International Banking."
Gibbon, H., 1998, "Worldwide Economic Orthodoxy," Privatisation International 123, 4-5.
Gibbon, H., 2000, "Editor's Letter," Privatisation Yearbook, London, Thomson Financial, 1.
Gompers, P. and J. Lerner, 1998, "What Drives Venture Capital Fundraising?" Brookings Papers On Economic Activity--Microeconomics, 149-192.
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Jones, S.L., W.L. Megginson, R.C. Nash, and J.M. Netter, 1999, "Share Issue Privatizations As Financial Means To Political and Economic Ends," Journal of Financial Economics 53(2), 217-253
Kester, W.C., 1992, "Governance, Contracting and Investment Horizons," Journal of Applied Corporate Finance 5(2), 83-98.
Ljungqvist, A.P., T. Jenkinson and W.J. Wilhelm, Jr., 2000, "Has the Introduction of Bookbuilding Increased the Efficiency of International IPOs?" New York University Working Paper.
Maher, M. and T. Andersson, 1999, "Corporate Performance: Effects On Firm Performance and Economic Growth," OECD Working Paper (Paris).
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Porter, M.E., 1992, "Capital Choices: Changing the Way America Invests in Industry," Journal of Applied Corporate Finance 5(2), 4-16.
Tsuru, K., 2000, "Finance and Growth, Some Theoretical Considerations and A Review of the Empirical Literature," OECD Working Paper Series, No 228.
data from the Statistics section of the International Federation of Stock Exchange's website (www.fibv.com).
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