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State owned enterprises are public companies established by the act of parliament and control by the board of directors in order to produce essential services for the citizens. Some state owned enterprises are owned by the state government é.g 05BC while others are owned by the federal government e.g NPA, NRC etc.



(i) Huge capital outlay :- Public corporations exist because of the huge capital involved.

(ii) Welfarism :- Government set up state owned enterprises in order to enhance the well being of the citizens.

(iii) Equitable distribution of wealth public corporations are established in order to ensure even distribution of resources.



(i) Inefficient management: poor management affect the effectiveness of public corporation.

(ii) Corruption: political interference in the management of state owned enterprises promote corruption in the system.

(iii) Lack of willingness on the part of staff of public corporations affect the efficiency of the enterprises.




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