Analysis of performance of state owned enterprises : compression analysis of the Republic of Slovenia and Bosnia and Herzegovina

Abstract

One of the biggest questions battling governments around the world is performance of State Owned Enterprises (SOEs), as they are one of the biggest companies in every country and have a large share in economics growth and prosperity. Power, water and other types of independence of each country are mainly based on resources controlled by State Owned Enterprises. This issue became more important in last few decades due to globalization and market liberalization. Paper analyses performance of SOEs from the Republic of Slovenia and Bosnia and Herzegovina. To understands differences and similarities between SOEs from Bosnia and Herzegovina and Slovenia we have conducted a comparison analysis. Measuring the success of these SOEs is based on the analysis of financial statements for period from 2008 to 2012, using indicators of profitability and market indicators. The results reveal that SOEs from Bosnia and Herzegovina have poor governance and much lower performance than SOEs from Slovenia. The broad conclusion that emerges from the results is that government of Bosnia and Herzegovina has to conduct extensive reforms and reorganization of its S SOEs in order to survive and grow.