Private costs of delayed privatization of TOT Public Company Limited

The purpose of this paper is to examine the private costs of delaying privatization of TOT Public Company Limited, a state-owned enterprise telephony carrier. To address the private costs of a delay in terms of privatization, a counterfactual forecasting model has been constructed for the years 2007-2012. The starting year of the evaluation is 2006, as this year was the deadline for privatization under the World Trade Organization (WTO) agreement. The forecasting model uses the traditional investment approach as well as scenario analyses. The traditional investment approach and sensitivity analyses provide similar results. Both show that the benefit of delaying the privatization process could be higher than if the WTO-agreed time process for TOT privatization were followed, as the growth of revenue sharing and from concessionaires would be higher than if TOT were privatized. There are no benefits in the long run, however, as the growth rate of revenue in the base case is lower than that in the privatization case, leading to a reduction in the present value of the base case over time: hence, the longer the delay in privatization, the slower the firm growth.