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28-561: Caixa Econômica Federal ( Portuguese pronunciation: [ˈkajʃɐ ekoˈnõmikɐ fedeˈɾaw] , Federal Savings Bank ), also referred to as Caixa , is a state-owned Brazilian financial services company headquartered in Brasília , Brazil. It is the fourth largest banking institution in Brazil, as well as the fourth largest in Latin America , and the eighty-third largest bank in the world . It

56-661: A public objective. For that reason, SOEs primarily operate in the domain of infrastructure (e.g., railway companies), strategic goods and services (e.g., postal services, arms manufacturing and procurement), natural resources and energy (e.g., nuclear facilities, alternative energy delivery), politically sensitive business, broadcasting, banking, demerit goods (e.g., alcoholic beverages ), and merit goods (healthcare). SOEs can also help foster industries that are "considered economically desirable and that would otherwise not be developed through private investments". When nascent or 'infant' industries have difficulty getting investments from

84-489: A regular enterprise, state-owned enterprises are typically expected to be less efficient due to political interference, but unlike profit-driven enterprises they are more likely to focus on government objectives. In Eastern Europe and Western Europe , there was a massive nationalization throughout the 20th century, especially after World War II . In the Eastern Bloc , countries adopted very similar policies and models to

112-562: Is a viable argument for SOEs is debated. SOEs are also frequently employed in areas where the government wants to levy user fees , but finds it politically difficult to introduce new taxation. Next, SOEs can be used to improve efficiency of public service delivery or as a step towards (partial) privatization or hybridization. SOEs can also be a means to alleviate fiscal stress, as SOEs may not count towards states' budgets. Compared to government bureaucracy, state owned enterprises might be beneficial because they reduce politicians' influence over

140-573: Is also the largest 100% government-owned financial institution in Latin America . The bank was founded by Emperor Pedro II on 12 January 1861, as Caixa Economica e Monte de Socorro in Rio de Janeiro as a financial institution destined to collect national savings , mostly from the poor. Over the years, several similar institutions were created, until most of them were merged into present-day Caixa Econômica in 1967. The 1970s were particularly lucrative for

168-640: Is an organisation that forms part of New Zealand 's state sector established under the Crown Entities Act 2004 , a unique umbrella governance and accountability statute. The Crown Entities Act is based on the corporate model where the governance of the organisation is split from the management of the organisation. Crown entities come under the following types: Crown entities can be contrasted with other New Zealand public sector organisational forms: departments of state , state-owned enterprises , offices of Parliament and sui generis organisations like

196-753: Is approximately 70% of total employment. State-owned enterprises are thus a major factor behind Belarus's high employment rate and a source of stable employment. In most OPEC countries, the governments own the oil companies operating on their soil. A notable example is the Saudi Arabian national oil company , Saudi Aramco , which the Saudi government bought in 1988, changing its name from Arabian American Oil Company to Saudi Arabian Oil Company. The Saudi government also owns and operates Saudi Arabian Airlines , and owns 70% of SABIC as well as many other companies. China's state-owned enterprises are owned and managed by

224-886: Is difficult to determine categorically what level of state ownership would qualify an entity to be considered as state-owned since governments can also own regular stock , without implying any special interference). Finally, the term "enterprise" is challenged, as it implies statutes in private law which may not always be present, and so the term "corporations" is frequently used instead. Thus, SOEs are known under many other terms: state-owned company, state-owned entity, state enterprise, publicly owned corporation, government business enterprise, government-owned company, government controlled company, government controlled enterprise, government-owned corporation, government-sponsored enterprise , commercial government agency, state-privatised industry public sector undertaking, or parastatal, among others. In some Commonwealth realms , ownership by The Crown

252-602: Is highlighted in the predominant local terminology, with SOEs in Canada referred to as a " Crown corporation ", and in New Zealand as a " Crown entity ". The term " government-linked company " (GLC) is sometimes used, for example in Malaysia , to refer to private or public (listed on a stock exchange) corporate entities in which the government acquires a stake using a holding company . The two main definitions of GLCs are dependent on

280-489: Is seen as a tool for public investment and expansion of access to financial services to the Brazilian public. Caixa is still the manager of most Brazilian lotteries, especially the most popular ones, such as Mega-Sena , Quina and Loteca (former Loteria Esportiva). The profits of Brazilian state (federal) lotteries revert to amateur sport promotion and elementary education. State-owned enterprise The terminology around

308-442: Is the second-biggest Brazilian bank, and with locations in thousands of Brazilian towns, ranked the third-largest financial institution in Brazil by number of branches. Caixa has more than 146 million accounts, with liabilities worth more than R$ 237.00 billion in savings or investment. Together with government pension funds and other governmental resources, Caixa controls more than R$ 1.80 trillion (roughly about US$ 630 billion). Caixa

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336-814: The Reserve Bank . Under the Crown Entities Act, ministers are required to "oversee and manage" the Crown's interests in the Crown entities within their portfolio (sections 27 and 88). The board of the entity has the key role in ensuring the entity is achieving results within budget. This is done by a monitoring department on behalf of the minister unless other arrangements for monitoring are made. Monitoring departments make explicit agreements with their minister, setting out what monitoring they will undertake and how they will do it. Crown entity boards should also facilitate clear and transparent monitoring, for example, by providing

364-703: The State-owned Asset Supervision and Administration Commission (SASAC) . China's state-owned enterprises generally own and operate public services, resource extraction or defense. As of 2017 , China has more SOEs than any other country, and the most SOEs among large national companies. China's SOEs perform functions such as: contributing to central and local governments revenues through dividends and taxes, supporting urban employment, keeping key input prices low, channeling capital towards targeted industries and technologies, supporting sub-national redistribution to poorer interior and western provinces, and aiding

392-436: The 1980s, with many other banks introducing savings accounts to their portfolios, Brazilian states being granted rights to hold their own lotteries in addition to the federal government's, a series of corruption scandals regarding lottery fraud, and the opening of the national market to foreign banks. The control of inflation also hampered Caixa's financial performance by making savings accounts less attractive. Nowadays, Caixa

420-833: The Minister of Finance II, the Minister in the Prime Minister's Department in charge of the Economic Planning Unit, the Chief Secretary to the Government, Secretary General of Treasury and the heads of each of the GLICs (the Employees Provident Fund, Khazanah Nasional Berhad , Lembaga Tabung Angkatan Tentera (the armed forces pension fund), Lembaga Tabung Haji and Permodalan Nasional Berhad . Khazanah Nasional Berhad provided

448-1003: The USSR. Governments in Western Europe, both left and right of centre, saw state intervention as necessary to rebuild economies shattered by war. Government control over natural monopolies like industry was the norm. Typical sectors included telephones , electric power , fossil fuels , iron ore , railways , airlines , media , postal services , banks , and water . Many large industrial corporations were also nationalized or created as government corporations, including, among many others: British Steel Corporation , Equinor , and Águas de Portugal . A state-run enterprise may operate differently from an ordinary limited liability corporation. For example, in Finland, state-run enterprises ( liikelaitos ) are governed by separate laws. Even though responsible for their own finances, they cannot be declared bankrupt ;

476-421: The bank, mostly due to its near-monopoly on savings for the poor and lower-middle classes, the management of Brazilian state (federal) lotteries and being the only lawful pawn broker in Brazil. In the 1990s, however, the scenario changed and the bank underwent a serious downsizing, in which thousands of employees lost their jobs. Part of the problem was caused by the modernization of the Brazilian banking system in

504-500: The form of Public Sector Undertakings (PSUs). The Malaysian government launched a GLC Transformation Programme for its linked companies and linked investment companies ("GLICs") on 29 July 2005, aiming over a ten-year period to transform these businesses "into high-performing entities". The Putrajaya Committee on GLC High Performance ("PCG"), which oversaw this programme, was chaired by the Prime Minister , and membership included

532-412: The leading application of the incomplete contract theory to the issue of state-owned enterprises. These authors compare a situation in which the government is in control of a firm to a situation in which a private manager is in control. The manager can invest to come up with cost-reducing and quality-enhancing innovations. The government and the manager bargain over the implementation of the innovations. If

560-592: The negotiations fail, the owner can decide about the implementation. It turns out that when cost-reducing innovations do not harm quality significantly, then private firms are to be preferred. Yet, when cost-reductions may strongly reduce quality, state-owned enterprises are superior. Hoppe and Schmitz (2010) have extended this theory in order to allow for a richer set of governance structures, including different forms of public-private partnerships . SOEs are common with natural monopolies , because they allow capturing economies of scale while they can simultaneously achieve

588-399: The private sector (perhaps because the good that is being produced requires very risky investments, when patenting is difficult, or when spillover effects exist), the government can help these industries get on the market with positive economic effects. However, the government cannot necessarily predict which industries would qualify as such 'infant industries', and so the extent to which this

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616-428: The proportion of the corporate entity a government owns. One definition purports that a company is classified as a GLC if a government owns an effective controlling interest (more than 50%), while the second definition suggests that any corporate entity that has a government as a shareholder is a GLC. The act of turning a part of government bureaucracy into a SOE is called corporatization . In economic theory ,

644-451: The question of whether a firm should be owned by the state or by the private sector is studied in the theory of incomplete contracts developed by Oliver Hart and his co-authors. In a world in which complete contracts were feasible, ownership would not matter because the same incentive structure that prevails under one ownership structure could be replicated under the other ownership structure. Hart, Shleifer, and Vishny (1997) have developed

672-570: The secretariat to the PCG and managed the implementation of the programme, which was completed in 2015. As of 2024, Philippines Amusement and Gaming Corporation (PAGCOR) is the most profitable state-owned enterprise in the Philippines. It is the third largest contributor to government revenues, following taxes and customs. Crown entity A Crown entity (from the Commonwealth term Crown )

700-469: The service. Conversely, they might be detrimental because they reduce oversight and increase transaction costs (such as monitoring costs, i.e., it is more difficult and costly to govern and regulate an autonomous SOE than it is the public bureaucracy). Evidence suggests that existing SOEs are typically more efficient than government bureaucracy, but that this benefit diminishes as services get more technical and have less overt public objectives. Compared to

728-465: The state answers for the liabilities. Stocks of the corporation are not sold and loans have to be government-approved, as they are government liabilities. State-owned enterprises are a major component of the economy of Belarus . The Belarusian state-owned economy includes enterprises that are fully state-owned, as well as others which are joint-stock companies with partial ownership by the state. Employment in state-owned or state-controlled enterprises

756-493: The state's response to natural disasters, financial crises and social instability. China's SOEs are at the forefront of global seaport-building, and most new ports constructed by them are done within the auspices of the Belt and Road Initiative . As of at least 2024, an Ethiopian SOE is Africa's largest and most profitable airline, as well as Ethiopia's largest earner of foreign exchange. In India , government enterprises exist in

784-439: The term state-owned enterprise is murky. All three words in the term are challenged and subject to interpretation. First, it is debatable what the term "state" implies (e.g., it is unclear whether municipally owned corporations and enterprises held by regional public bodies are considered state-owned). Next, it is contestable under what circumstances a SOE qualifies as "owned" by a state (SOEs can be fully owned or partially owned; it

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