The difficulty of reform stems from the nature of state-centered systems-- their financing, the many ancillary social functions that are performed by SOEs, and their systems of governance and control. Those attributes, we suggest, lead to predictable patterns of behavior in the reform process, and will explain why efficiency alone is unlikely to be an adequate motivator for reform. They also suggest that the process of reform is likely to become intertwined with reforms in other aspects of the economy, such as fuel markets, as well as reforms in financial markets, accounting practices and corporate governance. Financing, in particular, appears to be the key variable.

Our study on the experience of power market reform in five key developing countries is complete. Drafts of the individual country chapters are available below. Expect a book with results and finding in 2006.