The benefit comes by an improved product or facility, and in time often at a lower price. This has been proven in developing countries as indeed in the western world. Privatization can be the way forward to a vibrant economy. You have indicted that developing countries are in confusion in the process of privatisation. You have experienced Nepalese process and model.
Privatisation is a sensitive subject in many developing countries.
Unfortunately almost all of the State Owned Enterprises are overmanned, often through politicians using the S.O.E's as a source to give employment to friends or relatives. As a result if an SOE is listed for privatisation, as it is usually incurring heavy losses, and it is known that in the event of a private investor taking over there would inevitably be redundancies. For the most part the SOE's are managed by inadequately qualified personnel, particularly in management. Most of Senior Management have been appointed by Government, often not by their experience and ability, but merely by association. Nepal can offer attractive opportunities for foreign investors, particularly in the Hydro-Power sector which would need a considerable investment to expand its services as indeed Government would like.