20 another 21 percent planning to open electricity markets to them (World Bank 2004). State ownership is most prevalent in low-income countries with weak institutional and regulatory capacities. Of the 47 Sub-Saharan African countries, for example, power utilities in 32 remain fully state-owned and operated, while only eight countries have had concession contracts and another seven have management or lease contracts (Gökgür 2004). But state ownership is not prevalent in Africa alone: a recent survey of nearly 20 low-income countries in different regions--including 11 in South Asia, East Asia, and Europe and Central Asia--shows that while many have corporatized their state-owned firms and/or brought in the private sector through IPPs, only one country (Mali) had private participation in distribution (while four are in advanced stages of the process), and only four countries had private participation in generation (Briceño-Garmendia et al 2004).

37. Similarly telecoms utilities are still owned and operated by the state in 60 percent of the developing countries included in the PPI database. State-ownership exists in virtually all regions. While Sub-Saharan Africa has had some successes with PPI (Mauritania, Uganda for example), the incumbent operator is still fully state-owned in 27 countries, seventeen of which have not initiated reform while the remaining ten are either stalled or delayed for political and/or market reasons (World Bank 2005). The remaining 20 countries in the region have had varying levels of private participation: one (Somalia) is fully private, 13 have majority private participation, and six involve minority share sales. In Latin America, telecom operators in 40 percent of the countries are still fully state-owned and operated, while in the Middle East, South Asia, and Europe and Central Asia the numbers are at 65, 60 and 30 percent respectively (ITU 2003).

38. The numbers for transport and water are substantially higher, with nearly 60 and 70 percent of developing countries respectively not having any form of private participation in these sectors. In transport, concessions have been concentrated in Latin America and East Asia, with relatively minimal activity in other regions.

_Financial sector_ 39. Privatization has decreased government ownership in the banking sector: in Europe and Central Asia, for example, the portion of total assets in state-owned banks declined from almost half in 1995 to less than 20 percent in 2003, with the biggest gain in EU accession countries compared to CIS countries; in Bulgaria, for example, 85 percent of the banking system has been privatized (Lieberman 2003).

40. But government ownership in developing countries has not been reduced to negligible levels: in South Asia, India--which represents half of the region’s activity--still has over 70 percent of total assets in public commercial banks, while in the Middle East and North Africa region as a whole 40 percent of assets remain in state-owned banks (Figure 11). Many developing countries in other regions still have at least 30 percent share of banking assets under state control. Among them: Albania, Argentina, Belarus, Brazil, Costa Rica, Romania, Russia, Thailand, Turkmenistan, and Uruguay (Clarke, Cull and Shirley 2003). In China, state banks remain a major liability: nonperforming loans of major financial institutions at the end of 2003 were equivalent to about 18 percent of the loans of the banks and 21 percent of GDP, with as much as 90 percent of loans regarded as government contingent liability (Caprio et al 2004).