This knowledge note has been prepared to assist CPSD TTLs to identify and conduct the analysis of State- Owned Enterprise (SOE) issues in the development of CPSDs, with a focus on implications for private sector development. This note builds upon the integrated State-owned Enterprises Framework (iSOEF) (World Bank, 2019l) and provides further guidance with respect to the resources, evidence, and options of SOE reform that could inform some policy reforms in the context of CPSD. This knowledge note can also be employed by a broader audience beyond CPSD teams as an analytical tool to understand the challenges and opportunities for the private sector that complement the iSOEF and explore further options of reform for PSD.

The main authors of this document are Dennis Sanchez Navarro (ETIMT), Tanja Goodwin (ELCDR) and Sunita Kikeri (EFNFS), under the technical guidance of Martha Martinez Licetti (Practice Manager, ETIMT), Mona Haddad (Director, CCEDR) and Caroline Freund (Director, ETIDR). The team would like to thank the valuable inputs, support and comments from Jean Saint-Geours (SSAA1), Jan Orlowski (ETIMT) and Georgiana Pop (ETIMT).

This document denoted as the knowledge piece is part of a 2-piece product prepared by the EFI Global Markets and Technology Unit to expose CPSD TTLs to the challenges and potential distortions than can be created in presence of SOEs in different markets as well as different policy alternatives to foster productive private-sector participation beyond full ownership transfer. The 2-products correspond to this CPSD SOE knowledge note and the CPSD SOE policy assessment tool, which jointly should be considered as complementary documents for a comprehensive approach to address the challenges related to SOEs when promoting higher private sector participation in an economy.