ABSTRACT
This project involved the study of Kaduna Refining and Petrochemical Company Limited (KRPC) with respect to the impact of current economic policies on the profitabilitx of Government commercialised enterprises.
The study is aimed at providing useful information on KRPC to its Management and Bureau for Public Enterprises (BPE) as well as lid government in "carefidly managing the privatisation exercise being contemplated in order to ensure that the country obtains its maximum benefits. Secondary data from primary sources on the past performances of the KRPC plants as well as the macroeconomic indicators of the nation for the recent past years were sourced
and relied upon for analysis. Wide the Fuels plants maintained a fairly stead) capacity utilisation of about 65% with a slight improvement in 1995 to 71.04%, the Lubes plant showed a downward movement with its highest value of 35.19% in 1992 and recording its lowest value of 7.29% in 1995. That of the Petrochemical plant, with the exception of 1993, consistently declined also.
The Products Value Index (PVI), being an efficiency performance index for both the Refining and the Petrochemical plants, increased steadily from its lowest value of 41.93% in 1993 to its highest value of 71. 77%) in 1996. This showed a steady improvement in the overall efficiency in the running of the KRPC Rt fining <%f Petrochemical plants, based on the available resources.
The Manufacturing plant capacity utilisations only ranged between 1.287c and 26.22 %! Only in 1991 and 1992 did the ROls achieved by this outfit meet the NNPC Corporate acceptable value of 20% on its investments.
The general impact of the economic policies on commercialised enterprises therefore had been a resultant high cost of borrowing and sourcing of required inputs (especially imported ones), leading to high cost of products or services rendered and the subsequent decrease in plants capacity utilisations. Tlie bottom line is that profirabilirx is decreased or hindered as advantage could no longer be taken on economies of scale. Also, in the
case ofKRPC, the enabling commercial environment is yet to be fully put in place. This has hindered overall competitive performance.
