Privatization or Natural Growth of Private Sector

Improvement of doing business and investment climate is regarded as an approach to supplement privatization and this is evenrecognized by some as a substitute to privatization. The experience of Countries world over show that private sector can be flourished by two distinct ways: the first is transfer of ownership of assets and public companies to private sector and the second is removing of all the obstacles on the way of growth of private sector or in other words improving investment climate and facilitating doing business. The emphasize here is on factors affecting performance of firms such as quality of ruling power, the institutions, stability in rules and regulations and improving infrastructure. The aim of this paper is to show that as the experience of successful countries such as china clearly show improving doing business and Investment climate prove to be more effective and better way than privatization Policy as Experienced I n Eastern Europe for the growth and development of private sector.