Teachers Notes for Business Studies
Summary: Private vs. Public Sectors
1. The public sector is made up of agencies and institutions owned and operated by the government, while the
private sector is made up of small businesses, corporations, as well as profit and non-profit organizations.
2. The public sector is not profit-driven, while this is the case with the private sector.
3. The end beneficiary of the services offered by the public sector is the general public, while it is the general
consuming public who take advantage of the goods and services offered for profit by the private sector
businesses.
The public sector
The main purpose is to provide essential goods and services that cannot be left to private sector businesses.
Other than health and education, defence and police; it may also include industries such as energy,
telecommunications and public transport.
The main aim of public sector businesses is to provide a service to the public in the areas of the country. To
keep people in jobs so that unemployment does not rise. To keep prices low so that everybody can afford the
services. To break even, the point of sales where there is no profit neither a loss.
Here we talk of the public corporations, which are businesses established by law and is wholly or partially
owned by the government. President appoints a board of directors, who appoint a managing director. e.g. NBC,
which provides radio and television services in Namibia. Nampower, generates and provide electricity in
Namibia. Namcor, handles exploration for oil and gas and planning for the development of a petroleum
industry. The Namibia Development Corporation (NDC) promotes, develops, and support all the sectors of the
Namibian economy.
Government owned companies, where government is the only shareholder of that company. The relevant
minister appoints the board of directors, who in turn appoints the managing director. E.g. Namwater, It provides
clean water for human and animal consumption. TransNamib, operates roads, rail, harbor and air transport.
Nampost, provides postal services, etc.
Statutory institutions, are established by law. E.g. Agricultural Bank of Namibia, which finances both
commercial and communal farming activities. It is self-funding. Under the control of the Minister of finance,
board of directors appointed by the president.
The private sector
Main aim is to make profit. The government has little or no control in the running of these businesses. In
Namibia, there are different types of business organisations in the private sector, e.g. sole-traders, partnerships,
close corporations, multinationals, joint ventures and franchises. They are usually small, although some are very
large such as public companies.
E.g. Shoprite, Pupkewitz Holdings; Game; Pep stores. Can you name other more?
So we have learnt that some businesses are privately owned and others owned by government. The ownership
can be changed either when government sells to the private sector or when government buys from the private
sector which is what we are going to discuss next.
Lesson Plan
13International University of Management: Faculty of Educational, Administration and Management: Form 3a