State-owned enterprises (SOEs) are necessary the not only in the Vietnamese context but also in other countries in terms of economic development and macro management, according to Prime Minister Nguyen Xuan Phuc.
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Phuc mentioned the recently-launched Commission for the Management of State Capital (CMSC), dubbed as “super committee”, which should help SOEs realize its flagship role in the economy.
The CMSC’s main task is to supervise the use of state capital at 19 leading state-run groups and corporations, which manage a combined capital of VND1,000 trillion (US$43.02 billion) and assets of over VND2,300 trillion (US$99 billion).
According to Phuc, the government would minimize its interference in managing SOEs, and state firms should operates based on market mechanism.
Over the past few years, the restructuring process of state firms has gained positive results, especially in stabilizing macro-economy and trimming the number of SOEs from 12,000 to below 600, Phuc continued.
However, Phuc said there remain shortcomings among SOEs, including the disproportional contribution to the country’s economy despite huge resources they have access to, adding that corporate governance and technology application should be two priorities in the coming time.
Additionally, certain SOEs have not fully complied with the government’s instructions on SOEs selling and divestment, partly due to the concern of losing benefits after the companies are privatized.
In this context, the PM requested SOEs subject to be sold to proceed with the process in a transparent manner, preventing losses of state capital. Phuc said even efficient SOEs should be considered for privatization, which is key for greater corporate governance, attracting social investment and tackling corruption.
Post-privatization SOEs must be listed in the stock market, Phuc added.
The government would ensure no loopholes in the legal framework and preventing violations in the process of SOEs selling and divestment, he continued.
The number of wholly state-owned enterprises (SOEs) in Vietnam is projected to be reduced by five times from 500 currently to 100 by 2020, according to Vice Minister of Planning and Investment Nguyen Van Hieu.
Dang Quyet Tien, director of the Corporate Finance Department under the Ministry of Finance (MoF), informed that the divestment process resulted in proceeds of VND154.30 trillion (US$6.66 billion) from divesting VND16.46 trillion (US$710.88 million) in book value from 2016 to September 2018.
In the January – September period, the government raised VND9.14 trillion (US$394.87 million) from divesting VND3.77 trillion (US$162.88 million) in book value, Tien added.
