Vietnam raises US$88 million in state capital divestment in 11 months
Equitisation and divestment from SOEs have not reached the Government’s targets.
Equitisation and divestment from SOEs have not reached the Government’s targets.
Only seven state firms have completed their respective privatization process in the first nine months of 2020.
State firms that have completed the privatization process are expected to float shares on local bourses and create space for more foreign investors to invest in the local stock market.
Some large SOEs are facing difficulties in valuation, mainly due to complicated financial situations, which causes delays in the privatization process.
The special finance – budget mechanism would be implemented in the next five years.
This is mainly due to the government bond segment growing 10.5% quarter-on-quarter in the first quarter, to reach US$53.3 billion.
Household businesses not required to formalize into enterprises, and a new definition of state-owned enterprises are among the notable changes to the new law.
The responsibility of state-owned enterprises (SOEs) is to be pioneer in applying technologies and supporting socio-economic sustainable development.
Total capital expenditure in the 2016 – 2020 period would exceed the target of VND2,000 trillion (US$86.45 billion), accounting for 27 – 28% of total spending.
Experts have pointed out a number of hindrances to SOE privatization, including weak corporate governance, valuation methods and restricted foreign ownership.