Restructure pilot groups, says PM

HA NOI (VNS) — The Prime Minister yesterday pulled the plug on two underperforming economic pilot groups after two years of trial operation. The axed groups, Viet Nam Housing and Urban Development Group (HUD) and Viet Nam Industrial Construction Group (VNIC), were two out of 11 pilot operations set up by the Government.

Pham Viet Muon, Government Office deputy director, said both groups have exposed their weaknesses in production and business efficiency, while failing to become key real estate contractors and to have a big influence on the property market.

He added that HUD and VNIC's operations were based on a matrix of subsidiaries with different functions, making them unsuitable for the current economic climate.

The two groups will be restructured as corporations with new duties and names. HUD turns into Housing and Urban Development Financial Investment Corporation while VNIC is converted into Song Da Corporation. Muon said all contracts signed with HUD and VNIC would be handed over to the two new corporations, while subsidiaries of the former groups would remain responsible for honouring contractual commitments and obligations

The Ministry of Construction will be solely responsible for overseeing the budget of the two corporations and responsible for managing seven 100 per cent -stake subsidiaries of former HUD and VNIC. The Minister of Construction would also appoint chairmen and board members for the two new corporations, said the PM's announcement

Muon said with the exception of ship-building group Vinashin, which has been being restructured following the conclusion of the Party Politburo, the eight remaining groups were running properly and satisfying State targets. — VNS

According to decision No 54/QD-TTg, an economic pilot group directly controlled by the government has responsibility for investing in different areas, while a corporation directly managed by a ministry is responsible for working in a targeted area.