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State enterprises to restructure

Update: July, 24/2012 - 10:39

 

Workers at the construction of Nhat Tan Bridge in Phu Thuong Ward, Tay Ho District, Ha Noi. All State-backed economic groups and corporations must end investments in non-core business by 2015 under a new restructuring plan approved by the Prime Minister. — VNA/VNS Photo Huy Hung
HA NOI — Prime Minister Nguyen Tan Dung has approved a project to restructure State-owned enterprises (SOEs).

All these economic groups and corporations must end investments in non-core business lines before 2015.

The ministries and sectors must re-arrange, restructure or dissolve enterprises that are inefficient and have no way of paying their debts.

It is intended that the SOEs be given a more reasonable production and business structure, made to concentrate on their core business lines, and provide public services and products for society, defence and security.

The hope is that this will enable them to play a decisive role in regulating and stabilising the macro-economy.

The restructuring is also aimed at improving competitive ability and returns on equity.

The project aims to promptly approve plans to renovate enterprises made by ministries, sectors, provinces, cities, economic groups and SOEs themselves.

Enterprise renovation plans must be submitted to relevant offices for approval by the third quarter of this year, said the Prime Minister.

The enterprises must build plans on restructuring their financial sector so that they hold on to just their core businesses while resolving any ongoing financial problems.

Corporations and economic groups with difficulties in finance should restructure capital and assets to find capital for urgent projects, limiting losses and merging inefficient projects.

Nguyen Duc Kien, deputy chairman of the National Assembly's Economic Committee, said each corporation and economic group must withdraw capital from non-core business based on the principle of preserving their equity.

This was hard work, Kien said, because profit from non-core business was often higher than from the main business.

Tran Dinh Thien, head of the Viet Nam Economic Institute, said that to promote the restructure of SOEs, State management offices should focus on inspecting, supervising and controlling SOEs.

Nguyen Dinh Cung, deputy head of the Central Institute for Economic Management, said the State should demand transparency because the State could not properly supervise the efforts without it. — VNS

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