Tuesday, December 11 2018

VietNamNews

SOE equitisation moves slower than expected

Update: November, 20/2018 - 09:00
Đặng Quyết Tiến, director general of the Ministry of Finance’s Corporate Finance Department, addresses a meeting on SOEs’ equitisation in Hà Nội on Monday. — VNS Photo Linh Anh
Viet Nam News

HÀ NỘI — The equitisation of State-owned enterprises (SOEs) is unlikely to meet this year’s target, as only 11 SOEs had completed the process by the end of September.

Việt Nam plans to complete the equitisation of 85 SOEs this year, 64 of which are large companies.

This information was released by Đặng Quyết Tiến, director general of the Ministry of Finance’s Corporate Finance Department, during a meeting in Hà Nội on Monday.

“According to the initial plan, in 2018, HCM City had to equitise 39 enterprises, while the figure for Hà Nội was 11, but not a single firm from either city has been equitised yet,” Tiến told the meeting.

Regarding State capital divestment, Tiến said the divestment process during the first nine months was also sluggish and might fail to meet their goals for the year.

“Under the plan, there were 135 SOEs that had to undergo the divestment process in 2017 and 181 in 2018,” he said. “However, the State has divested capital from only 31 firms, 13 of which conducted the process in 2017 and 18 of which did so in 2018.”

The country reaped VNĐ5.06 trillion (US$216 million) from 18 SOEs in the first six months of this year.

Tiến also pointed out the units that did not complete divestment in 2017. Incomplete processes included the divestment of the Ministry of Industry and Trade from the Việt Nam Engine and Agricultural Machinery Corporation with a total divestment value of VNĐ7 trillion, the divestment of the Ministry of Health from the Việt Nam Pharmaceutical Corporation with a value of VNĐ829 billion and the divestment of the Ministry of Construction from eight enterprises with a total value of VNĐ2.4 trillion.

Tiến attributed the delay of SOEs equitisation and State capital divestment to inadequate measures from the ministries, branches and localities involved in the process.

“The firms’ leaders’ hesitation and lack of assertiveness are the cause,” he said, adding that the economy’s capacity to absorb capital of businesses remains weak.

Equitisation and divestment encountered many obstacles, notably the influence of interest groups and difficulties in the search for consultants, enterprise evaluations and approval of land use plans and complicated pre-equitised auditing processes of big corporations.

Authorities need to strengthen inspection and supervision, as well as sanction leaders of delaying SOEs. It is also necessary to revise the list of SOEs awaiting equitisation and divestment and urge them to follow the plan, said Nguyễn Hồng Long, deputy head of the Government’s Steering Committee for Enterprise Renovation and Development.

If enterprises registered to equitise in 2017 but fail to do in 2018, Long said, they should be transferred to the State Capital Investment Corporation, the Government agency that oversees most SOEs. — VNS

Send Us Your Comments:

See also: