SOE equitisation, divestment fall short of target: Ministry

The 11 SOEs have a total asset of approximately VND29.75 trillion (US$1.28 billion), of which the State owned over VND15.4 trillion (US$662.4 million), Dang Quyet Tien, Director General of the MoF’s Corporate Finance Department, told a press conference in Hanoi on November 19.

The event was held by the MoF to update the media on the conference on renovating and improving the efficiency of the SOE operation slated for November 21.

Under the initial plan, this year, HCM City had to equitise 39 enterprises, while the figure for Hanoi was 11, but not a single firm from either city has been equitised yet, Tien noted.

The divestment process in the first nine months was also sluggish and might fail to meet their goals for the year, Tien said, citing the fact that under the plan, there were 135 SOEs that had to undergo the divestment process in 2017 and 181 in 2018 but the State had divested capital from only 31 firms, 13 of which conducted the process in 2017 and 18 did so in 2018.

The 9-month divestment raised nearly VND10.5 trillion (US$451.7 million), far behind the last year’s total collection of VND138.3 trillion (US$5.95 billion) from divestment of SOEs, including leading brewery Sabeco and diary producer Vinamilk.

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

The hesitation of the firms’ leaders and the 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 Nguyen Hong 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.