70 percent of targeted SOEs yet to conduct equitisation hinh anh 1Illustrative image (Photo: VNA)
Hanoi (VNA) – In the first six months of 2021, three businesses under the State-owned Vietnam Northern Food Corporation (Vinafood 1) and Vietnam National Coal - Mineral Industries Group (Vinacomin) had their equitisation plans approved by competent agencies, according to the Finance Ministry’s Department of Corporate Finance.

That raised the number of State-owned enterprises (SOEs) with approved equitisation plans between 2016 and June 2021 to 183, which have the total value of 489.943 trillion VND (over 21.35 billion USD), including 233.944 trillion VND of State capital.

Eighty-eight SOEs yet to publicise their value

The Department of Corporate Finance reported that among the 183 equitised SOEs, only 39 are in the Prime Minister-approved list of the 128 SOEs subject to equitisation, equivalent to 30 percent.

The 89 remaining firms, or 70 percent, must be equitised in the last six months of this year as scheduled. However, up to 88 of them have yet to publicise their value to serve equitisation.

The Ministry of Finance said it is overhauling many mechanisms and policies about equitisation, divestment of State capital, and restructuring of SOEs so as to help speed up the equitisation and divestment progress.

Data from the Department of Corporate Finance show that from 2016 to 2020, SOEs divested 27.312 trillion VND of State capital, collecting 177.397 trillion VND. Notably, the State Capital Investment Corporation (SCIC) divested 6.758 trillion VND of capital from 136 businesses, collecting 37.185 trillion VND.

In the first half of this year, the divested capital stood at 286.6 billion VND with 2.165 trillion VND collected.

There have been sufficient mechanisms for equitisation and capital divestment, but the progress so far this year still failed to meet expectations, the department said, attributing the problem to certain economic and political tensions in the region and the world, along with the COVID-19 pandemic’s impact on the domestic and regional financial and stock markets.

Besides, most of the SOEs undergoing equitisation, divestment, and restructuring during this period were large businesses that have complex financial situation, own much land, operate in the public utility sector, or play an important part in helping carry out social security strategies, this department noted.

Progress need to be accelerated

The Ministry of Finance said though the legal system for SOE restructuring has been geared towards enhanced transparency during the equitisation process and precise assessment of businesses’ value, many SOEs have not een ready to apply, leading to prolonged equitisation.

Some SOEs have not fully complied with legal regulations on the settlement of housing and land under their management. Meanwhile, most of others have not proactively handled land and housing in line with law but wait until they are forced to conduct equitisation to make the moves, which has also slowed down the equitisation progress.

Another important cause of the sluggishness is SOE leaders’ inadequate awareness of the equitisation, capital divestment, and listing of their firms in the stock market, the ministry pointed out.

Given this, it proposed the Prime Minister order ministries, sectors, and localities to push ahead with the equitisation of and divestment of State capital from SOEs.

For the short term, the Finance Ministry suggested the Government leader soon issue important mechanisms and policies such as a decision on the criteria for classifying SOEs, businesses invested with State capital, and non-business public units, and another approving the list of enterprises subject to equitisation and capital divestment in the 2021 - 2025 period.

It also requested SOEs to base on the promulgated legal documents to carry out equitisation and capital divestment on schedule./.