The evolving role of State-owned enterprises (SOEs) in the economy and its implications for Vietnam came to the forefront of discussions at a workshop held in Hanoi on March 4.

In order to equitise SOEs and reform their operations, it is necessary to improve business management and quality, said Minister of Planning and Investment Bui Quang Vinh.

Over the past two decades, Vietnam has continuously restructured State-run businesses, which numbered 12,000 in 1990 and have dropped to 5,600 at present.

SOEs possess over 3,000 trillion VND (141 billion USD) worth of assets, including 1,100 trillion VND (51.7 billion USD) of State capital. While constituting only one percent of the total businesses nationwide, SOEs are dominating many important economic sectors. They contribute 85 percent of the electricity and oil and gas output, 90 percent of telecommunication services, and 56 percent of financial-credit services to the economy.

However, the operational efficiency and the role of SOEs in the national economy remain controversial, Vinh said, adding that the proportion of equitised SOEs among big corporations is very low.

Attending the workshop, former British Prime Minister Tony Blair said the question for Vietnam is how to build on its achievements to create more opportunities and prosperity, and reforming SOEs is part of the answer.

He shared that reforming SOEs helped the UK attracted significant foreign direct investment over the past three decades.

Experts from Tony Blair’s office said the Vietnamese Government should clarify whether it pursues equitisation in order to shift to a market economy, improve the SOEs’ operational efficiency and reduce Government debts, or does so because of international pressure.

With a clear goal, the Vietnamese Government can set its priority in privatising SOEs and developing suitable policies to support the efforts.

The former British Prime Minister confirmed that the UK will continue to cooperate with Vietnam and share its experience in the field.

Minister Bui Quang Vinh also stated that the SOEs are a core force of the economy, but their presence should be narrowed in several fields.

He called for foreign recommendations and support to define the evolving role of SOE’s in the new economic context.-VNA