Illustrative photo (Photo: VNA) Hanoi (VNA) – The equitisation ofState-owned enterprises (SOEs) needs to be made in a substantive andcomprehensive manner, and all violations, especially at big loss-making firms,must been strictly handled, an official has said.
The remark was made by Tran Tien Cuong, who leda Central Institute for Economic Management (CIEM) group in compiling a reporton accelerating SOEs restructuring in 2016-2020.
He added the Government also needs to overhaulmechanisms and regulations on the rights and obligations of relevant partiesduring the restructuring process, especially equitisation.
CIEM said in the report that SOEs restructuringis still sluggish and low quality.
From 2016 to May 2017, 65 SOEs and five publicservice institutions were equitised. Thirty-eight SOEs had their valuepublicised but their equitisation plans haven’t been approved. Meanwhile, thevalue of another 107 firms is being verified.
The report attributed the slow equitisation tothe unchanged policy on the sale of SOEs’ shares, adding that many regulationsare not practical, making equitisation unattractive to investors.
According to CIEM, while eight SOEs announcedbankruptcy from 2011 to 2015, only one went bankrupt from 2016 until now. Theinstitute considers this number minuscule compared to how many loss-making SOEsneed bankruptcy.
Both creditors and employees not wantingbankruptcy is the main reason for the firms staying afloat, said Pham Duc Trung– head of CIEM’s reform and development board.
Additionally, persons held responsible forloss-making projects and poor-performing firms have yet to be clarified. Othercauses include shortcomings in financial and budgetary discipline andincomplete corporate governance frameworks.
Cronyism and interest groups have also beenrecognised as factors hampering SOEs restructuring.
CIEM Director Nguyen Dinh Cung said it isnecessary to existing State assets more efficiently, including SOEs, instead ofextracting more crude oil and coal or exporting more minerals to boost growth.
A one percentage point improvement in assetmanagement would generate about 3-4 billion USD in return, and could push thegrowth rate of all SOEs up to 7 to 8 percent per annum, he noted.
Some experts said the list of State-investedassets should be immediately restructured to recover as much State capital fromequitisation as possible.
Deputy Minister of Planning and Investment DangHuy Dong urged the enhancement of SOEs management and supervision, thetransparency of SOE-related information and the inspection of SOEs’ activities.
Responsibility of leaders of ministries,sectors, localities and SOEs must also be increased. Business leaders who failto effectively carry out restructuring must be stringently punished, headded.-VNA
The remark was made by Tran Tien Cuong, who leda Central Institute for Economic Management (CIEM) group in compiling a reporton accelerating SOEs restructuring in 2016-2020.
He added the Government also needs to overhaulmechanisms and regulations on the rights and obligations of relevant partiesduring the restructuring process, especially equitisation.
CIEM said in the report that SOEs restructuringis still sluggish and low quality.
From 2016 to May 2017, 65 SOEs and five publicservice institutions were equitised. Thirty-eight SOEs had their valuepublicised but their equitisation plans haven’t been approved. Meanwhile, thevalue of another 107 firms is being verified.
The report attributed the slow equitisation tothe unchanged policy on the sale of SOEs’ shares, adding that many regulationsare not practical, making equitisation unattractive to investors.
According to CIEM, while eight SOEs announcedbankruptcy from 2011 to 2015, only one went bankrupt from 2016 until now. Theinstitute considers this number minuscule compared to how many loss-making SOEsneed bankruptcy.
Both creditors and employees not wantingbankruptcy is the main reason for the firms staying afloat, said Pham Duc Trung– head of CIEM’s reform and development board.
Additionally, persons held responsible forloss-making projects and poor-performing firms have yet to be clarified. Othercauses include shortcomings in financial and budgetary discipline andincomplete corporate governance frameworks.
Cronyism and interest groups have also beenrecognised as factors hampering SOEs restructuring.
CIEM Director Nguyen Dinh Cung said it isnecessary to existing State assets more efficiently, including SOEs, instead ofextracting more crude oil and coal or exporting more minerals to boost growth.
A one percentage point improvement in assetmanagement would generate about 3-4 billion USD in return, and could push thegrowth rate of all SOEs up to 7 to 8 percent per annum, he noted.
Some experts said the list of State-investedassets should be immediately restructured to recover as much State capital fromequitisation as possible.
Deputy Minister of Planning and Investment DangHuy Dong urged the enhancement of SOEs management and supervision, thetransparency of SOE-related information and the inspection of SOEs’ activities.
Responsibility of leaders of ministries,sectors, localities and SOEs must also be increased. Business leaders who failto effectively carry out restructuring must be stringently punished, headded.-VNA
VNA
