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Friday,  Nov 24,2017,03:37 (GMT+7)

Certain SOEs reluctant to go public

Tu Hoang
Thursday,  Jul 13,2017,20:51 (GMT+7)
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Certain SOEs reluctant to go public

Tu Hoang

Deputy Prime Minister Vuong Dinh Hue, head of the Steering Committee for Enterprise Reform and Development, speaks at a meeting on Tuesday - PHOTO: VGP

HANOI – Some State-owned enterprises (SOEs) do not want to undergo equitization, said Deputy Prime Minister Vuong Dinh Hue at a meeting on Tuesday.

Deputy PM Hue, who is also head of the Steering Committee for Enterprise Reform and Development, said a number of cities and provinces had even asked the central Government for advice or approval to proceed with SOE equitization plans.

They fear they would be held responsible if there are problems with SOE equitization plans, he said, adding ministries and local governments should carry out SOE equitization plans in line with the prevailing rules and in a transparent manner.

He urged the completion of SOE equitization and capital divestment plans this year.

The Prime Minister's Decision 58/2016/QD-TTg chose 137 SOEs to go public in the 2017-2020 period, with 45 of them to be equitized this year, said Le Manh Ha, vice chairman of the Government Office and deputy head of the steering committee.

Six SOEs went public in the first half of this year and 14 others got their assets evaluations done but their equitization plans were not yet completed. They include three affiliates of the Vietnam Oil and Gas Group (PVN) with total equity of VND90 trillion, and one member of the Vietnam Electricity Group (EVN) with equity of around VND24 trillion.

Competent agencies are assessing the value of 20 SOEs, so 40 SOEs may be equitized this year.

As of June 30, VND666.8 billion worth of State capital in book value at 22 companies where the State does not need to retain ownership had been sold, with total revenue reaching VND11.5 trillion. Six of them had been sold at prices below predetermined levels.

State stakes at 12 large SOEs will be sold at the request of the Prime Minister, with 11 of them having listed on the stock market.

Saigon Beer, Alcohol and Beverage Corporation (Sabeco) is looking for a consultant to divest State capital. Meanwhile, Hanoi Alcohol Beer and Beverage Company (Habeco) is having some difficulty as Denmark’s Carlsberg Breweries A/S holds a controlling stake at the firm.

The State Capital Investment Corporation (SCIC) has sent the Prime Minister two plans for withdrawing State capital from Vinamilk, the country's leading dairy processing firm.

In Decision 707/2017/QD-TTg issued on July 10, the PM approved a restructuring scheme for SOEs in the 2016-2020 period. The decision requires State-owned business groups to prepare and submit their equitization plans in this period.

The equitization plan of EVN has been approved by the PM while that of PVN is being checked by the Government Office before it goes before the PM. Five other groups that have yet to produce any plans are Vietnam Rubber Corporation, Vietnam National Coal and Minerals Industries Group (Vinacomin), Vietnam Post and Telecommunications Group (VNPT), Vietnam Military Telecommunications Group (Viettel), and Vietnam National Chemical Corporation (Vinachem).

The transfer of the remaining State stakes at the already-equitized enterprises to SCIC has been slow, and the listings of these enterprises on the stock market have not been taken seriously. Especially, none of 39 SOEs in HCMC chosen for equitization from now to 2020 has gone public.

Deputy PM Hue said the restructuring, equitization and capital divestment of SOEs have yet to meet the targets, so things cannot be done in the remaining six months of this year as 578 enterprises have not listed on the stock market as requested.

He added SOEs are still marred by low business efficiency and the lack of international business practices.

Regulations on assessment of landed assets, and responsibilities of State property administrators are not clear, thereby hampering equitization. However, Hue said the main reason is that some ministries, local authorities and enterprises have little appetite for SOE equitization and divestment.

He said the Government would hold them accountable as per Directive 04 of the Prime Minister and a SOE restructuring and innovation resolution adopted at the 5th Plenum of the 12th Party Congress.

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