The firms’ initial public offering (IPO) earned 2.7 trillion VND (118.8 million USD), up 600 billion VND from the initial valuation, Minister Nguyen Van The said at the National Assembly’s discussion on the implementation of the law on management and use of State capital and estate in businesses and the equitisation of SOEs in 2011-16 on May 28.

According to statistics, in the period, 18 corporations were turned into joint stock companies, recording a 15 percent increase in revenue, a 194 percent surge in post-tax profit, and a 32-percent rise in workers’ incomes.

Almost all equitised enterprises have to date reported effective operations and joined the settlement of jobs for labourers and construction of key transport projects, the minister added.

Also at the discussion, Government Inspector General Le Minh Khai said during the period, the Government Inspectorate conducted 19 inspections at State groups and corporations, detecting numerous violations. They proposed recovering more than 1 trillion VND in violations for the State budget, dealing with many organisations and individuals and transferring to the investigation agency to handle 16 cases and prosecute 17 others.

He pointed out shortcomings of enterprises such as incorrect and insufficient financial reports, which have yet to reflect the reality of State assets and limitations of a small number of persons in the financial-accounting sector.

He proposed forming mechanisms encouraging leaders of enterprises to do business better.

Meanwhile, Minister of Finance Dinh Tien Dung presented some related contents. He stressed SOEs are an important tool to ensure the effective implementation of policies toward macro stability, inflation control, response to market fluctuation and creation of big revenue to the State budget, thus contributing to building and developing socio-economic infrastructure and accelerating economic restructuring. They also contribute to carrying out defence-security and social welfare tasks .

Minister Dung affirmed there is no gap in the law in terms of management and use of State capital and the equitisation of SOEs, adding that legal documents are available such as laws, resolutions of the National Assembly, Government decrees, the PM’s decisions and ministries’ circulars.

He agreed with the proposals of supervision delegations on the need to build a higher legal framework on the equitisation of SOEs.

Discussing obstacles in the management and use of State capital, Minister Dung pointed out that regulations on principles, administrative rules and settlement of violations are not strict, leading to violations in obeying legal regulations on the management and use of State capital and assets at enterprises and the equitisation of SOEs.

Besides, the operational effectiveness of SOEs in 2011-16 period needs to be assessed in relation to the global economic downturn, he added.

Voters urge building of complete legal framework for SOE equitisation

The discussion at the National Assembly on the equitisation of State-owned enterprises (SOEs) during 2011-2016 attracted great interest of voters nationwide, with many urging more efforts to improve legal framework for the work. 

Lawyer Pham Ngoc Luong, standing chairman of the business association of Lao Cai province, said incomplete laws and policies, especially inconsistency among ministries’ circulars guiding the implementation of laws, caused many difficulties in carrying out SOE equitisation, resulting in delay, losses and wastefulness, along with inadequate attention to labourers’ interest.  

Therefore, it is necessary to push ahead with building a complete legal framework, particularly regulations on the role of the Party and socio-political organisations in the equitisation process, to ensure transparency and the involvement of all stakeholders in the process, he said. 

Lecturer Do Thi Thuy, Vice Dean of the Economics-Technology Department at Hoa Lu University in  Ninh Binh province, shared the view, adding that the Ministry of Finance should quickly issue guidance on foreign investors’ contribution of capital and purchase of shares in Vietnamese enterprises. 

She also emphasized the need to complete the system of institutions for the market economy, thus ensuring equal and transparent competition among enterprises of different types of ownership. 

Dinh Gia Nghia, Deputy Director General of the Dong Giao food export joint stock company in Ninh Binh, was of the opinion that during equitisation of SOEs, at least 65 percent of the State-owned stake should be put on sale in order to allow investors to have a voice in running the enterprises. 

According to Bui Quang Tin, executive director of the BizLight business school in Ho Chi Minh City, persuading foreign investors to become strategic investors of equitised SOEs is one of the solutions to improve the equitisation process and the quality of corporate governance after equitisation. 

The implementation of policies and laws on the management and use of State capital and asset in enterprises and the equitisation of State-owned enterprises during 2011-2016 was the focus of discussion at the National Assembly on May 28 as part of the 14th legislature’s fifth session. 

The discussion was broadcast live on national television and radio.

VNA