Inspectorate urges HCM City to speed up restructuring of SOEs

Rạng Đông Light Source and Vacuum Flask JSC. Photo courtesy of the firm

HCM CITY — HCM City needs to speed up equitisation to restructure state-owned enterprises and improve their efficiency, according to the Government Inspectorate.

The equitisation of state companies is progressing at a tardy pace, a recent report by the inspectorate says.

It also has shortcomings in terms of allocation of assets for equitisation, determination of enterprise value, determination of the ratio of state capital post-equitisation, and selection of strategic investors.

According to the Ministry of Finance’s corporate finance department, many SOEs in the city are large and have complicated financial and land ownership structures, and so equitisation, especially evaluating their assets, is not easy.

As of 2016 the city had 62 SOEs fully owned by the state, according to the Government Inspectorate.

Phan Thị Thắng, vice chairwoman of the city People’s Committee, has sought the HCM City Business Management Innovation Board’s advice to remove obstacles and speed up equitisation of SOEs.

Equitisation plans for 2016-20 had not been fruitful, she admitted.

She said the People’s Committee would continue to inspect the use of public properties and real estate to ensure they are used in accordance with guidelines.

“It is necessary to speed up equitisation, but there needs to be clearer accountability,” she said.

Recently several SOEs have been prosecuted for violations in the use of public assets. 

The Saigon Agricultural Incorporation has been prosecuted for violations related to the use of 3.75ha of public land to invest in the Phước Long B housing project (Thủ Đức City). 

Liksin Corporation was found to have committed similar violations at 51-53 An Dương Vương (District 5).

The People’s Committee has appropriated many land lots for such violations.

In March the Government decided to widen the scope of SOE restructuring over the next five years to improve their efficiency and competitiveness based on technology, innovation and management.

It is expected to enable more effective mobilisation, allocation and use of resources.

Experts said the restructuring of SOEs must focus on resolving issues faced by weak and loss-making enterprises while maintaining, consolidating and developing efficient ones through good branding. — VNS