Vietnam targets 10 $5 bln state-owned firms by 2025

In accordance with a resolution to improve the effectiveness of state companies signed by Deputy Prime Minister Le Minh Khai, Vietnam will have at least 25 state-owned businesses with either a stockholder’s equity or a market capitalization of $1 billion. Among these, at least 10 businesses must reach over $5 billion in capitalization.

Within the next five years, these companies would contribute 5-10 percent more to the national budget compared to the 2016-2020 period. All state-owned businesses would shift their investments towards projects that utilize green technologies and reduce carbon emissions.

State-owned businesses now account for around 0.08 percent of all businesses in Vietnam, but possess around 7 percent of assets and 10 percent of equity of all businesses in the market, according to the Ministry of Finance. They also account for around 26 percent of stockholders’ equities and over 23 percent of the value of fixed assets and long-term financial investments of active companies.

In 2020, state-owned firms contributed around VND241.73 trillion ($10.4 billion) to the national budget.

The HoSE stock exchange now has 49 businesses whose capitalization reaches at least $1 billion, accounting for 80 percent of the market. Some of them are businesses with state capital, like Vietcombank, BIDV, Vietinbank, Sabeco and Viglacera.

State-owned businesses have been tasked with investing in certain important projects in prioritized fields such as energy, semiconductor industry, traffic infrastructure and production materials.

The government has asked the State Capital and Investment Corporation (SCIC) to increase its role as the government’s investor in order to attract financial resources for important projects.

Under the resolution, the government will also pull out capital from “secondary fields” in order to focus them on primary areas of focus.