Deputy Prime Minister Nguyen Sinh Hung has recently requested the Ministry of Planning and Investment to complete building a legal framework of operations of state-owned corporations in the fourth quarter this year, the state-run Nhan Dan newspaper said on September 15.
Issuing the legal corridor is part of government efforts to accelerate share sales in 100 per cent-state-owned enterprises, which will be changed into one-member limited liability companies from now to 2010, the paper said.
So far, Vietnam does not have a single legal framework regulating operations of state-owned corporations, Thoi Bao Kinh Te said. Recently, state-owned corporations have been warned of investing into non-core businesses, including risky fields of finance, securities and real estate.
In Jun this year, investment by state-owned corporations into non-core businesses became a hot story among state-run media and Premier Nguyen Tan Dung then urged restricting non-core business among state-owned corporations. Corporations and groups are not allowed to invest more than 30 per cent of their total capital, the VietnamNet published and managed by the Ministry of Information and Communication said.
The Ministry of Finance also said that of more than 70 state-owned corporations and groups, 28 have expanded their operations by establishing fund management companies, stock brokerages, commercial banks and insurance firms with a combined capital of VND23.344 trillion, accounting for 8.7 per cent of their equity and 20 per cent of their non-core business investment value.
Recently, Vietnamese lawmakers urged clearing shortcomings to push up share sales in SOEs in the coming years. Between now to 2010, Vietnam will sell shares in roughly 950 SOEs.
As of June 30 this year Vietnam had restructured 5,041 companies and had sold shares in 3,786 SOEs and raised a total VND78 trillion.
Of the 3,786 equitized SOEs with a combined capital of VND250 trillion, the State holds VND75 trillion, up 36 per cent. Vietnam still has 1,720 100 per cent-state-owned companies with a total capital of VND410 trillion (US$24.8 billion). (The People, Investment)
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