Government Still Dominates Large SOEs after Equitisation

Government Still Dominates Large SOEs after Equitisation

The State will still hold over 50 per cent of the shares of State-owned enterprises (SOEs) after equitisation, which include those whose State funded capital is VND20 billion or over and contribution to the State budget is over VND2 billion for three consecutive years, stated Decision 155/2004/QD-TTg issued on August 24 by the Prime Minister in an attempt to classify State-owned enterprises (SOEs) and self-financing affiliates of State-run corporations.

It also regulates 21 important fields in which the State must hold 100 per cent of capital, such as production and supply of explosive materials, toxic chemicals, the national electric grid, national and international information system, flight control, money and valuable certificate printing, publishing houses, the lottery, urban lighting and water drainage.

SOEs that operate in remote and mountainous areas are also included in the list of 100 per cent-State-capital holding enterprises.

Furthermore, companies that hold over VND30 billion worth of State funds and contribute to the State budget VND3 billion upwards over three consecutive years, as well as those who are leading in the application of high technology to help stabilise sectors, such as crude processing, food wholesales, petrol, air and railway transport, also must remain 100 per cent State-owned.

The decision also clarifies sanction measures on SOEs that perform poorly or cannot meet equitisation requirements.

• DKP