More Open to Economic Operation

According to the economists, the macro-economic stability solutions have basically achieved the targets. Specifically, the CPI increased by one percent in September, mainly due to the price fluctuation in the service sector, but the CPI in September was lower than that of the same period last year. In the monetary field, the exchange rate has been kept stable. The credit is now growing. The GDP growth is forecast to reach 5.4 percent or 5.5 percent. Particularly in the field of foreign economic relations, there are also many important achievements. Vietnam has negotiated many agreements to open markets, such as the establishment of a free trade zone with the EU, Korea, Customs Union and most recently, the TPP negotiations. These aim to create new export markets for domestic goods.

 

Under the pressure of budget revenues and expenditures as well as the difficulties of the macro-economy, the question of the senior bureaucracy in the Government of Vietnam is being considered seriously. Specifically, in a recent cabinet meeting, many delegates said that there are too many deputy ministers in some ministries now. The number of deputy ministers of some ministries is now over four. Clause 3, Article 3 of Decree 36 of 2012, states that the number of deputy ministers in a ministry does not exceed four. Considering the problems mentioned previously, the Government has asked the ministries to make reports on their progress and propose the number of deputy ministers needed to ensure their functions. The government has also assigned the Vietnam Ministry of Home Affairs to research and propose feasible solutions of how many deputy ministers are needed in each ministry. The recommendations of the Vietnam Ministry of Home Affairs have been sent to the ministries. Currently, each ministry is discussing this issue.

 

However, based on the primary guidelines, the Government of Vietnam will consider and review the number of the deputy ministers in the ministries. Some ministries such as the Ministry of Planning and Investment and Ministry of Finance are required to be present in most of the Government’s meetings, so the Government should consider how many deputy ministers are required in these ministries, Minister Dam said.

 

To implement the strategies to restructure state-owned groups and corporations, the government should set the ratio of state-owned shares to guarantee dominance. In the recent business trip to the United States, Vietnamese Prime Minister also had discussions with the U.S. investors about the equitisation and privatisation plans of the state-owned corporations and groups. However, this is a long story because it strongly relates to the economic drivers of Vietnam. Over the past 10 years, Vietnam has arranged, equitised, sold and leased from 1,300 to 12,000 state-owned enterprises. But according to the experts, the issue of equitisation is not merely about holding what percentage of ownership, but more importantly, the change in the structure of the corporate governance. Also, when raising issues relating the private sector, it is necessary to ensure transparency, publicity and compliance with international rules. Also, in each specific area, the government will also set a ceiling number of shares that non-state enterprises or foreign shareholders can buy. This issue is evident in the banking sector; currently, the largest banks such as Vietinbank, Vietcombank, and BIDV have made the equitisation.

 

Up to now, the ceiling percentage of shares that foreign shareholders could own is 30. However, according to market trends, the government will consider raising the ceiling percentage of shares in the next public offerings. In the future, state capital is not necessarily retained at 70 percent or 51 percent. Compared to other developed countries, the government can only hold one percent and it's considered the "golden share", from which the government still has the rights to decide the core issues of the business. Therefore, the new decision of the government to allow the "room" for equitisation completely follows the right guidelines of the current legal documents.