Carving up state ownership and management functions will be a golden key
to unlock state-owned enterprises' potential.
Currently, state administrative
organs own and manage about 1,300 state-owned enterprises (SOEs) in Vietnam – a
practice which often leads to ineffective management decisions which are out of
touch with market developments.
"To implement these two
functions is like a person to be the judge in his own case which will badly
affect business climate and create discrimination," said Le Xuan Ba,
director of the Central Institute of Economic Management (CIEM). Ba said the
practice was responsible for many SOEs' poor corporate governance, highlighted
by the Vinashin and Vinalines scandals.
"SOE owners don't have
enough capacity to undertake the role of an investor. Therefore, it is
necessary to transfer the ownership function from state administration to more
neutral others," he added.
Former CIEM director Le Dang
Doanh agreed with the necessity to separate these functions, adding that apart
from administrative management, state management agencies were too busy with
SOEs' operation, while enterprises were not allowed to implement their
ownership rights.
However, experts said untangling
these two separate functions was not easy. "Vietnam's process to
restructure SOEs started from 1965, but until now it has not been
successful," said Doanh.
Habeco and Sabeco, two giant
state brewers, underscore the challenges in untangling these two functions.
Despite being equitised for many years, the Ministry of Industry and Trade
(MoIT) retained its ownership rights in these enterprises with the rationale
that the firms play such a dominate role in the market.
The MoIT proposed the prime
minister allow it to transfer state capital to some small enterprises and then
larger ones later, while under the current regulations, state capital would
need to be transferred to State Capital Investment Corporation (SCIC) following
equitisation.
Doanh said group interest was the
reason why these two functions had not been separated. Dr Dinh Quang Ty, member
of Central Theoretical Council, said it was necessary to change the perception
of SOEs' roles in national economy.
"We cannot force SOEs to
have the same rate of return as private enterprises. Therefore, SOEs should
only focus on sectors and areas necessary for the common development of the
national economy where private enterprises do not have enough capacity,"
said Ty.
To address group interests,
Vietcombank board member Le Thi Hoa said the state needed to release legal
documents to create a adequate and clear legal mechanisms for state capital
ownership and management to be a premise for checking and inspecting SOEs.
Nguyen Trang | vir.com.vn
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