Accountability key for SOEs: Prime Minister
Updated : Tuesday, January 08, 2019 3:21 PM (GMT+0700)

Prime Minister NguyenXuan Phuc asked accountability to be enhanced in the restructuring anddivestment of State-owned enterprises (SOEs) to improve the efficiency of theprocess.

Dung Quat Bio Ethanol Plant, one of the 12 loss-making projects under the management
of the Ministry of Industry and Trade, resumed operation in October, 2018 – Source: VNA

Under Directive 01/CT-TTg dated on January 5, Phuc askedministries, ministerial-level agencies, local authorities and SOEs to completethe approval or submission the restructuring plans for approval before January15, in which, the restructuring roadmap and accountability must be clarified.

The directive said that the operation of restructured SOEsimproved considerably and contributed to stabilising the macroeconomy, citingthat 147 were equitised in the period from 2016 to November 2018 and nearly 155trillion VND (6.74 billion USD) in State capital collected from divestments outof none-core businesses in the period.

However, the directive pointed out that the results ofequitisation and divestment of SOEs were still below targets and the operationefficiency of SOEs was modest compared to the resources in their hands.

According to the directive, equitisation and capitaldivestment faced difficulties in evaluating corporate value. Especially, thelack of accountability, loose discipline, group interest and outdated thinkingwere hindering the progress of innovation.

Phuc stressed that the accountability of individuals andorganisations for the stagnation of restructuring and capital divestment atSOEs and the listing of equitised SOEs on stock exchanges must be enhanced,adding that strong punishments would be raised to prevent and handleviolations.

Ministries and ministerial-level agencies must speed up andcomplete the legal framework for restructuring and improving the operationefficiency of SOEs in the first quarter of this year.

Focus must be placed on renovating corporate governance andimproving the operation efficiency and competitiveness of SOEs afterequitisation, Phuc asked.

SOEs must be a pioneer in renovation and applyingtechnologies and new business models such as sharing economy, e-commerce andelectronic payments to operate more efficiently and meet the requirements ofthe digital era and Industry 4.0.

The directive also asked ministries and ministerial-levelagencies to enhance supervision to prevent losses to the State capital duringthe restructuring of SOEs, at the same time, and be determined to handleloss-making projects following market mechanisms.

The accountability of individuals and organisations whichcaused losses to the State capital must be clarified and violations must behandled strictly, it said.

Source: VNS/VNA

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