Vietnam privatizes 150 state companies, misses end year target
HANOI - Vietnam has privatized just 150 state-owned enterprises this year, well below the government's target
of 1,000 privatizations by the end of 2000, an official with Hanoi's state sector privatization program told Dow Jones
Newswires Friday.
He said that by the end of 1999, Vietnam had privatized 370 companies, leaving a massive 630 to be transformed from full
state ownership to private ownership this year.
The government was unable to meet its target largely because of hesitation among the management of state-owned companies,
he said.
Vietnam has said it will sell stakes in several thousand non-strategic state companies to their management and employees in a
move that aims to raise corporate accountability and ease the government's burden of supporting the companies.
But many state-owned firms are loath to give up the security and priority treatment that government ownership provides. They
are also often unwilling to open their books to public scrutiny - a requirement of Hanoi's "equitization" program.
The official noted also that "ineffective guidelines from ministries" have also complicated the reform process by making it difficult
for reforming companies to know exactly how to change their structure.
Nonetheless, he said that despite its slow take off, "the program has brought about very significant benefits," for Vietnam.
He said the restructuring of 520 enterprises under the current plan has "raised around two trillion dong ($1=VND14,498) from
shareholders" and made it possible for the restructured companies to "greatly improve their operations."
Also, by removing those companies from the government's books, "the program has helped us reinvest (the equivalent of that) 2
trillion dong in other state-owned enterprises, helping the state sector to improve its overall operations," he said.
Analysts have said Vietnam's state sector must reform quickly if it is to compete in an increasingly open market place. Both
local and foreign private firms are developing a strong foothold in the Vietnamese economy, and a slow but steady liberalization
of the government's investment regime will allow them to continue growing in coming years.
Dow Jones Newswires- December 8, 2000.
|