State-owned enterprises a headache for Vietnam
HANOI - All ministries, agencies, localities and major corporations
must unveil their road maps of corporate equitization, as well as
their plans for the dissolvement of non-viable state-owned
enterprises under their management, said a senior official of the
Finance Ministry. In return, the government will issue more
policies and revise its legal documents to help promote corporate
equitization and restructuring throughout the country.
Vietnam's state-owned enterprises (SOEs) must be restructured in
order to gradually lessen their financial burdens and the
government's intervention into the corporate sector, while at the
same time raising their economic efficiency and competitive
capability in the course of regional and international integration.
Tran Van Soan, Director of the Finance Ministry's Financial
Management Department, said that many SOEs have not yet improved
their business efficiency and competitiveness in both domestic and
international markets, despite their efforts for technological and
managerial renovation.
Soan attributed this failure mainly to the excessive number of
SOEs, which, he said, are scattered in many economic branches and
sectors, as well as in every city and province across the country.
Currently, small-and medium-sized enterprises (SMEs) with their
working capital of less than VND5 billion (US$333,400) account for
69.8 percent, while those with capital of more than VND20 billion
make up only 13.7 percent of Vietnam's total SOEs. In addition, he
said, their technological equipment and machinery is outdated,
perhaps lagging 10-20 years behind those of other countries, while
their managerial level is also much lower than foreign countries.
Most SOEs have still lacked investment capital or working capital,
Soan stressed, saying that many have failed to pay their debts,
which are usually about 20-30 percent higher than budget
allocations given to them by the government. However, the
government has to hold SOEs in key economic sectors, which still
serve as an important instrument for the government to ensure macro-
economic management. Other SOEs will be subject to equitization or
the change of ownership through sales or lease contracts.
A number of SOEs will be shifted to new types of business
operations such as limited liability companies and major business
corporations or conglomerates with mother companies and
subsidiaries, the official added. In the new business types, the
relationship between the government and enterprises is one between
the owner and the user of investment capital through their economic
contracts and agreements, and the former will be represented by an
intermediary financial agency in a bid to separate the Government's
managerial task from its status of capital ownership, Soan
elaborated.
Asked about SOEs' debt burdens estimated at VND15 trillion-20
trillion, he said that all SOEs must be responsible for their own
debts and as such they have to seek every way and mean to pay these
debts, including asset liquidation, sales of in-store goods and
products, and collection of their loans and lendings. Any
individual or organization that is held responsible for bad debts
has to pay them according to law, the official emphasized, saying
that the government will certainly take tough measures to deal with
non-viable SOEs in accordance with the resolution passed by the
Party Central Committee at its recent plenum.
Asia Times - September 27, 2001
Viet plan to combat unemployment
HANOI - Vietnam has announced a plan to combat rising unemployment
through labour exports and low interest loans worth US$400mil to
spur entrepreneurship among the poor.
The scheme is intended to create 7.5 million new jobs by the year
2005, according to the of-ficial Vietnam News.
Urban unemployment has risen to more than 7%, up from 6% in 1998,
according to World Bank figures.
The new labour plan calls for a three-pronged attack: traditional
job creation in agriculture, industry and services, labour ex-port
and the entrepreneur loans.
The Ministry of Labour, Invalids and Social Affairs plans to secure
overseas employment contracts for 300,000 workers by 2005, the
Vietnam News reported.
The potential impact on the economy is about US$300mil, since
statistics show Vietnamese overseas workers have in the past sent
up to US$1,000 each a year back home.
The government also is relying on a new soft-loan scheme for more
than 1.5 million unemployed and low-income Vietnamese to fund their
own small businesses. An average loan will be 4 million Vietnamese
dong (about RM1,280).
Finding jobs for the more than 1.2 million Vietnamese who enter the
job force each year is one of the biggest challenges facing the
government. The country experienced a post-war baby boom that is
now coming of age at the same time that a shortage of land makes
traditional farming a less-attractive option.
Vietnam earlier this year announced plans to create new jobs in its
fledgling information technology sector by training 50,000 new
software experts over the next five years.
The Star (Malaysia) - September 26, 2001
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