Vietnam Communist Party to drop firms
HANOI - Vietnam's ruling Communist Party and the military will relinquish control of dozens of companies, ranging from hotels to telecoms, as part of an ongoing government overhaul, officials said Wednesday.
The 160-member Central Committee last week decided to transfer the companies managed by the Party and the armed forces to the state, said Dao Duy Quat, deputy director of the party's Ideological and Cultural Commission.
He said the move is part of overall government restructuring that will push Vietnam toward a market economy.
However, the armed forces, including the military and police, will maintain control of some companies that are directly related to national defense and security, he said.
It's still unclear how many businesses will be transferred, but the process must be completed by the end of this year, Quat said.
The Defense Ministry, the country's most powerful sector, manages more than 100 businesses, ranging from hotels and garment factories to banking and construction companies. It owns the Viettel mobile phone company, one of the country's largest operators.
Last month, Prime Minister Nguyen Tan Dung approved a list of 71 major state-owned enterprises, including national carrier Vietnam Airlines, that will be partially privatized between now and the year 2010.
There are an estimated 2,000 state-owned enterprises, down from some 12,000 in the mid-1980s. Vietnam began economic reforms more than 20 years ago and officially entered the
World Trade Organization earlier this month.
The Associated Press - January 31, 2007.
Vietnam's rulers propose cuts in army business
HANOI - The ruling Vietnam Communist Party wants the People's Army and socio-political agencies to get out of business as it moves to liberalise the mostly state-run economy.
The proposal, and others aimed at slimming down party and government agencies, were made at last week's plenum of the Central Committee, according to official media, which has been reporting details of the conference in the past few days.
The army runs major firms such as telephone and Internet service provider Viettel and the Military Bank, both of which would be privatised soon as shares of state-run firms are moved to a company that will sell stakes to private investors.
Military-run firms have business interests in logging, coffee and rubber production, coal mining, construction, chartered flights, ship building and repair, container terminal handling, garments and footwear, stock broking, health services and trade.
"The conference unanimously endorsed the policy to transfer the companies that are currently engaged in regular economic activities and under the management of party agencies, the armed forces, the Fatherland Front and other socio-political agencies to state-run agencies from 2007," e-newspaper Dantri (www.dantri.com.vn) quoted the conference report as saying.
The Fatherland Front is an umbrella group that includes organisations such as labour, health and social services under the control of the party, the only legal political entity in Vietnam.
The army runs around 140 companies and holds shares in more than 20 other firms operating in almost every area of the economy, Major-General Ho Sy Hau, head of the Defence Ministry's Economic Department, said on Jan. 9.
He said military firms generated 33 trillion dong ($2 billion) in revenues last year, 3 percent of Vietnam's gross domestic product.
"In the economic integration process, the Defence Ministry's policy is to restructure trading firms and companies with products of dual targets such as garments and textiles, footwear, equipment and electricity," Hau said in an interview published on the department's Web site (www.ckt.gov.vn). Communist Party agencies and the police also run businesses.
The proposals follow the five-yearly Communist Party National Congress in April 2006, which called for faster market reforms, increasing transparency and stepping up the fight against corruption and bureaucratic waste.
The Central Committee decided to halve the number of central level party organisations to six and several of the government's 26 ministries would be cut through mergers, the Vietnam Investment Review reported.
The Central Committee would meet again to finalise policies and government cabinet changes before elections for the one-party National Assembly, or parliament, on May 20, the reports said.
Vietnam's economy grew at 8.17 percent in 2006 with a target of 8.5 percent growth in gross domestic product this year.
The Southeast Asian country became the newest member of the World Trade Organisation on Jan. 11, which obliges Hanoi to accelerate its 20-year long market-orientated reforms so businesses can compete under international trading rules.
Reuters - January 31, 2007.
Vietnam mulls plan to bar military, party from doing business
HANOI - Vietnam's ruling Communist Party, armed forces and police would have to shed their business interests under reforms now being considered, according to officials and reports.
An upcoming party meeting will also look at streamlining Vietnam's party and state apparatus by merging several of the 26 government ministries and 11 party committees, the central committee of the party has said.
The reform proposals, backed by a veteran party figure and state newspaper editorials, come at a time of rapid change in Vietnam, East Asia's second fastest growing economy which this month joined the World Trade Organisation.
The party's central committee last week proposed consolidating many party and state bodies to "get rid of bureaucracy, overlapping roles and responsibilities to make their structure more streamlined and effective."
The 160-member committee also agreed on "a policy to shift purely existing economic establishments under the party, armed forces, Fatherland Front and social-political organisations to the management of the state from 2007."
The reform proposals would be considered at the central committee's fifth plenum, expected to convene before Vietnam's May 20 national assembly elections, the central committee said in its report.
"The idea is encouraging," Le Dang Doanh, a senior economist with the Ministry of Planning and Investment said Tuesday.
"It's a sign of progress," he said, adding however that so far no details were available on the proposed changes.
Vietnam's military now owns many leading companies, including telecom firm Viettel, the Military Joint Stock Commercial Bank, the Thang Long and Truong Son construction corporations, and the Ba Son ship-building company.
The Communist Party, the party-controlled Fatherland Front and police forces at provincial and district levels are also involved in business activities, including hotels, manufacturing and import-export firms.
A Western diplomat said getting these institutions to shed their business interests would be "a welcome and overdue step on Vietnam's path toward becoming a normal integrated economy with a sound market economy.
"It would not be a complete surprise. Similar steps were taken several years ago by Vietnam's big northern neighbour China," said the diplomat, speaking on condition of anonymity.
However, the diplomat cautioned that, even if the regime goes ahead with the plan, "it would remain to be seen how this divesture is carried out in practice" and who would end up controlling the business interests.
Agence France Press - January 30, 2007.
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