Equitization: Heads must take responsibilities under Prime Minister for failure to fulfill assigned plans

	Renewing the management of revenues from reorganization and equitization of state enterprises
	Mobilising revenues from equitisation and divestment to State budget
	Overlapping regulations the key issue facing SOE performances

Illustrative photo. Source: internet.

Many enterprises subject to equitization in 2020

According to the latest statistics, in the first four months of 2020, the Ministry of Finance received the equitization reports of three public service delivery units in Hau Giang province (which approved equitization plans in 2019).

Thus, from 2016 to April 2020, only 174 enterprises were approved by the competent authorities for the equitization plan, with a total enterprise value of VND443,126 billion, of which the value of state capital was VND206,748 billion.

Among 174 equitized enterprises, only 36 out of 128 equitized enterprises were on the list of equitization according to Official Letter No. 991 / TTg-DMDN and Decision No. 26/2019 / QD-TTg of the Prime Minister (reaching 28% of the plan), the number of enterprises subject to equitization according to the plan by the end of 2020 is 92.

Thus, units with many enterprises in the list of equitization in 2020 include: Hanoi (13 enterprises, including fourcorporations), accounting for 14% of the plan; HCM City (38 enterprises, including 11 corporations), accounting for 40% of the plan; State Capital Management Committee at enterprises (SCIC) (six enterprises, including three groups and threecorporations); Ministry of Industry and Trade (four enterprises, including three corporations) and Ministry of Construction (two corporations).

In general, the equitization progress in the first months of 2020 was slow, and due to the unpredictable developments of the COVID-19 pandemic, business and production and other activities of society have stagnated; equitization and divestment of enterprises have faced difficulties.

Besides, there are some other difficulties such as time to implement some contents of approving the land use plan and determining the value of state capital to divest.

On the other hand, the COVID-19 pandemic has a great impact on the financial and stock markets, reducing the interest of investors and the markets’ attraction.

Strict listing urged

The urgent task in the immediate period is to maintain the operation of the economy, minimize the impact of the COVID-19 pandemic and further promote corporate financial management, reform and improve the operational efficiency of state-owned enterprises, in which economic groups and state corporations need to focus on overcoming shortcomings, limitations and seriously, urgently and drastically implementing Resolutions of the Party, National Assembly, Government and guidance of the Prime Minister.

The Ministry of Finance has proposed to all levels to complete the approval or submit to the competent authorities for approval to deploy the project of restructuring enterprises under management in accordance with the provisions of Decision No. 707 / QD-TTg of the Prime Minister. Heads of ministries, agencies, localities and State capital management committee at enterprises are responsible for urging state-owned groups, corporations and enterprises to carry out approved equitization, divestment and restructuring plans.

In addition, State-owned enterprisessubject to equitization must urgently review the entire land fund in management and use to develop a land use plan in compliance with the land law and submit it to the People's Committees of provinces or cities under the Central Government for comments on the plan and land price for competent authorities to approve before determination of equitized enterprise value.

Representative agencies of state capital owners at enterprises subject to equitization by the end of 2020 must complete the determination of enterprise value, financial settlement and enterprise value announcement in 2020.

Along with that, representative agencies shall direct the representative of the state capital to urge the equitized enterprises to strictly implement the registration of transactions and listing on the securities market according to the law; and hand over enterprises subject to transfer of representative authority of state capital owners to SCIC.

The Ministry of Finance has also proposed heads of ministries, ministerial-level agencies, government-attached agencies and chairmen of People's Committees of provinces and centrally run cities to direct drastically the equitization, divestment and restructuring of state-owned enterprises under the set plan, attach responsibilities of heads with the results of the restructuring of state-owned enterprises, and take responsibilities under the Prime Minister for failure to fulfill tasks according to the plan assigned by the Prime Minister.

Foreign capital to flow into non-life insurers on hopes of State divestment State divestment is expected to lure foreign investors into and lift Vietnam non life insurance market

Especially, it is necessary to pay attention to employees, arrange employees appropriately, ensure jobs, stable incomes, and employees’ lives. In force majeure circumstances that require temporaryreduction of employees, there must be appropriate support regimes, policies and allowances.