SEMINAR

 

Topic:          Equitization of SOEs in Vietnam and the Role of State Capital and Investment Corporation (SCIC)      Speaker:      Dr Le Dang Doanh                         Former President                         Central Institute of Economic Management                         Socialist Republic of Vietnam                                                    Date:            Wednesday, 27 February 2008      Time:           4.00 pm – 5.30 pm      Venue:        ISEAS Seminar Room II

 

About the Speaker

After retiring from government duties in July 2007, Le Dang Doanh joined the first private, independent Institute of Development Studies in Hanoi in November 2007.  In his government career, he served as Advisor to the Minister of Planning and Investment from 2001 to 2007, as President of CIEM from 1993-2001, and as Member of the Prime Minister’s Research Commission from 1993-2006. He was Senior Expert in the Office of General Secretary of the Communist Party of Vietnam from 1998-1990. Le Dang Doanh graduated from the Technical University Leuna-Merseburg in 1967 and holds a PhD from the University of National Economics in Hanoi.

 

Abstract

Vietnam insists that the “state sector plays the leading role in the national economy” but needs to reform its state-owned enterprises. From 1992 until the end of 2007, 3,800 small and medium- sized SOEs holding 25 percent of the total assets of all SOEs have been equitized and turned into joint-stock companies. The equitization process in 2007 slowed down significantly, when only 116 SOEs were equitized, out of a planned 500. On the other hand, several equitized SOEs have been listed on the stock market and are able to successfully mobilized capital for their development. The Government has decided to equitize some more important SOEs in the time to come.

 

The establishment of the State Capital and Investment Corporation (SCIC) in 2005 in fact was an important step moving from an administrative to a market-oriented way of management of state-ownership in the equitized SOEs.  The equitized SOEs have to compete in an integrated economy and the SCIC could assist them in this process. The SCIC has so far facilitated the restructuring of a number of SOEs, including M&A with foreign participation.  For example, state-owned shares in Pacific Airlines were sold to Australia Qantas, and state-owned shares in BaoMinh-CMG were sold to Japanese Dai-ichi Life Insurance Company etc. The further equitization of SOEs and the activities of SCIC could open opportunities for foreign investment in Vietnam.  To facilitate its work, the SCIC has also referred to the model of Temasek Holdings of Singapore, and has in fact signed a MOU with it for cooperation.

 

UNAS members were cordially invited to the Seminar.