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| Slow equitization and divestment affect State revenue estimates. Photo: Internet |
More than one year, one enterprise is equitized
The Ministry of Finance reported that from the beginning of 2022 to now, the country had recorded one equitized enterprise, An Giang Ferry Company Limited, on the list of equitization for the 2017-2020 period, approved by the Prime Minister with a total enterprise value is VND309 billion of which the actual value of state capital is VND278 billion. In the first three months of 2023, the units continue to carry out equitization according to the approved plan. Regarding divestment, in 2022, state capital divestment was recorded in one enterprise (State Capital Investment Corporation (SCIC) divested capital at Vietnam Infrastructure and Real Estate Joint Stock Company) with a value of VND195 billion, earning VND390 billion; corporations, groups and state-owned enterprises divested capital in 31 enterprises with a value of VND688.7 billion, earning VND3,900.6 billion.
According to the Ministry of Finance, in March 2023, the country recorded a case of SCIC’s divestment in Inland Waterway Maintenance Management Joint Stock Company No. 9 with a value of VND3.3 billion, earning about VND20.5 billion. In addition, in the first three months of 2023, groups, corporations and SOEs divested capital from four enterprises with a value of VND41.2 billion, earning VND168.4 billion, of which SCIC earned VND33.6 billion from divestment in three enterprises with the value of VND6.8 billion, Vietnam Chemical Group earned VND134.8 billion from divestment in Tia Sang Battery Joint Stock Company with a value of VND34.4 billion.
The slow progress of equitization and divestment is because that enterprise subject to equitization and divestment have a wide range of activities, multi-industry, multi-field, many specialized assets difficult to determine the price, the financial handling of assets and liabilities, the determination of enterprise value, the value of the state capital and the preparation of documents and plans take a lot of time; some enterprises still have many financial problems and some others violate regulations on management of capital and assets under inspection, examination and investigation.
The complicated development of the Covid-19 pandemic in the past two years, and the world’s political-military conflicts have affected the financial market situation in the country and the region, affecting the valuation of enterprises implementation of auction of state capital according to regulations.
According to Mr. Le Xuan Hai, Deputy Director of the Department of Corporate Finance (Ministry of Finance), from 2021 to 2025, especially the 2021-2022 period, the equitization process was under great pressure by the Covid-19 pandemic because of real estate rearrangement and enterprises valuation need to be carried out in the field.
In addition to objective reasons, subjective reasons leading to slow equitization are the awareness and implementation of some owner’s representative agencies and the head of enterprises; the lack of attention review and planning of restructuring enterprises for the 2021-2025 period; and the ineffective preparation for equitization and divestment.
Strictly handle cases of delay or violation of regulations on equitization and divestment
Le Xuan Hai said that ministries, central and local agencies have been directing equitization enterprises to rearrange, review, make inventory, classify, and determine value of assets and housing and land facilities. The Ministry of Finance regularly reports to the Government and the Prime Minister, and guides ministries and central and local agencies to accelerate the rearrangement of housing and land facilities and the determination of enterprise value. Facing the instability of the domestic and foreign financial markets in recent years, the Ministry of Finance has requested the restructuring of SOEs, focusing on equitization and divestment to achieve the desired purpose, and regularly reported to the Government or the Prime Minister. The Ministry of Finance, as a management agency, regularly urges and reminds ministries and central and local agencies to speed up these contents.
Regarding the slow equitization, Deputy Minister of Finance Nguyen Duc Chi said that the Ministry of Finance expects quick divestment and equitization because in the revenue estimate, revenue from equitization and divestment of SOEs account for a significant rate. Therefore, if the equitization and divestment fail to reach the plan, the Ministry of Finance will not complete the revenue target, affecting the overall budget revenue estimate. Therefore, the Ministry of Finance is looking forward to implementing equitization and divestment legally, publicly, transparently and effectively, ensuring the interests of the State, investors and enterprises. The Deputy Minister said that the Ministry of Finance is to try to improve the legal framework and actively solve problems, but because many other reasons are causing the slow equitization and divestment.
In order to speed up the equitization and divestment in the coming time, the Ministry of Finance said that it will continue to review, study, and amend relevant mechanisms, policies and laws to remove difficulties and obstacles. In which, the Ministry of Finance is to study amendments and supplements to legal documents under its authority on equitization and divestment to submit to the Government and the Prime Minister.
Furthermore, the owner’s representative agencies urge enterprises who directly manage and use house and land to declare and report, make land and housing rearrangement plan according to the provisions of Decree No. 167/ 2017/ND-CP and Decree No. 67/2021/ND-CP to submit to competent authorities for approval.
The People’s Committees of the provinces and centrally-run cities will soon give their opinions on the plan to rearrange and handle houses and land of central enterprises located in the area at the request of the Ministry of Finance, other ministries and central agencies to ensure the progress of approving the land and housing rearrangement plan to serve the formulation of the land use plan upon equitization.
 | Equitization and divestment of State capital not yet drastically performed |
The Ministry of Finance also requests to strictly handle cases of slowing down or violating regulations on equitization and divestment of state capital in enterprises; clearly define the responsibilities of the organizations and individuals involved, especially the leaders in the arrangement, equitization, divestment, restructuring of SOEs, performing related tasks; consider the performance of tasks and the results of the arrangement, equitization, divestment and restructuring of SOEs as an assessment criterion for related agencies, units, collectives and individuals.