SCIC will manage state capital at conglomerates

The State Capital Investment Corporation (SCIC) will gradually take over capital management in State-owned groups and conglomerates commonly known as Corporations 90 and 91, established under decisions No. 90 and 91 of the Government.

Vu Van Ninh, Minister of Finance cum Board Chairman of SCIC, told a meeting in Hanoi on Monday to review five-year operations of SCIC that “one of the major tasks of SCIC in the coming years is to gradually control State stakes in Corporations 90 and 91 and State groups.”

Currently, these conglomerates are put under the direct supervision of the Prime Minister, with all top executives appointed by the Government.

SCIC will seek to build up and implement modern corporate governance so as to enhance the business efficiency at State-owned and State-turned-shareholding concerns, he said.

Meanwhile, SCIC, recognized as a financing arm of the Government, will also boost divesture at those State-owned enterprises where State control is deemed no longer necessary so as to concentrate State funds in more important businesses.

Upon its birth five years ago, “SCIC was considered a special economic organization of the Government,… but it is envisaged to become a strategic investment group by 2020 to do business in important sectors on behalf of the Government,” Ninh said.

In the 2006-2011 period, SCIC took over State-owned capital ownership in nearly 1,000 companies. It has divested capital in nearly 520 enterprises, including sales of the entire State-owned stake in 466 local firms, for over VND2.7 trillion, or 2.1 times higher than their book value.

SCIC over the past five years has invested over VND6 trillion in the local economy through acquisition of shares, corporate bonds, contribution to establish new enterprises or raising ownership in those concerns with strong advantages in production and business.

SCIC also invests in energy, infrastructure and high-tech projects. The enterprise has cooperated with Electricity of Vietnam (EVN) to develop Vinh Son-Song Hinh, Thac Ba, Haiphong and Quang Ninh power projects.

It will cooperate with local and foreign investors to carry out key projects such as Lai Chau hydropower plant and Long Thanh International Airport.

SCIC general director Lai Van Dao said SCIC is making a draft decree in capital investment and management to submit to the Government, under which it will complete policies, raise chartered capital, build professional process and expand cooperation with partners inside and outside of Vietnam.

Last year, SCIC obtained over VND2.2 trillion in after-tax profit, 20 times higher than in 2006. The enterprise currently oversees total State-owned capital of VND15 trillion in book value.

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