Soe roles to be restructured

The 12th National Assembly Economic Committee has completed a report with 10 proposals for ensuring macro stability of Vietnam in the medium and long terms, under which the committee suggests restructuring the roles of State-owned enterprises (SOEs).

According to the committee, the restructuring aims to help SOEs complete basic tasks, fixing shortcomings of the market and providing goods and services, instead of expanding non-core and ineffective businesses.

The report proposed to stop establishing more state economic groups by administrative decisions as it is against the rule of the market economy. Large-scale SOEs should disclose their business information like on the stock market.

The local economy has been mired in a paradox as fast GDP (gross domestic product) growth over the past five years caused high inflation, soaring foreign investment capital, budget deficit, public debts and imbalance of payments. As a result, Vietnam lost two golden opportunities to reach booming growth or economic restructuring brought on by the World Trade Organization (WTO) and the global economic crisis.

Experts pointed out inflation jumped nearly 60% in the 2006-2010 period while accumulative GDP growth was only 35.1%. The figures showed that income and living standards of residents declined sharply while a number of rich people and speculators gained hefty profits from the fast economic growth.

Ha Van Hien, head of the 12th NA Economic Committee, warned in the report that, Vietnam has been faced with periodic and systematical macroeconomic issues and efforts by the whole political system are needed in middle and long terms to help the nation restore sustainable development.

The committee, in the document, also prioritized the proposal of ensuring sustainable macro economic stability in the future. It also said the nation should renovate a development model and reorganize the economy in a sustainable way to eliminate causes of macro instability in the short term.

The nation also has to change its industry development plan and encourage successful and effective sectors.

The report proposed that the relationship between the state and market should be defined and legalized. It wants to make the central bank more independent, while the banking system should be restructured to avoid risks.

The committee also suggested the Government determine public investment reduction, boost fiscal discipline to cut budget deficit and stabilize public debts.

The report, prepared by the committee and the Vietnam Academy for Social Sciences, was sent recently to NA members in the hope that it would pave the way for the law making body to supervise the executive system in the new term.

Tags: Vietnam companies, Vietnam enterprises, Vietnam SOEs