Vietnam needs privatization breakthrough in 2019: deputy PM

Hue said at Friday’s cabinet meeting that divestment doesn’t necessarily require a preservation of the state capital.

Even when the market price of the capital is lower than its book value, the state can still divest, as the longer it holds the capital, the less benefit it will receive, he said.

Hue also noted that weak state-owned enterprises (SOEs) that can be developed to privatize and divest should not be sold at an early stage as that could cause harm to the state.

All violations in the privatization and divestment process will be strictly punished. Leaders and authorities who delay and slow down the privatization and divestment process will be held accountable, he added.

The government plans to have only 150 wholly state-owned enterprises by 2020, from 526 in 2017, and 1,369 in 2011.

The speed of privatization and divestment has slowed recently years, the Deputy Prime Minister noted.

The country privatized only 32 SOEs last year, but its target was 85, a government report released at the meeting said.

The state divested its ownership in only 52 businesses last year, although its goal was 181. In 2017, the state divested only 17 out of 135 businesses.

The plans were not achieved because there were many large-scale businesses with complicated financial situations and a lot of property involved, the report said.

Some ministries, provinces, cities and businesses have not been determined in furthering the process, it added.

Last year, the state collected VND24.25 trillion ($1.04 billion) from initial public offerings and selling stakes to strategic partners. This was almost five times the figures in 2017.

The state also collected over VND16 trillion ($688 million) in divestment, 2.58 times that of the original value of its ownership in SOEs.