It is necessary to restructure state-owned enterprises (SOEs) so as to change their role in the economy and apply stricter business practices, according to one economist.
Dr. Nguyen Dinh Cung, Deputy Director of Central Institute for Economic Management
The restructuring should aim at effective allocation of Government funds to SOEs, as well as oversight over the use of those funds, said Dr. Nguyen Dinh Cung, Deputy Director of Central Institute for Economic Management (CIEM), in an interview with DTiNews.
"After addressing SOEs, the restructuring could move on to address other sectors of the economy to ensure efficient investment," he added.
Cung said that there are three major tasks to carry out in order to make sure that Vietnam's economic goals are met.
The first, he said, is to create a stricter business environment for SOEs, so as to reduce Government's role in incentives and subsidies in the sector, and eliminate SOEs monopolies.
Second would be to set up a framework for business administration for SOEs that would meet international standards, he said.
The third vital task he suggested is to focus on the business spheres of SOEs, with reforms to their spheres of business, management systems and organisation.
"We would have to pay great attention to creating a new business environment to achieve this third task, which would encourage SOEs to change their business practices and heighten efficiency," he emphasised.
He added that priority should be given to reclassification of enterprises.
"There are a total of 1,300 State-owned enterprises. Out of these, around 600 should be privatised, leaving about 700 maintained entirely by the State by 2015. In order to foster the private sector, the Government needs stop subsidising more than 4,000 already privatised companies,” he recommended.
He added that the Government should issue stronger regulations that would increase oversight, encouraging wholly State-owned enterprises improve their business practices and heighten efficiency.